Equity financing can impact business valuation significantly, providing both opportunities and challenges. On the positive side, it can strengthen a company's balance sheet, reduce financial risk, and provide capital for growth, which can lead to a higher valuation, especially in high-growth sectors. Equity financing can impact business valuation significantly, providing both opportunities and challenges. On the positive side, it can strengthen a company's balance sheet, reduce financial risk, and provide capital for growth, which can lead to a higher valuation, especially in high-growth sectors.