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How can using more debt impact a firm's capital structure?

The capital structure is comprised of debt and equity so inherently, any change to either will change the firm's capital structure. What is being proposed is that in advance of our IPO we will take on more debt. There are no universal truths as to what Wall Street might want to see in a capital structure, and for each firm the decision will be different, but it is important to understand what the changes to the company's capital structure mean. For the company, increasing debt increases the firm's leverage. The firm is therefore riskier, because more of the company's cash flows are dedicated to debt repayment or interest obligations. As such, there is less money left over for the firm's shareholders. However, once the fixed debt obligations are paid off, everything that is left over does go to...
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