From Longman Dictionary of Contemporary Englishundercapitalizedun‧der‧cap‧i‧tal‧ized (also undercapitalised British English) /ˌʌndəˈkæpətl-aɪzd $ -dər-/ adjective BFif a business is undercapitalized, it has not been given enough money to operate effectivelyFrom Longman Business Dictionaryundercapitalizedun‧der‧cap‧i‧tal‧ized /ˌʌndəˈkæpətl-aɪzd-ər-/ (also undercapitalised British English) adjective FINANCE if a company is undercapitalized, it has less capital than it needs in order to operate effectively and growIf you set up a store and you’re undercapitalized, you’re going to go bust (=bankrupt). —undercapitalization (also undercapitalisation British English) noun [uncountable]The business is suffering from undercapitalization.