Common people generally tend to have confusion regarding the operations and functions of a public firm with a partnership. The extent of liability of the shareholders, in the case of a public company, is limited by the value of shares purchased by them. However, for the members of a partnership firm, the liabilities are unlimited. The partners are jointly and individually liable to pay all the debts of the firm, regardless of the amount of capital invested by that person. In terms of capital, there is no minimum capital requirement for starting a partnership, whereas a minimum capital of 5 lakhs is mandatory for establishing a public company.