Enterprise value = equity + debt - cash
why would the value of your business include debt? how is EV different from stakeholders equity and why is it different? why is cash not included? why use this metric instead of market cap or the equity you have?
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Imagine if you tried to value a house based solely on the owner's equity position - that is what it would be like to value a company based solely on market cap. Take a house farm where all the homes are essentially identical. Were you you to value homes based on the size of the equity stake, you'd have different values for each home (based on who has the smaller mortgage) despite all the homes being essentially the same. While it is true that you could effectively control a company (or home) by owning all the equity, the bank(s) would still control some of the company (or home) since their debt has a claim on the asset.
Regarding the question about cash: if there was a big box of money in the house you were buying, you'd have to pay for that box of money, but then you'd get the box of money in return. You subtract cash from the EV since the money spent on purchasing the box of cash is returned to you (in the form of a box of cash).
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