Capital Raising – Process
Sourcing investment from Venture Capital, Private Equity or Family Office firms requires a structured approach with diligent preparation, planning and attention to detail all key to a positive outcome. In summary form we have broken down the process and at a high level, outlined our teams’ added value.
Key members of the WHC team have strong entrepreneurial backgrounds: having previously created and driven a numbers of national and international business ventures. We leverage this practical industry experience within our raise programme, assisting clients develop an approach and plan that works for their business and resonates with the investment community.
Our team will initially take a high level look at your core business fundamentals, progress to date and forward projections to help understand what capital you ideally require in the context of agreeing a realistic and appropriate raise that will attract positive interest in the market.
In parallel, we agree a valuation that works for you plus critically, will stand up to market scrutiny. To ensure investor credibility, we help align an evidence-based valuation rationale with structured exit projections focused on revenue or EBITDA multiples.
Critical to a successful raise is a set of presentation materials that optimally present your proposition, concisely focused on the areas that matter to investors
Understanding the detail, granularity and focus required, we guide and help prepare a set of presentation materials designed to resonate with the target audience. This will include a concise Business Plan (Information Memorandum), detailed financial model, investor slide deck (for the investor face to face presentations) plus a two page or short deck ‘Teaser’.
For the Business Plan, financial model and due diligence process we have comprehensive guides that outline the core content and structure expected for each.
When independently embarking on a capital raise without strong advisory representation, many CEOs will tell you that the most frustrating part of the process is is the inordinate time required to attract and engage the right potential investors.
Within the UK alone there are over 2000 private equity, venture capital and family office firms managing funds specifically allocated for direct equity placement. In turn, each of these organisations have their own, often narrow investment criteria. Key in achieving a strong investor shortlist is our knowledge of these focus areas, ensuring we only engage organisations we know to have relevant and aligned interests.
In addition to matching criteria, a stepped approach to qualification helps ensure only investors with genuine interest are brought forward. A high-level Teaser determines early appetite, a positive response to the business plan and associated financials demonstrates clear aligned interests, maximising the likelihood of a productive first engagement with your management team. Post meeting we guide and help structure next steps.
Our primary goal is to help ensure that tight investor qualification followed by positive management team discussions result in multiple parties making an offer. This being the case and as initial pricing and terms will likely vary between each investor, we help draw out the best offer with a view to receiving multiple Term Sheets and optimum terms for your organisation. In many cases we maybe familiar with key nuances of these investors, further reinforcing our ability to advise and guide to a final decision.
In parallel with this process and if you haven’t already done so, we strongly advise appointing a suitably qualified law firm to act for you through to completion. We are happy to recommend firms we trust and have worked with in the past if this would be useful.
Assuming terms are agreed with acceptable structure, conditions and pricing with the preferred investor(s); Term Sheet(s) will be signed locking the parties into a limited period exclusivity. This is designed to cover the anticipated duration of the due diligence phase, typically 45-90 days.
Depending on ready availability of the extensive detail required by the investors due diligence team, this can be a taxing process; a time where our extensive experience, counsel and knowledge gained through many previous successful transactions will likely be invaluable.