How to Raise Capital

We have just released our new 51 page e-book to help CEOs to understand exactly how to raise capital in today’s world.

The book chapter headings pretty much tell the story about what’s included:

  • The Process of Raising Capital
  • Create the Financial Plan
  • Create the Operating Plan
  • Determine the Amount of Capital Needed
  • Determine the Terms of the Capital
  • Determine Type of Offering
  • Write the PPM
  • Subscription Documents
  • Escrow Agent
  • Your Investing Audience
  • Create your Investor Presentation
  • Create your Marketing Plan
  • Execute & Close the Offering

This book is a gift from us — you can get it here.  We are also making available a complementary One-Hour Consulting session for CEOs who want to raise capital.

Why would I do this?

We offer consulting services to businesses like yours and I know that some percentage of the executives we help with our Special Report and One-Hour Consulting session will end up as our clients.

We want to be clear —

Joined Lanier Securities LLC as President/CEO

Jeff Villwock announced that he has joined Lanier Securities LLC as its President & CEO.  Lanier will privately place debt and equity securities through the direct solicitation of investors and provide investment banking services including M&A and corporate advisory services.   We intend to provide alternative investment products to individual investors through direct investment into companies and by marketing funds which will provide investors diversity and high yield current rates of return.

Lanier Securities is in the process filing a New Membership Application for FINRA’s approval to operate as a licensed broker/dealer.

This is a new era of capital formation in the US.  The JOBS act gives smaller companies a new opportunity to be properly capitalized.  We will use our experience to find good companies that deserve to be well capitalized, and then work with these companies through their life cycle.  It is our goal to become a firm known for raising capital for deserving private companies and assisting those companies to create value for shareholders.

This is an exciting time for capital formation in the USA and I believe we have an opportunity to make a meaningful difference for companies seeking capital and for the investors that wish to invest.

Growth Equity – Is Crowdfunding the Answer?

Crowdfunding is gaining a lot of press.  The SEC has finally come out with proposed rules and regulations to allow companies to raise growth equity through crowdfunding.  But is that the answer for most entrepreneurs in search of capital?

It’s very important to distinguish between “investment crowdfunding” and “direct investor solicitation”.   Most people think of Kickstarter or similar web sites when thinking of “crowdfunding”.  On these sites, an entrepreneur may raise some capital as donations, giving investors back product or other promotions, but not equity in the company.  Generally the amounts raised are small.

“Investment crowdfunding” rules were just issued by the SEC in October and won’t be effective until May 2016.  In investment crowdfunding, companies will be able to raise up to $1 million per year, and unaccredited as well as accredited investors can participate.

While that’s a move forward and will surely seed a lot of companies, most existing companies that have proven concepts need more than $1 million in $5,000 or $10,000 increments.

The JOBS Act also opened the door for “direct investor solicitation”.   Before the law changed, companies could not “solicit” for investment.  As an example, a company could not run an ad in the Wall Street Journal saying they wanted to raise $5,000,000 in equity.  

Fed to Investors: Economy So Bad, We Can’t Raise Rates 0.25%

When the Fed announced that rates will continue to be Zero, the stock market soared — for about an hour and then plunged.  Today down another 200+points.

Why?  Real simple — The Fed actually said that the world’s economy is so fragile that a meaningless rate increase of 0.25% was potentially a real problem.  And I’ll give them credit for being right about this — had the Fed raised rates, the Dow probably would have been down 500 points instantaneously.

Someone sent me this picture a couple of days back — and if a picture is worth 1,000 words, this one is probably what weighted on the Fed.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

This is downright depressing.  In the last 7 years, food stamp use has soared, as has the federal debt, the amount of money printed, student loans (which are future losses) and health insurance costs.  Obamacare reduces costs??  Really – don’t think so.

Déjà Vu All Over Again? Business Owner: 3 Actions to Take.

Yogi Berra was credited with saying, “It’s like déjà vu all over again.”  The market rout this afternoon (Tuesday, August 25, 2015) felt a lot like 2008.  How should a business owner react?

While the 2008 crisis was triggered by credit issues in the United States, today’s crisis trigger is China and a plunge in commodity pricing.  Some of the commodity price pressure was also caused by a China slowdown, so at least for now, China is the epicenter of the crisis, rather than the US.

If you are a business owner considering selling some or all of your business, or if you want to raise equity or debt capital, what does this mean to you??

If we go back and look at a variety of financial calamities, there is one common denominator.  Whether it is the Russian debt crisis, the Asian currency crisis, the 1987 market meltdown, or the more recent 2008 Lehman Brothers, Enron financial meltdown, or last month’s Greece default and China today, investors step back to see what will happen next.  In stock investing, one learns not to try to catch a falling knife – it can be painful.

Banks always react after the crisis is out of control. 

Greece: Potential Implication to Selling Your Business

If you’re like me, you’re tired of hearing about Greece and how this tiny part of the EU is upsetting equity and debt markets worldwide.  But if want to sell your business in 2015 or 2016, then you need to be alert to what’s happening beneath the headlines.

As I write this today, the equity and debt markets are the strongest and most available since early 2007.  Private equity and corporate cash is at record levels and we are seeing more interest in good deals than perhaps at any time in the last 10+ years.  Debt is plentiful, cheap and relatively easy to get.  Prices are at or near record levels for private companies.

Simply put … this may be the best time in at least 10 years to sell.

But that could change in an instant.  If we take a look under the covers of the financial markets and talk to the decision makers, people are getting nervous.   Nervous is bad … all equity and debt markets rely on confidence.  What we all experienced in 2008 was confidence being flushed down the drain.  If someone in Greece doesn’t have confidence in their bank,