Get the right financing

 

Designing the optimum financing scheme for a corporation can be much easier following the following rules:

  • Balancing risk and return (keep financial leverage reasonable)
  • Matching the cash flows (inflows and outflows from regular business activities)

Loans for business financing have always been a decision directly linked with the success or the failure of the corporation. It is crucial to select the optimum structure of the loan in order to have the loan working for the business and not the business working to pay back the loan.

Some of the issues that have to be decided when designing a loan structure are:

  • Type of the loan – what is going to be financed (working capital, assets)
  • Duration of the loan
  • Payback scheme (time plan, structure and sources to payback)
  • Currency (select a currency that matches your cash inflow)
  • Interest rate (fixed, variable)
  • Collateralised vs Uncollateralised

 

We act on behalf of our clients to structure and negotiate loans with the official banking industry or with alternative financing sources. We have extensive experience in arranging any kind of financing including bond, syndicated or convertible loans, leasing, factoring, forfaiting, overdrafts, etc.

Alternative financing is a rapidly growing business that matches companies need financing with investors, without a banking institution as an intermediary.

Such activities are mainly provided by MarkeiInvoice.com, PlatformBlack.com, Aztecmoney.com for invoice discounting

and by FundingCircles.com, ThinCats.com for short, medium or long term business loans

 

Venture capital

If you have a great idea and you believe that you can turn it into a great business, you should consider financing this effort, partially with venture capital money.

Venture capital (VC’s) funds are investing in companies and get a share in the equity. This means that they undertake business risk and they expect high returns when the company succeeds.  Usually VC’s prefer companies with high growth prospects, which are managed by experienced and ambitious teams who are capable of turning their business plan into reality.

VC funds finance all stages of business activity such as: startups, development, pre IPO, but usually they prefer the early stages financing. The average period of investment is 3-7 years and after that, cash out exit is expected. The exit usually has one of the following options:

  • Sell back to the management
  • Sell to another financial investor
  • Make a trade sale (sell the company, or a stake to another company)
  • Go public (Stock Exchange listing)

We support companies to structure the right financing scheme, contact and negotiate with the suitable VC, prepare the proposal for investment, arrange the structure of the deal, supervise the due diligence and cover any financial issue that may arise until completion of the investment.

 

Private equity

Venture Capital and Private Equity (PE) are often overlapping. PE focuses on equity participation into private companies and usually prefers development and pre-IPO financing.

The process of getting a PE participation is similar to this of getting a VC participation. The PE managers take business risk and expect high cumulative returns at exit. Exit options are similar to those apply for VC’s.

Our services for PE participations are equivalent to those for VC participations.