Market Down but plenty of companies seeking Capital - Len McDowall
The share market is somewhat unpredicatable at the moment and the appetitie for new Initial Public Offerings (IPO’s) has all but ground to a halt. However that doesn’t mean that there are not still a large number of companies seeking capital.
As a matter of interest I thought I would share with you the types of deals that I have recently assessed, the industries, the typical phases they are in and the investment required.
Industries include:
Web Hosting, Resources (mineral deposit), Funds Management (Business Loans), Property Development, Energy Market (New Competitor - Retail Energy), Wireless Telecommunications (Modems), Employement Website, Pet Foods.
The majority of these companies are either Start Up or Early Stage, with only a small percentage looking for capital to expand their business. The average capital required is around $1M however some opportunities are seeking as high as $20M.
As mentioned in my previous blogs many investors due to the current market are not looking for start up businesses or entreprenuers with agressive growth plans, they are looking for businesses that can show a solid business plan, strong management team and conservative strategies. The majority of deals I have reviewed lately are startup or early stage and the market is turning against entreprenuers. Business models are more than ever being questioned, more research will be done by investors, more extensive diligence processes, more information asked for and required to be supplied. For the startups and early stage opportunities, theire are still funding opportunities but more than ever the business will need to ensure they are “investor ready” and have a solid business plan and strategy.