Companies looking for investment
Companies looking for investment:
Why is it sometimes right to sell shares (equity) instead of taking out a loan?
If both you and the prospective lender believe that your company can pay the interest and capital repayments when due, and there is enough acceptable security (and perhaps personal guarantees from shareholders), a bank loan and/or an overdraft might be the right answer, and we can probably help with that.
However, if the company needs money for the long term, and its success is too uncertain for a lender, the right solution might be to sell a stake in the business (equity finance). It would also give the company more stability. For example if the business becomes loss making a bank would still demand payment of loan interest and capital, whereas company law could prohibit the payment of dividends on shares (thus keeping essential cash within the business).
Is equity finance just for start-ups?
No. Business angels and venture capital funds are very keen to invest in established businesses that need capital for expansion, and in MBOs (management buy-outs) and MBIs (management buy-ins).
Must I give away a slice of my business?
You don't give anything away. An incoming investor would buy shares in your company at a price that you both agree. If you don't agree on price, you don't proceed.
How long does it take?
We have raised capital from business angels in 2 months from start to finish, but depending on the complexity of your business it might take up to 6 months from starting the process to receiving investment
Must my business be high tech?
No. For businesses to grow and be sustainable they need competitive advantages and other commercial strengths, and that is what investors look for
Will I lose control of my business?
Whether you borrow from the bank or take on external investors, they all expect to have a say in what you do with their money. You should enter into a Shareholders Agreement with your new investors and that will clearly define your relationship before it starts. Remember that if the business struggles an equity investor will help you to turn it around, whereas a bank's primary concern is to protect its security and recover its debt.
What are my chances of raising capital?
Ultimately your success depends on the strength of your proposal, but we will only accept your company as a Minerva client if we believe there is a realistic probability of success.
Must I move to University of Warwick Science Park to use your services?
No. But ideally your business should be based in Birmingham, the Black Country, Coventry, Herefordshire, Shropshire, Staffordshire, Warwickshire, Wolverhampton or Worcestershire.
How much will it cost?
Minerva's top priority is to help our client companies to grow bigger and faster, rather than maximising our own income. But our charges are low (relative to others - check for yourself, then come back) because we are specialists and are selective about the companies and investors we work with, not because we cut corners.
Reviewing your Business Plan or your Executive Summary and within 2 working days giving you feedback on your funding proposal: this service is free.
Acceptance as a Minerva client: raising capital is a skilled and labour-intensive process, so we can not afford to expend our resources on companies that are not committed to seeing it through. That is why companies accepted as a Minerva client are asked to pay a £195+VAT Commitment Fee. This is intended to be a filter, not a barrier. We do not offer a "free listing" service because if we think your proposition has merit we want to hit it hard straight away. A basic "free listing" rarely achieves anything on its own, and can delay the proper search by several weeks.
On receipt of investment: an Administration Charge becomes payable, calculated as a percentage of the amount raised (a "success fee"). The percentage is agreed before you become a client, and will be in a range from 1% to 4% depending on the amount being raised and the complexity, so tell us about your investment proposition and we will give you a precise answer.
Please note: unlike parts of the commercial sector we do not require you to either pay a monthly retainer or grant us share options (the ability to buy a stake in your company at a preferential rate at a later date).