The Secrets of Raising Private Capital By Michael Noel, CEO FullStackTLC.com/MichaelNoel Copyright 2016 Eliances. All Rights Reserved
The Secrets of Raising Private CapitalBy Michael Noel, CEOFullStackTLC.com/MichaelNoel
Copyright 2016 Eliances. All Rights Reserved
About Mike Noel• 20-plus years in Finance and Investment Banking• Middle Market Intermediary 10-plus years• Worked on or Originated
• 100’s of Leveraged Buy Outs• 100’s of Transactions• 100’s of millions of dollars in transaction value
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1. Venture Capital2. Private Equity 3. Factoring 4. Crowd Funding 5. Personal Debt 6. Private Raises
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The Number TWO most important Secret is,•Private Capital is the best capital you can get – if done correctly.
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Quickly - Different Kinds of Capital Raise
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Private Equity and Venture Capital• Financial Buyer• No real synergy• No real Strategic Alliance• Just Money, with a return the number one consideration• Their job is to employ Capital
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Angel FundingHard Facts:• 3% get funded• 97% invest time, energy, effort and money for Zero Return• Good practice however
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Crowd Funding• You need some way to get you message out!• Should be called Crowd Renting,• If you do not have a crowd in Social Media, or are pre-prepared
to rent a crowd• The silence will be deafening.
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Types of Creative Private Capital
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Factoring• A financing method in which a business owner sells
accounts receivable at a discount to a third-party funding source to raise capital
• You need to have accounts receivable
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Advantages• Inexpensive (Sometimes)• Allows for more rapid growth• Currently I have 1% per month for the right circumstance 12%
per annum for short time.• (Better than money market for the investor)• Good for Company 12% return for the investor.• Can get pricey up to 30% vig not uncommon• Be careful
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Personal Debt• Services deliver $20,000 to $150,000• Using a combination of• Banks• Credit Unions• Credit Cards
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Personal Debt• They fund these all at the same time• Takes coordination• Do not attempt this on your own• Low percentage rate to begin with• 2 weeks to funding
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Personal Guarantee Your Neck• You can lend the money to your company• Charge your company more that you pay• Pocket the spread
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The Number TWO most important Secret is,• Private Capital is the Best Capital you can get, if done correctly.• Fastest growing Segment• Blue Collar Backers on Discovery Channel
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Process• Got to be able to tell a good story• Complete story• Have to be able to support that story with facts• MVP – Minimum Viable Product• Confused mind says “no”
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Good rule of thumb• No friends and family• Ask them for referrals not money
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Tell you story to as many folks as possible• Good practice
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Tell enough folks someone will get you to a Private Investor
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The Number ONE most important Secret is,• Best Private Investor• Someone with the problem that you solve
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Strategic Alliance• Synergies with your group• Excellent outsourced talent pool• Usually they come with you first few clients (Cash Flow)
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My current work in progress• FullStackTLC.com – First 90 Days• MVP - Done• Zero Debt• 100 k recurring revenue• 2-million-dollar valuation
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Sector - Marketing Automation• Single Investor - PR and Marketing Firm, that had a problem
We solved very nicely.• And we gave him the solution at cost at first.
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The Number ONE most important Secret is,• Best Private Investor• Someone with the problem that you solve
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Process• Go to market with a MVP• Look for the Strategic opportunity• Take it
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Questions• 5 Minutes
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