Top 10 Tips For Sme Equity Capital Raising In Australia

MEDIA RELEASE
Sydney

Top 10 Tips for SME Equity Capital Raising in Australia
By Dan Liszka

Entrepreneurs looking to raise capital for their venture need to position their companies for the market upswing, and they need to be aware that investors in this climate are looking for great value.

So what are the top 10 tips that entrepreneurs should consider when raising equity capital in Australia?

1) Write a good business plan - with realistic financial projections.

2) Establish a Public Limited Company - it is illegal for Pty Ltd companies to offer shares to the general public without a prospectus. Equity capital raisings are governed by specific sections of the Corporation's Act.

3) Appoint a minimum of 3 knowledgeable, well-networked and experienced board of directors.

4) Explore all avenues of capital-raising - VC and Angel Investors are not the only way to raise capital in Australia. If managed properly, it can be easier to sell 20 x $50K parcels than finding and converting one investor for $1M!

5) Create an investor-friendly environment. Use facilities such as trust accounts, cooling off periods, minimum subscription amounts, professionally prepared offer documents and share certificates, all of which give investors confidence.

6) Structure the offer to make it attractive to early and later-stage investors. Don't get greedy, but don't give away too much equity in your business.

7) Articulate your offer to investors correctly. They may be interested in the product/service or technology, but are more interested in what realistic returns they might see in the future.

8) Set clear milestones for your business over the next 3 years and provide an exit strategy. Investors want to be able to track and access your progress towards an exit strategy in the foreseeable future.

9) Create and practice a professional pitch presentation. Remember . what's in it for the investor?

10) Correctly market the offer and ensure that you are compliant with ASIC's rules and regulations. Most entrepreneurs don't realise the legal minefield associated with capital raising.

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Dan Liszka is Managing Director of Alchemy Innovation Development
www.alchemyequities.com.au.

Alchemy is holding a Stepping Up program . Becoming Investor Ready . Preparation for an Equity Capital Raising in association with the NSW Department of State and Regional Development. For more information, see www.alchemyequities.com.au
. ENDS .

For further information please contact:
Brianna Power - Affinity Marketing
[email protected]
(07) 5520 7615 or
0403 904 912

SOURCE: Alchemy Innovation Development