Capital Raising Resources
Welcome to our curated collection of capital raising information and resources, designed to empower start-up founders and entrepreneurs on their journey to funding success. From free guides to in-depth manuals, our resources cover every step of the capital and equity raising process.
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Capital Raising Resources for Startups and Entrepreneurs
Welcome to our curated collection of capital raising information and resources, designed to empower start-up founders and entrepreneurs on their journey to funding success. From free guides to in-depth manuals, our resources cover every step of the capital and equity raising process.
The Funding Guides intention is to empower individuals to go into the capital raising process with their eyes wide open, and have an understanding of the complex topics and processes involved in raising capital, so founders don't make decisions that have unintentional long-term consequences for the value of their start ups or small business.
We encourage you to download our free resources, to get an understanding of the comprehensive nature of our content, then you can download our individual guides on individual capital raising topics or our Capital Raising bundle for a full end-to-end guide on everything you need to know about capital raising.
Who are our Guides Designed perfect for?
Our guides are designed for:
- Founders of private companies, small businesses, software companies, tech-enabled service businesses or ecommerce businesses who are in need of funding support to establish or grow their businesses.
- Anyone responsible for capital or debt raising (ie CFOs or Financial Controllers) in private companies, technology companies, tech-enabled service companies or ecommerce businesses
- Anyone interested in starting a software company who wants the 'lay of the land' before jumping into incorporating their company.
- People working in this field globally - guides that are only applicable for Australian start-ups have been labelled that way.
The Funding Guides resources are ideal for capital raisings at the Seed, Series A and Series B level. By the time your at Series C and beyond, you don't really need my help (you're already a pro).
Our Capital Raising Guides:
Funding A Start-up - Where to Start (Free Resource)
We stack rank the best ways to fund your business in the early and pre-revenue years, with forms of non-dilutive funding, grants, revenue strategies and capital raising ideas. This guide demystifies the early stages of funding, helping you set a strong foundation for your capital raising journey, and future sources of funding as you grow and scale your company.
This guide helps you to understand the essentials of evaluating your business’s funding needs, then coming up with some cracking ideas to fund the first versions of your business.
Guide to Funding Rounds
Navigate through the complexities of various funding rounds, from seed to Series A, B, and beyond. Learn how to prepare for each stage, the expectations from investors, and strategies to maximize your success rates. This guide ensures you're well-equipped to approach the right investors and raise money at the right time.
2024 Guide to Valuing Your Business
Valuation is central in the capital raising process and yet can be, entirely subjective. This guide offers methodologies to value your business, taking into account industry standards, financial performance, and upside potential for investors. Gain insights into negotiation tactics with investors based on your valuation. This guide is regularly updated with valuation information from the current market.
Guide to Shareholders Agreements - Common Clauses Used in Capital Raising
Dive deep into the intricacies of shareholders' agreements and some of common-place clauses that will be added by investors during a capital raise. Understand the use of control clauses and schedules to protect the interests of private company, founders and investors. This guide outlines how to understand fair and balanced agreements that support your business's growth and governance.
Model for Calculating SaaS Metrics
Investor metrics are vital for tracking the performance and health of your business. Learn about the key metrics investors care about, how to calculate them, and why they matter. This guide helps you speak the language of investors, making your capital raising efforts more effective.
Guide to Investor Engagement Through the Process
Building and maintaining strong relationships with investors is essential. Discover strategies for engaging investors throughout the capital raising process, from initial contact to closing the deal. Learn how to communicate effectively, update investors on progress, and foster long-term debt and equity partnerships sophisticated investors.
Guide to How a Capital Raise Progresses
Get a clear roadmap of the capital raising process, from preparation to negotiation, due diligence, and closing. This guide provides a step-by-step approach to navigate the equity raising journey efficiently, ensuring you're prepared for each phase and know what to expect. I give you some realistic timeframes and help you manage your expectations.
Guide to Corporate Advisory Services
Explore how corporate advisory services can enhance your capital raising efforts. Get the low-down on when to hire a CA partner, and when not to. Understand the types of services available, the benefits they offer, and how to choose the right advisors for your business. This guide helps you leverage expert advice to secure funding successfully.
Guide to Due Diligence
Due diligence is a critical step in the capital raising process. Learn about the due diligence process from both the entrepreneur's and investor's perspectives. This guide covers the documentation required, common pitfalls to avoid, and tips for a smooth due diligence and capital raise process.
List of Australian Funds, PE & Family Offices
Access a comprehensive list of Australian funds, private equity, and family offices that are actively investing in start-ups and growth companies. We have pulled all of these funds and investors together in a helpful guide, and organised them in a way so you reduce the amount of time you waste contacting investors that are not interested in your product. This helpful list includes funds mandates, areas of investment, industry and past investments. This valuable resource helps you identify potential investors, and avoid irrelevant ones, so you only send your company decks to investors aligned with your industry and funding stage.
Australian Guide to Employee Share Options Plans
Employee share options plans (ESOPs) are an effective way to attract and retain talent, but they are extremely complicated beasts to design and administer. There are also some real quirks with ESOPs in Australia with regard to Australia's tax laws and how regular employees avoid capital gains tax events. Understand the benefits of ESOPs, how to set up a plan, and the legal considerations involved. This guide provides insights into structuring ESOPs that motivate your team and enable companies to align their interests with the growth of your business.
Guide to Rights Issues
Rights issues are where you raise additional follow-on capital from existing and potential investors of issuing company. This involves the capital raising process of setting fair value with investors who have already subscribed to your shares. There are ways to do this that get you more money, and ensure the successful acquisition of working capital. You can use convertible notes and a number of other structures, or simply by issuing more equity.
Capital Raising Bundle
The Capital Raising Bundle is a a combination of all of our guides offered at a discount for purchasing all at once. With this guide in hand, you'll be unstoppable in your quest to raise funds directly, or to engage a corporate advisory partner.
Other Categories on this site
- Complete guide to Debt Raising and Venture Debt: Venture capital funds now are offering a new type of product called Venture Debt, which is a high-interest debt instrument with small equity and dilutionary instruments.
- Guide to Shareholder Debt & Private Debt: There is a lot of capital out there looking for a home in a high interest environment. This is a guide to help you find and structure shareholder or private debt to your best advantage.
- Downloadable Teasers, Pitch Decks and Full Investment Memorandums: We've created a range of super helpful pitch deck templates in Canva and Slides that you can download to use as part of your funding conversations. These just aren't pretty layouts, the decks include comprehensive notes about how to tell your story narratively, precisely what metrics to include in each slide and what investors want to see in your information.
- Free Guide to Australian Government Grants: We've rounded up and explained all of the government grant programs in Australia that you can use to get your idea off the ground, and we've explained how to maximise these grant programs for several advantages.
- Sources of Non-Dilutive Funding: This is our best and most useful guide, as we give you a huge number of ideas to add to your business plan, to avoid raising funds altogether. We help you dream up ways to fund your business through innovative ideas, some easy, some more challenging, so you don't have to sell your equity and dilute your ownership on the balance sheet.
Frequently Asked Questions about Capital Raising
What is the meaning of Capital Raising?
Capital raising refers to the process through which companies generate additional funds or capital to finance operations, assets, growth, or specific projects. Capital can be raised through various methods, including debt raising, equity capital raising, and convertible securities, to support business development, fund new investments, fund acquisitions, or improve financial stability.
Capital is raised from an individual or company with capital (money) in exchange for shares in the company, or interest on the loan or both. In order for the shares to be exchanged, the Company must issue more shares, therefor diluting the ownership of the existing shareholders.
What are Capital Raising Methods?
Capital raising methods can be broadly categorized into equity and debt financing. Equity financing involves selling a portion of a company’s equity in the form of shares to investors, which may include private equity investors, venture capital, and public offerings. Debt financing, on the other hand, involves borrowing funds from financial institutions or through the issuance of bonds, which must be repaid with interest. Other methods of debt capital raise include convertible debt, where debt can convert into equity under certain conditions, and strategic partnerships that provide capital in exchange for business advantages.
What is the meaning of Capital Raising Activity?
Capital raising activity encompasses all efforts and transactions a company undertakes to secure additional funds for its operations or growth. This includes preparing and presenting financial statements to potential investors, engaging in negotiations, and finalizing the terms of equity or debt issuance. The goal of these activities is equity raise, to which funds raised to enable investors to provide additional capital to the company, ensuring its growth, expansion, or the successful execution of specific projects.
Why would a company Raise Capital?
Companies raise capital for a variety of reasons, including (but not limited to), financing new projects or expansions, improving cash, or maintaining operational liquidity, acquiring assets through debt or equity together, and refinancing existing debts. Raising capital allows companies to leverage new financial resources to achieve strategic goals without depleting existing cash reserves, thereby facilitating business growth, innovation, and long-term financial health.
Why is it hard to raise capital?
Raising capital can be challenging due to several factors, including stringent market conditions, investor scepticism, high competition for funds raised, regulatory hurdles, and the company's financial health or business model's viability. Investors and lenders seek to minimize their risks, requiring companies that raise capital to demonstrate strong business plans, growth potential, and financial stability.
Successfully navigating these challenges requires thorough preparation, clear communication, and often, strategic professional advisory services. You could start by downloading some of the Funding Guides resources.
What is a success fee for raising capital?
A success fee for raising capital is a commission paid to retained advisors upon the successful completion of a capital raising transaction. It is a fixed income, typically a percentage of the total capital raised and serves as compensation for the advisory services provided throughout the process. It only applies when you've hired a Corporate Advisory partner to raise capital for you (ie, you should not be charged a success fee by the lawyers or accountants acting on your behalf as part of the deal). The rate of pay can vary based on the complexity of the deal, the amount of capital raised, and the agreement between the company and its advisors.
How Long Does Capital Raising Take?
The duration of the capital raising process can vary significantly depending on the method chosen, market conditions, the company's preparedness, and investor interest. Generally, it can take anywhere from a few months to over a year. In our experience at the Funding Guide, most deals done on a purely financial basis take about 6 months, and deals done a strategic basis take longer, usually 12 months.
Equity capital raising, especially through public offerings, tends to take a certain period or longer due to regulatory requirements and the need for extensive preparation and marketing efforts initial public offering.
What is the standard fee for raising capital?
The standard fee for raising capital varies widely based on the method of capital raising, the amount of capital raised, the complexity of the transaction, and the agreement with financial advisors or investment bankers. For equity financing, for example, fees can range from 2% to 7% of the total capital raised. In Australia - 4% - 5% is standard plus a monthly retainer to pay for the fixed costs of the corporate advisor. For debt financing, for example, fees might be lower but can also include additional costs such as arrangement fees and interest payments. It's crucial for companies to negotiate these fees upfront and understand all associated costs.
