Extracting Value in Today's Challenging Financial Environment

When asked about deal making today, the conversation inevitably comes around to extracting value. Deal making needs to be focused on intuitive structure that allows a latitude for fresher ideas to convince the investor their money has as little risk and as much upside as possible. Long gone are the days of "cookie cutter" deals that permeated the landscape not so long ago. We're seeing institutional investors that are trying to find ways to put money into alternative investments such as venture capital to broaden the spectrum of their investments. This should tell you that small to medium sized companies can still grow utilizing macro trends in the financing arena.

My position in this difficult environment is to take basic capital raising tenets and align them with professional capital sources as fast as you can move. How? Persistence and creative thinking are instrumental in getting deals done. Our clients know that a fundamental analysis of their capital needs must be the first step in the search for capital. This is elegant in its simplicity, but the obvious has to be considered: How about getting your existing investors to put up more money at perhaps reduced valuations? A bold move. What's in it for them to "throw good money after bad?" Why not have them re-calibrate their positions in the company before valuations go through the roof...things won't be like this forever and if they liked it once, they'll like it more when your numbers rebound. The key here is to get the money to chase you.

Quarterbacking skills are crucial working on innovative ideas in a tourniquet tight market and delivery of these is critical for capital seekers. Operating with a sense of urgency and solving problems has to be the stock in trade for everyone in the capital aggregation marketplace.

Our contention: go to the money, it won't find you. You'll need more weapons in your arsenal than a tired rolodex of contacts that have been picked over and beat up and were there with you eons ago in a different financial landscape. New sources, new ideas, fresh capital is around, we see it every day. A wealth of contacts is needed to allow you to hit the ground running and delivery of these sources for capital seekers both large and small is paramount. If you have them, exploit them, professionally speaking of course. If not, capital is out there, but creative methods to access it is paramount.