AutomAIT

Mandate 05 · Raise

Capital raise

Growth, structured minority, and debt raises in the band where there is no clearing price, only a list.


The position

Capital for a company in this band does not behave like a market. Each provider has a mandate with hard edges — cheque size, sector, structure, control, geography, whether their own fund is in its investment period — and a company that fails one of them is not priced worse. It is not priced at all.

The provider's answer arrives in a form that resembles a valuation disagreement, which is how founders come to believe they have been marked down when they have been screened out.

How it runs

Structure is settled first. A business that cannot be funded as growth equity at the price the board wants is frequently fundable as a structured minority, a unitranche with a small equity strip, a divisional sale, or a partial secondary that resets the register before the primary is raised. Each has a different set of providers and the sets barely overlap.

The list is then defined against that structure and worked in order, opening with a party that has done the shape before. Volume works against a raise in this band, so nothing is sent to a party who could never have transacted.

What it holds

A short process with providers who can price the risk, and a term sheet that reflects the structure rather than whichever fund had the loosest mandate that quarter.

One company per sector at a time. We do not take two raises that would meet the same providers.


PerspectiveFinancing the Lower Middle MarketWritten for founders and boards raising capital.

Contact

By mandate.

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