The key reason that many companies seek to join a public market like NEX Exchange is to raise essential capital to accelerate their growth.
The process of raising the required capital is sometimes challenging, with different parties involved and varying advice on offer. How much can you raise? How do you present yourselves to investors? What type of investors should you target and how much will you have to pay in fees? These are just a few of the questions that need to be answered and every company’s circumstances will be different, so there are no standard responses.
It is always worth undertaking plenty of research and listening to advice from people like leading small-cap fund manager Gervais Williams, will pay dividends. There are also many investor relations (IR) specialists who can help ensure that pitch documents are well constructed, that senior staff know how to successfully engage with investors, and that there are clear messages being given on how the capital will be used to grow the business.
Whilst raising money at the time of an IPO can be difficult, it often becomes easier after a company has been on the market for some time and has developed a relationship with the market participants. Last year we saw English wine producer Chapel Down (featured below) raise an impressive £20m, and many other NEX Exchange companies also had successful fund raising events.
Coinsilium and KR1 Plc, our two blockchain focussed investment companies, both raised money during the year, with investors seeing excellent early increases in share prices and impressive trading volumes.
We are delighted to be hosting a conversation with Gervais Williams, Managing Director of Miton Group on Emerging Trends in Small Caps at NEX on 21 February. To register, please click here
Patrick Birley is Chief Executive Officer at NEX Exchange