Steps to Growth Capital New Tech Case Story

New Tech Case Story — Step 6

The Challenge: Finding Compatible Investors

With the investment proposal nearing completion, New Tech must now identify potential investors. But where to start?

Stuart Chip (New Tech's CEO) calls Grant Argent (New Tech's financial advisor) for a meeting with Elizabeth Pratt (New Tech's in-house accountant) and himself. Grant explains that there are different categories of investors: angel investors, institutional investors, venture capital firms, labour-sponsored venture funds, government-backed corporations such as the Business Development Bank of Canada and so forth. Each investor has investment preferences, making some more attractive than others.

Grant emphasizes that it is critical to ensure that the potential investor matches New Tech's priorities and objectives. Stuart indicates the criteria he feels are important in selecting an investor who will be compatible with New Tech's needs.

Elizabeth Pratt consults with Tony Lee of Smith & Smith, New Tech's solicitors, to determine if there are any exemptions in the securities the company could qualify for and how this would affect its investor contact program.

Key Tasks

To identify appropriate investors, New Tech must:

• determine its criteria (as it did above);
  
• draw up a short list of possible investors;
  
• rank and assess them to see which investors match its needs; and
  
• pick its top choices.

Read how New Tech built a short list of prospective investors.

See how they ranked the investors.

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