ZUVELEKCAPITAL

Capital Raising

Every instrument is priced in writing before a provider is contacted.

A raise turns on one decision made early: which form the capital takes, and what that form costs in dilution and control. We run a five-step process we call Instrument First. It opens by pricing senior debt, structured minority capital and common equity against your situation, and the comparison is written down. It can conclude that the right answer is debt, or no raise at all.

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Debt first

Debt capacity is tested before equity is considered.

Debt is usually the cheaper capital, so the first test is how much debt your business can carry, measured on normalised EBITDA with owner compensation and non-operating costs adjusted. Where debt wins the comparison, the raise becomes a financing and the same adviser runs it under our debt advisory mandate. The instruments further up the ladder are scoped once debt has been measured and found short of what your plan needs.

  1. DebtSenior debtSecured, repaid on a schedule and tested by covenants. No ownership is given up.
  2. DebtUnitranche or second lienPriced above senior debt for more leverage or a junior claim. No ownership is given up.
  3. StructuredStructured or preferredA fixed return ranked ahead of common equity, often with conversion rights and consent over major decisions.
  4. EquityMinority equityA share of the ownership, usually with a board seat and protective rights.
  5. EquityCommon equityOwnership shared in proportion to the stake, with voting control moving as the stake grows.
Illustrative. Each step up the ladder costs more and gives up more ownership and control than the one below it. The instrument comparison prices each step against your company.
Debt Advisory

Who this is for

Mandate criteria

Which instrument fits depends on the situation. These are the parameters we work within.

Capital Raising Criteria
Instruments
Senior debt, unitranche and second lien, mezzanine, preferred, convertible and structured minority capital, minority equity and common equity, including capital for defined projects.
Size
$5M to $250M.
Issuer
An operating company, or a defined project with committed management and a use of proceeds that can be written down.
Basis
Providers are identified from comparable funded situations, with the reasoning shown.

Process

How Instrument First runs

Five steps run every raise, from the instrument decision through to documentation and close.

01

Instrument

Every form the capital could take, senior debt through structured minority capital to common equity, priced in cost, dilution and control terms. You hold the instrument comparison as a written document from the first working session, and it can conclude that the answer is a loan, or that there is no raise to run.

  • Each instrument priced on cost, dilution and control
  • Use of proceeds and structure summary

Decision pointWith that comparison in hand, you decide whether to raise, which instrument to raise, and whether a process is worth running.

View a sample
02

Evidence

A fund or institution joins the list when comparable funded situations show it writes this instrument at this size, with the sourcing sitting next to the name.

Those comparables come from the firm's origination engine, which reads lender filings to show which providers have funded situations like yours, at your size, on terms that are on the public record.

  • Provider set with the reasoning shown for each name
  • Approach plan and sequencing
How origination works
03

Package

The raise is prepared the way an investment committee will read it, with the materials and the data room ready before the first meeting.

  • Presentation and financial summary
  • Data room built before the first meeting
04

Market

Providers are approached in parallel, with interest managed so terms arrive together. Where the instrument is a security, the offering is yours. You, or your licensed placement agent, make the offer.

  • Managed outreach and provider questions
  • Weekly status on who is engaged and where
05

Terms

Every proposal set side by side on economics, structure and control terms, then negotiated through documentation to close.

  • Term table across all live proposals
  • Support through documentation and close

The instrument is decided on paper before the market is approached. Approaching providers first hands that decision to whoever answers, and the instrument easiest to place is rarely the cheapest one for your company.

Questions companies ask

Before a raise starts

What do you need from us to start?

Financials, the plan the capital funds and the use of proceeds. The first working session produces the instrument comparison, and the mandate is scoped from there.

We already have an offer from one provider. Why run a process?

One offer on its own has nothing to be read against. Running providers together puts it on the term table beside the others, priced on economics, structure and control, so you can see what each one costs. Sometimes the first provider still wins, and you sign with the alternatives written down.

How long does a raise take?

The timeline is set in the engagement letter, stage by stage with weekly dates, and the status report each week shows where every provider stands against it. Three things drive its length: the instrument, because preferred and equity documentation takes longer to negotiate than a senior facility; how ready your financials and data room are when the market is approached; and how many providers are in diligence at the same time.

How are you paid?

Fee terms are set in the engagement letter before any work starts. You pay a fixed engagement fee while the work is done. Where the raise is a securities offering, any fee tied to the placement is structured through your licensed placement agent, and we set out how on the first call.