Raising equity capital is a structured exercise. It rewards preparation, discipline and controlled engagement with investors. Our process is deliberate and staged, and aimed at securing the best outcomes for our vendors.

1. Initial Assessment and Strategy

We begin with a confidential discussion to understand your business, growth plans and the amount of capital required. We assess investor suitability, likely valuation range and the type of investor that best fits your objectives. Some owners want a passive shareholder. Others want industry experience at the table. Clarity at this stage prevents misalignment later. We ensure that you fully understand the process, likely costs: financial and the amount of your time required. At the end of this stage you will have all of the information needed to make an informed decision.

2. Financial Preparation and Positioning

Investors expect credible, well-presented financial information. We work with you to ensure financials are clear, defensible and aligned with a defined use of funds. Forecasts must be realistic and grounded in operating performance. This stage is about positioning the opportunity properly before it reaches the market.

3. Investment Summary and Investor Narrative

We prepare a concise investment summary that explains the business model, competitive position and growth strategy. This is not legal documentation. It is a disciplined commercial presentation designed to attract serious interest while protecting confidentiality.

4. Targeted Investor Identification

Using our investor database and market knowledge, we start by identifying private investors whose mandate, sector interest and pockets align with the opportunity. This is targeted outreach, not broad advertising. Quality matters more than volume. We may need to cast the net wider, as some investors can be industry agnostic. With an extensive database of 7,000 at our disposal, we have options available to us.

5. Confidential Approach and Qualification

The identity of your business remains confidential until we have thoroughly vetted each potential investor. Interested parties sign confidentiality agreements and we vet them by discussing their experience, what funding they have, their situation, expectations, and intended involvement, before they receive any information whatsoever. We qualify genuine interest and filter out speculative enquiries to protect your interests and time.

6. Management Meetings and Negotiation

We coordinate discussions, manage expectations and guide negotiation on valuation and key commercial terms. The aim is to foster informed competitive interest, so you are negotiating from strength rather than necessity.

7. Due Diligence and Documentation

Once terms are agreed in principle, the investor conducts due diligence. Legal documentation is prepared and reviewed by the respective legal teams. We continue to manage process, timing and communication to keep the deal moving.

8. Completion

Funds are transferred and shares issued. Our success fee becomes payable on completion. Throughout, our interests remain guided and aligned with yours.

Within our substantial database, we are confident that there will be a number of well matched parties for your specific project.

Valuation is not a marketing number. It is a commercial assessment of performance, risk and future potential.

In the $500k to $10m capital range, investors generally focus on three core factors.

1. Earnings and Cash Flow

Sustainable earnings underpin value. Investors look at normalised EBITDA and free cash flow to determine what the business truly generates once one-off or discretionary items are adjusted. Stability attracts stronger pricing. Volatility attracts a discount.

2. Market Comparisons

Comparable transactions matter. Investors consider what similar businesses have raised capital at or sold for, usually expressed as a multiple of earnings. The multiple reflects sector, scale, growth rate and perceived risk. Not all earnings are valued equally.

3. Risk and Growth Outlook

Customer concentration vs diversity/spread, reliance on key personnel, debt levels, competitive position, and economic performance all influence valuation. At the same time, credible growth initiatives can support a stronger multiple. Credible is the operative word.

Most capital raise deals do not fail because of a lack of capital. There is plenty of money out there.

They fail because there is a misalignment between price expectation and reality.

Business owners base price on effort, history, and potential. Investors on risk, cash flow and what they can verify. The gap between those two views is where most deals fall over. Investors do not pay for what might happen. They pay for what is proven and what is probable.

Can both parties reach common ground on price? We believe that it’s essential to address this as early as possible otherwise a great deal of time and money is wasted. If a price sits within an agreeable range, even loosely and subject to broad terms, the deal is worth progressing.

The solution to reaching this common ground lies in: realistic financials, sensible and defensible discounted cash-flow assumptions and valuation range, and a process that brings multiple serious investors to the table at the same time.

Capital is available and looking. The outcome depends on how realistic both parties are prepared to be.

A wholesale investor is someone who meets specific criteria under New Zealand financial markets law and can invest without the full retail disclosure regime. In practice, most mid-market equity raises rely on wholesale investors to remain compliant and cost efficient.

An investor may qualify if they have net assets of at least NZD 5 million, or gross income of at least NZD 1 million in each of the last two financial years. Others qualify by certifying sufficient investment experience with independent confirmation. A further pathway applies where a minimum subscription of NZD 750,000 is made and statutory conditions are met. Certain institutions and large entities are automatically wholesale. Most “Mums and Dads” are not.

For raises between NZD 500,000 and NZD 10 million, targeting wholesale investors is typically the most practical approach. The Barker database includes more than 7,000 active contacts, many of whom meet wholesale thresholds or have prior investment experience. Each investor’s status is verified before any offer proceeds, ensuring compliance while preserving access to a deep pool of private capital.

In an equity raise, valuation is often discussed in two parts.

Pre-money valuation is what the business is worth before new capital is invested.
Post-money valuation is the value of the business immediately after the capital is injected.

For example, if a company is valued at $3m pre-money and raises $2m that will allow it to successfully expand EBITDA over five years under a generally accepted growth strategy, the post-money valuation will very likely be much higher than the sum of the pre money value plus investment ($5m) because the business is well poised then achieve that growth. The business value at that point depends on (amongst other things) the net present value of those EBITDA cashflows after an appropriate discount rate is applied. The investor’s ownership percentage is calculated against the post-money figure.

Well-deployed capital should increase the underlying enterprise value over time. If the funds accelerate growth, improve margins and reduce risk, the business should be worth materially more than its initial post-money valuation in the future. That is the objective. The raise is not just about ownership dilution. It is about increasing the size of the pie.

In practice, valuation is a range rather than a fixed number. Where you land within that range depends on preparation, positioning and the quality of investor engagement.

An NBIO is a Non-Binding Indicative Offer.

It is an initial written expression of interest from an investor that outlines the proposed valuation, the amount to be invested and key commercial terms. As the name suggests, it is not legally binding. It signals intent, not commitment.

An NBIO typically includes:

• Proposed pre-money valuation
• Amount of capital to be invested
• Percentage shareholding sought
• Broad conditions, including due diligence
• Any key structural terms

At this stage, the investor has reviewed summary information but has not completed full due diligence. The NBIO allows both parties to assess whether there is sufficient alignment to proceed further.

Importantly, an NBIO is a negotiating document. Terms can and often do change once detailed financial, legal and commercial due diligence is undertaken. However, a well-structured process can encourage stronger NBIOs by fostering credible competitive interest.

In short, an NBIO is the first serious step towards a transaction. It clarifies intent and establishes a framework for moving to binding documentation.

Some NBIOs are expressed on a pre-money valuation, which is the value of the business before new capital is invested. Others reference post-money valuation, which is the value immediately after the investment is made. The investor’s ownership percentage is calculated against the post-money figure.

It depends on both ownership percentage and the rights attached to the shares.

In New Zealand, a minority shareholding does not automatically confer control. However, investors may negotiate governance rights such as board representation, information rights or veto rights over major decisions. These can influence practical control even where the shareholding is below 50 percent.

A holding above 50 percent generally provides voting control. Certain major decisions require 75 percent approval under the Companies Act, which makes substantial minority positions commercially significant.

In some cases, particularly for companies subject to the Takeovers Code, the 30 percent threshold is also relevant. Crossing that level can trigger takeover obligations and materially change the dynamics of control.

Control is therefore not just about how much equity is issued. It is about the structure agreed, the rights attached and the regulatory framework that applies.

Not every capital raise proceeds to completion. Market conditions change. Due diligence can uncover issues. Valuation expectations may not align.

A structured process reduces risk, but preparation is key. Clean financials, realistic pricing and clarity around growth strategy materially improve the likelihood of success. Even where a transaction does not complete, the discipline of preparation often strengthens the business.

Timeframe is one of the biggest unknowns for business owners. In the mid-market, a disciplined equity raise generally takes three to six months. Preparation can take four to six weeks. Investor engagement and negotiation often take another six to ten weeks. Due diligence and legal documentation add further time.

Owners who begin the process early, while the business is stable, typically achieve better outcomes than those raising capital under pressure.

Not all capital is equal. Some investors are passive and expect periodic reporting with minimal involvement. Others bring governance discipline, sector experience and active strategic input.

The choice depends on the owner’s objectives, appetite for external influence and the complexity of the growth plan. Alignment at the outset avoids tension later.

An equity raise involves a number of formal legal documents. These are prepared by your legal advisers. Our role is to coordinate the process and ensure commercial alignment before the documentation is finalised.

Share Subscription Agreement

This is the primary investment document. It sets out the amount being invested, the price per share, the number and class of shares issued, and the conditions that must be satisfied before completion. It also contains warranties given by the company and sometimes by shareholders.

Shareholders’ Agreement

Where there will be more than one shareholder, a shareholders’ agreement governs the relationship between them. It typically covers governance, board composition, decision-making thresholds, dividend policy, pre-emptive rights, exit mechanisms and dispute resolution. This document has more long-term significance than the subscription agreement.

Amended Constitution (if required)

In some cases, the company constitution is updated to reflect new share classes or specific rights attaching to investor shares. This may include dividend preferences, liquidation preferences or voting rights.

Board and Shareholder Resolutions

Formal resolutions are required to approve the share issue and any changes to governance. These ensure compliance with the Companies Act and the company’s constitution.

Well-structured documentation protects both parties. Clear commercial agreement before lawyer’s draft documents reduce cost, shortens timelines and limits the risk of late-stage renegotiation.

In a capital raise, a “black box” process refers to a controlled method of engaging investors while protecting sensitive information.

In its simplest form, it means that key commercial details are disclosed only in stages. Initial information may be summarised or redacted. Detailed financials, customer data or proprietary information are released only after confidentiality undertakings are signed and investor interest is qualified, as approved by the Vendor.

In some transactions, a black box approach can also involve limiting direct interaction between investor and management during early stages. Communication is managed through the broker to ensure consistency of information and to prevent premature disclosure of commercially sensitive details.

The purpose is not secrecy for its own sake. It is to protect competitive information, maintain negotiating leverage and avoid unnecessary market noise. In a small market like New Zealand, discretion is often critical.

A disciplined black box process reduces risk while still allowing serious investors to assess the opportunity properly.

Yes, you can structure capital in stages. However, the decision should be strategic rather than emotional.

Some businesses choose to raise a smaller amount initially to minimise dilution, with the intention of raising additional capital later at a higher valuation. This can work if the initial capital is sufficient to reach clear performance milestones that materially increase enterprise value.

The risk is undercapitalisation. Raising too little can constrain growth, weaken negotiating leverage and force a second raise sooner than expected. If the business remains dependent on further capital, investors may price that risk accordingly.

A staged raise makes sense when:

• The business can achieve measurable milestones with the first tranche
• Growth will likely justify a higher valuation in the next round
• Cash flow remains stable throughout the period

Preserving shareholding should not be the only objective. The more important question is whether the capital deployed increases the overall value of the business. Owning a smaller percentage of a materially larger company is often the better outcome.

The short answer is yes, we can certainly assist.

While our primary focus is equity capital, we work closely with two well-connected commercial finance brokers with many years of experience in brokering bank debt facilities for businesses of all sizes. We often collaborate with them when advising on equity raises or business sales.

Debt can be a cost-effective component of a funding strategy. Unlike equity, it does not dilute your shareholding. In many cases, the optimal solution is a balanced structure where debt is used alongside equity to minimise dilution while still providing sufficient growth capital.

The key is getting the balance right. We can help you assess whether debt should form part of your funding mix and develop a strategy that aligns with your risk profile, growth objectives and long-term ownership goals.

Most private equity firms are registered within our database and are included when we cast the net. It is important to consider all credible capital sources.

Many PE firms have a particular focus. Some specialise in defined industries and may already hold investments within that sector. Others are more agnostic and focus primarily on growth potential, governance and scalability rather than industry type.

Private equity can bring significant value. They often have deep capital reserves, disciplined governance frameworks and experience in accelerating growth. That said, PE transactions are frequently structured around performance targets, earn-outs and milestone-based outcomes. This level of oversight and accountability suits some owners and not others.

The question is not whether private equity is good or bad. It is whether it aligns with your objectives, appetite for partnership and long-term plans.