The Firm will identify commercially viable projects in all sectors of the economy, mainly tech, that have been developed to a point where they can be acquired for a reasonable price or have stalled, whether for lack of development experience or lack of funds. Ax|Capital then provides equity or quasi equity financing but more importantly uses its team, network and experience to develop the projects to a bankable state. In addition, Ax|Capital negotiates, fees for raising debt and equity finance and a success fee when the projects are built.
Quasi-Equity Financing !
Quasi-Equity financing is debt that appears, in some aspects, as an equity investment. Characteristics of quasi-equity financing would include either being an unsecured loan, or being a flexible loan repayment schedule. AX Capitals` Quasi-equity investments are usually based on the company’s future cash flow growth. We use projected cash flow statistics of your company or startup , and we look upon what the future cash flow stream is going to be. Quasi-equity financing is used when debt financing and share capital are not possible options of financing. Quasi-equity is dissimilar to a loan in the sense that quasi-equity financing is dependent upon how the company performs in the years to come. Quasi-Equity Financing is dependent upon how the company does in the future, which means that we must have as much data as possible in order to minimize the risk that is possible when investing in your company or tech startup .
Flexible terms
Quasi-equity financing involves tailor-made repayment terms, with a typical duration of two to eight years. Commonly, no principle repayment is required for the first year or two. Options can also include balloon payments ( repaying the entire loan at the end of the term ) and cash flow sweeps ( partial repayments when extra funds are available ).
“ The idea is to allow you to keep more cash in your company during the critical first few years ”
Private Equity
In simple terms, private equity investors are individuals or firms who invest capital into a company in return for a percentage of a business’s sales. In some cases, private equity investors may even buy out public companies so as to gain complete control of them. For a long time, private equity investors only did business with multi-million-dollar companies. Only recently have they expanded into small business financing.
Some businesses prefer courting private investment rather than trying to get a loan from the bank because they feel that private investors will allow for greater flexibility. After all, they reason, with private equity financing they don’t have to pay back interest, or monthly rates to the bank. And they can use their new capital on just about anything to improve their business. However, private equity financing has a number of downsides that too many business owners overlook.