IPO Specialist – Growth Business

If you want to run your business on AIM, the London Stock Exchange’s market for fast-growth companies, you will need to run a business with all the essential attributes – a strong management team, a sound business model and innovative products and services. Services. A healthy level of sales and profits also wouldn’t go wrong with your IPO.

However, while all of the above are extremely important, they will mean nothing if you do not recruit the right consultants to guide you through the entire process.

Professional, skilled advisors will be able to raise the cash needed for your business growth, introduce you to the right balance of investors (both private and institutional) and most importantly, value your business commensurate with its level of growth. and potential. If all goes well, you should be able to sit back and watch your shares go up at a premium on the first day of trading. This will almost undoubtedly enhance your relationship with your new shareholders and the wider city – that most fickle of institutions.

> See also: Benefits of IPO for a Company

What is the difference between nomads and brokers?

The importance of the nomad’s role in flotation should not be underestimated. Its job is to assess a company’s suitability for a market place, advise on valuation, oversee entry processes and ensure that the company adheres to all rules and regulations before and after the float. An experienced and capable advisor is essential.

Choose a name that best suits your area and the size of your business. “There are different types of nomads out there and I would say maybe have a look at the broking aspects as well because they will understand the market and they will have broker reports that they will be able to access and produce and an in-depth knowledge of your sector, said David Davies, partner at Kingsley Naple.

Your broker’s role is quite simple, that he will raise the cash.

Interestingly, many companies employ as their nomads the same investment house that acts as their broker. The reasoning is that it facilitates a much faster and more efficient float.

Still, there are advisors who simply play the role of nomad – Grant Thornton, for example. The advantage of this, they argue, is that a pure nomad is acting only on behalf of the client, and is therefore more independent.

What should I be looking for in Nomad and Pimp?

Make sure your mover knows your area and has worked with businesses similar to yours. You can find out which businesses they’ve worked with before – more on that in a moment. Making connections early on will help you know if you’re a good fit.

These are the factors that you would also consider while selecting a broker or a combined nomad and broking house.

Especially with a broker, you want a firm that knows exactly how much money you are looking to raise. “Some of the brokers will only raise significant sums, others will raise hundreds of thousands of pounds, which is relatively small in this scheme. Therefore, you need to choose the right broker who knows the sector and will raise the right amount of money,” Davies said. Said.

“If you are looking for nomads and brokers, you should look for nomads first because there are fewer of them. If you went to a broker and hired them, you may find that you limit the number of nomads There are people you can work with.

focus on sectors

Of course, in addition to choosing a broker for their fundraising prowess and nomads for their particular skills, you need to keep in mind that some investment houses specialize in certain areas.

WH Ireland has a focus on mining and resources, Canaccord focuses most on mining, media and life sciences, while Brewin Dolphin has its fair share of technology clients and Durlacher has a penchant for speculative financial services companies .

Most brokers, however, are generalists and can cater to a wide range of areas such as development.

Should I go for nomad and broker in the same firm?

There are advantages and disadvantages to having everything under one roof. Working so closely together means that nomads and brokers can keep each other informed and have easy conversations – plus they’ll work together for different clients based on their collective experience.

Their separation can lead to controversy. Nomad will likely want you to have at least one of your brokers as well as a third party broker as a co-broker, with them probably being the prime broker.

The broking side of it is a very wide pool but for the most part, coming to AIM you will find that most of the companies will use their nomad as a broker if in fact they are one of the people under whom many of them are broking are doing. same roof.

“But I think by separating them you get the impression that what the broker is doing is not being affected in any way by the nomadic duty to the exchange,” Davis said.

Where can I find nomads?

First, it’s easier to find a list of nomads than it is to find a list of brokers because there are fewer of them.

To find a full list of nomads, visit here londonstockexchange.com/adviser, In the top right corner, there is a button labeled ‘Download List’. If you click on this, you will download a document with the company names, their sector, location and a complete list of their consultants.

“I suspect that if you go to most brokers’ websites, you’ll see what they’ve raised money for,” Davis said.

Can I partially convert Nomads through the pre-IPO process?

In short: yes, you can. “It’s really quite simple,” Davis said. “Obviously, if you’ve actually signed the engagement papers you need to look at the terms of the engagement. But I expect the first few meetings you’ll be able to do with the nomads. Just kick their tires, as it tha, and make sure the fit is correct without actually getting too busy.

If you as a company are looking to raise more money, often other brokers will be trying to say ‘well, if you ever have a falling out with your broker…’

Note that you must have a nomad or else you will be suspended. It is worth mentioning here that your nomadic relationship can also break. If the nomads lose trust in their clients – they think the clients are working without notifying them, for example – then they can say, ‘actually we’re withdrawing from being your nomads’. Then you get automatic suspension from the markets until you find someone else.

How much does the pre-IPO cost?

It is very difficult to reduce pre-IPO costs. It largely depends on how much you want to raise and how attractive you are to the broker.

Brokers will also charge a percentage of the amount they raise, and they will probably want warrants, which will effectively be like options for new shares attached to them. Depending on how attractive you are and what the market is doing, it will be in the single figures — probably somewhere between 3-8 percent.

If it’s a small value when you’re going to raise, they probably want a higher percentage. It really can be different.

The annual retainer for Nomad will be in this £30–50,000 range, depending on various factors.

Overall, the price to get into the market will be in the six-figure region, not with a ‘1’ in front.

Thanks to partner David Davis Kingsley NapleFor their assistance with this article update.

See also: pre-ipo finance – The Road to Fundraising Success?

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