I see Jeff Frost is asking on the Venture Capital forum on Linkedin if there is any money being loaned or invested. Here in Canada, our banks have moved onto the list of top largest banks in the world which really is quite remarkable. When you fly across the country, most of it seems unoccupied! Also, we only have six cities with a population over a million while China has 100 cities with 1 million plus people.
So to get back to the question -is anyone putting money into companies?
Yes.
First up the government is handing out sugar plums to early stage companies. But since our banks are very conservative - as they should be we have come to appreciate - it has made room for a very healthy private equity fund industry.
If you have a business generating over $10M in revenues, you are of interest to a private equity fund in your field of expertise. Old style manufacturers, do not despair, as you are of interest too.
Last night, Loewen & Partners had a board meeting with one of our clients who is doing very well with global clients. Two years ago, when we first met, it was not a pretty picture. What happened? We matched the owner with a private equity fund who bought a 35% stake in the business. They also pushed him to do the strategic changes he had always meant to do. We raised capital - over $15M for the company and they had revenues of $35M and a downward trend. So you can see that there are possibilities where your Canadian banker may not wish to go.
The smiles around the table make private equity a great business.
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