Frequently Asked Questions - Early Stage Equity Capital Raising

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Raising Equity Capital using the Australian Small Scale Offerings Board. This is the first of a series presented by Alchemy Equities, sponsoring members of ASSOB.

What is the vehicle that you use?

- The ASSOB system uses a Public Unlisted company structure. You can either convert your existing company to this format or create a new company and assign all of the technology and IP etc to this new company. This is mandatory to all companies to be able to use the ASSOB system.

- With this structure, companies need to have a minimum of 3 Directors. The structure is setup to fit founders inputs.

What advantages does the ASSOB model provide?

- Low cost
- Class exemptions which allow up to $5million of capital raising within a 12month period rather than standard $2million.
- Reduced risk and liability for directors.
- Access to the ASSOB investor bulletin.

What industry experience is needed?

- The model that we use for capital raising doesn’t require us to know the specifics of your industry. We rely on your experience, while we work closely ...
... with ASSOB.

- With ASSOB you are buying into a system that helps you develop a business and apply a structure to your offer. It creates a vehicle and platform for your business which is investment worthy.

What is the structure of the capital raising?

- Working with you, we will work out when you need Capital and how to structure the deal. Typically the deals are structured with $25-$30,000 parcels in 3 Rounds. The first 2 rounds are each of 10 parcels with the 3rd round focusing on exempt investors (sophisticated, overseas).

- The system is limited by the 20/12 rule where by only 20 investors are allowed within any given rolling 12 months.

- Without the ASSOB exemptions there is also a $2million cap for each 12months, but through ASSOB this can be raised to $5million.

- Many investors are exempt and are not included in the 20 concessions, these include direct family, overseas, sophisticated and professional investors etc.

What is the typical time frame for such listings?

- In theory the offers could be opened in 8 weeks, but usually they are open in 12 weeks – depending on how well developed your plan and team are. There is a lot of work to be done by both you and the Alchemy team to position and prepare the offer correctly. You will be working hard in the lead up to the offer and Alchemy will be pushing you and coaching you along the way.

Alchemy Equities is a boutique corporate advisory firm specialising in equity capital raising for high growth businesses. For more information on grants for small business See http://www.alchemyequities.com.au/