Investment Banking
Regal Private Equity
Brokers, correspondents, selling group partners and their accredited investors now have a new alternative investment to explore.
Regal Private Equity financing opportunities include PIPE's and reverse mergers, along with convertible debt securities. And, unlike traditional private placements, Regal Private Equity ’s convertible debt offerings and equity are typically for public companies and contain a built-in exit for participants, using registration rights and/or Rule 144 stock holding-period provisions.
Why Invest With Regal Private Equity?
- Attractive entry point – UPFRONT PRICING
- High risk/high return potential
- Extensive legal and financial due diligence performed on Issuers
- Majority have a built-in exit strategy, path to liquidity
- May avoid longer-term illiquidity of traditional private placements
Portfolio Approach
Given the high risk, speculative nature of these alternative investments, investors should diversify into several different positions, rather than attempting to concentrate in any one issue, regardless of its perceived merits. Furthermore, Regal Private Equity offerings should be considered intermediate and longer term investments, and are not suited for trading accounts.
Built-In Exit Strategy
By virtue of participating in either a PIPE financing or an APO, investors receive restricted shares that are subject to SEC Rule 144. Over time, the shares become free to trade on the public market, when the issuer effectively registers them or when the 144 holding period has elapsed.
Attributes of Corporate Issuers
In screening and evaluating prospective financing candidates, Regal Private Equity assesses many different characteristics and attributes of the companies and of their management teams. Most candidates fall into the category of “late stage venture” capital, where “proof of concept” has already been established and commercialization is beginning to occur. Desirable features include:
- Strong management: experience, breadth, depth, track record, passion, focus
- Low salaries – management with equity incentives
- Favorable industry macro trends and fundamentals
- Emerging industry – in the news/topical
- Future news events & milestones for improved aftermarket trading
- Paradigm shifting technology
- Migration of established industries to Internet Age technology and distribution methods
- Large addressable markets
- High barriers to entry
- Lead time to market – difficult to replicate infrastructure or platform
- Strong intellectual property position/patent portfolio
- Highly scalable business model with potential for rapid revenue ramp
- Backlogs, contracts, licensing agreements – visibility of future revenues
- Business model: annuity income streams (one sale– recurring revenues)
- Attractive competitive, pricing and cost positions
- High gross margins; not capital intensive
- Previous funding rounds – validates model
- Limited cash burn rate – ability to execute business plan without additional capital
- Well-defined “use of offering proceeds”: includes accretive acquisitions
Offerings involve a high degree of risk and are suitable for a select group of accredited individual and institutional investors only.