Financial Sponsor Coverage Group – What to Look For When Applying For a sponsorship

Private Equity and Business Lines of Credit: The Financial Sponsorship Group by Steve Nelson focuses on bringing successful and strategic private equity and business lines of credit to clients. Managing partner financing and private investor investment are two of the most important aspects of private equity. With the support of a Financial Sponsor, these deals can be consummated quickly and with minimal risk. An investor will receive priority shares in a companies stock issued through a private placement if they are successful in their bid. There are a number of primary financial sponsors which include venture capitalists, venture capital firms, private equity firms and senior bankers.

Corporate Finance:

The goal of a corporate finance group is to bring successful senior bankers to private investor meetings to discuss investment opportunities and overall corporate finance needs. The company bringing in an investor will need to be a strong player in the investor’s ecosystem and have a history of bringing in successful senior bankers and or investors. They are also able to provide the additional expertise needed when working with management teams in the banking industry. Corporate finance groups are often funded by venture capitalists or angel investors.

Alternative Investments:

Capital funds are another focus for financial sponsors. These investment banks may not work with a private investor but instead, work with the end investor. They are able to provide more aggressive financing to the end investor when needed and also provide a higher degree of asset protection for the managing director. The managing directors may not have the experience needed or may lack a track record of achieving success in investment banking. The purpose of a fund like this is to provide both the end investor with more aggressive funding options and also provide the managing director with asset protection.

Middle Market:

A middle market is a group of investors that are typically from families with medium to large incomes. This group has the ability to afford to purchase shares at a more aggressive pace than the upper market but does not have the capital to do so. The middle market will often times invest in private equity firms or venture capital investments. One of the advantages of working with middle-market firms is the fact that they may be able to pay more when necessary.

Investment Banking Experience:

If an individual wants to work with private equity firms or venture capital investment banks they will want to have a background or experience in investment banking. Many brokers will recommend to potential clients that they start out with a four-year degree or other types of business degree. This helps to ensure that the individual will be able to learn various investment banking practices while gaining the skills that are required to be successful in the industry.

Business Lines Of Credit:

A variety of financial sponsors will be able to provide investors with lines of credit. This includes traditional private equity firms, business lines of credit and other lines of credit that can be used when necessary. These business lines of credit can help to finance projects or activities that are not able to be financed through conventional means. A variety of investors are interested in providing this type of funding. This allows investors to quickly obtain money when they need it without having to wait for conventional private equity firms to be open for business.

Extended Deals:

Most individuals interested in working with investment banks or other types of financial sponsors will want to have extensive experience working with these types of firms. The individuals should be experienced both in dealing with senior bankers and also in working with junior bankers. A variety of sponsors will hire individuals who have significant experience with one or two different types of banks. Having experience with handling senior bankers as well as working with junior bankers is extremely important.

Middle Market Financial Sponsors:

Middle market financial sponsors will oftentimes hire individuals who are experienced with working with junior bankers and with investment bankers. This is because of the wide range of expertise that these professionals bring to the table. Middle market firms will also typically pay a higher fee for individuals with more experience than companies that hire an entry-level investment banker. This is due to the fact that these middle-market firms will be looking for someone who has a combination of expertise with those that are experienced in private equity. Most middle-market firms will also seek out individuals who have extensive amounts of industry exposure. These are all important things to look for if you are going to find success working with middle-market financial sponsors.

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