Step 1 – Application and Review

Entrepreneurs attempting to raise capital to grow their business should begin the process by submitting an application for review. We recommend that you read all the pages on this site before submitting an application. Our funding application form can be downloaded and submitted from this website. The information you provide in this form is the information we use to make our initial assessment. Please understand that we will not sign Non Disclosure Agreements (NDAs) and recommend that you leave out any particularly sensitive information from the initial application form. There are no exceptions.

Our investment team will review the investment proposal outline provided in the funding application form that you submit. We will contact you within 14 working days should we decide to move forward. Applicants that do not meet our investment criteria will not be contacted. We do not have to see a business plan at this stage.

Step 2 – Presentation Meeting

If your proposal appears to meet our criteria, we will arrange a personal meeting, shortly after your have been contacted.  This will be attended by at least two members of our team and should be attended by as many of your team as needed to give us a full picture of your company. We would normally ask for a copy of your business plan at this stage and, if you have appointed advisers, it is recommended that you are accompanied by them at this time.

Following this initial meeting we will normally let you know by e-mail or telephone within 14 working days if we wish to proceed further with your proposal.

Step 3 – Assessment, Deal Structuring and Submission

Assuming that you wish to proceed, from this point onwards we will assess the key parameters of your business, which will involve:

•Providing detailed information about your proposal and the people within the company

•Meetings to discuss commercial and financial aspects of your proposal, at least one of which we will need to meet your full team; it is commonly our practice to visit the work place facility or headquarters that provides the service or manufacturers the products that is seeking our investment.

•Discussion and agreement of the structure of an investment with you and your advisers; and

•Discussion and agreement of the terms with the co-investors.

Step 4 – Approval and Offer

Having agreed to the basis and structure of a potential investment the firms investment manager leading the deal will write an investment case proposal for submission to the Fund’s investment committee. Committee meetings are held however, no schedule will be advanced on behalf of one investment. At this time we will not accept any additional communication with changes or modifications of the original plan, unless we find it necessary for adjust structure for approval committee approval.

If the investment committee approves the investment, an offer letter will be written to the company outlining the terms and conditions of the offer, which will be subject to due diligence.

Step 5 – Due Diligence & Legal Review

Commercial and financial due diligence is undertaken to confirm the accuracy of the information that has been supplied. There will not be any exceptions.  Due diligence involves the examination of your company or proposal by experts both from Red Cardinal as well as from external sources, such as industry specialists and professional accountants. These reports may contain a number of recommendations to help you develop and grow your business if we are to invest.

The final investment memorandum will only occur if the results of the due diligence work are satisfactory. Legal documentation will be drawn up as part of the process and you will be asked to warrant the information provided to us. Costs of the due diligence and legal process expenses may be paid out of the investment upon funding.  However, if it is warranted or extraordinary circumstances exist, it may be required by the investment manager to provide prepayment of certain items.

Step 6 – Completion

At completion of the legal documents sign-off, cash or the equivalent will be invested into your company in exchange for the agreed combination of shares , stock etc. It may be that we will require the company management at or after completion of the investment meet certain conditions and the investment may be made subject to the fulfillment of these conditions.

Step 7 – Post-Investment Support/Follow-On Funding

A condition of the investment is that your company has adequate financial systems and controls. You will need to provide regular reports on business and financial progress as to be defined in your definitive agreement, including cash flow projections; management accounts audits and quarterly audited financial statements. In the event that during any operation period we find weakness in the financial reporting capability we will identify and hire suitable financial reporting systems specialists to put in controls, which will help you manage your business as it grows, and provide us with the required reports. There are no exceptions. We will also appoint an Executive Director(s) to the board of the company to provide support and advice to the executive directors. The Director will have relevant industry experience or perhaps a skill-set, such as marketing, that complements the skills of existing directors.

Step 8 – The Exit

It is important to be aware that in order to create shareholder value, we must cultivate a structured environment for our new partnership.   We may seek to sell our shares in your company and realize a capital gain, usually within a time certain period or become major voting shareholders. Our investments are structured to encourage shareholder value for all companies we back.