Are You a Champion of the Small Investor?

Date PublishedJanuary 22, 2015
CompanyCatch Resources Inc.
Article AuthorDale Galbraith
Article TypePULSE Interactive Newsletter Jan. 2015
CategoryPULSE Interactive
Tags, , , ,
HUB SEARCHCatchResources
PULSE Interactive

Are You a Champion of the Small Investor?

What would we do without these unsung conquerors of the investment world? From my perspective our fledging entity would not have gotten off the ground and would most certainly not be in the position to take advantage of the M&A activity soon to engulf the oil and gas industry.trophy4

From day one we have championed the small investor. We revere them to such a degree that I cannot imagine the growth of our firm without their participation no matter how large we become. The challenge, like others in our position, isn’t a lack of respect for these individuals it’s a function of how to appeal to them en masse. Our philosophy to “bring the power and respect back to the retail investor” is a focal point at our company.

Screen Shot 2014-09-24 at 12.23.20These solid, intelligent and sophisticated investors rarely have the opportunity to participate in bought deals or guaranteed upsides of stocks like the larger equity and brokerage firms do. The slam-dunk deals are reserved for the elite and well-positioned, not the blue-collar exemplar with a passion for risk-taking and a belief that great companies can be built from a strong foundation and once set deserve the capital health afforded the corporate conglomerate. These are the champions that for decades the private wealth-builders eschewed, believing them beneath their benchmarks and underserving of their “insider” knowledge.

So where do we find these champions? From my vantage point these brave souls reside within the exempt market. This is the arena of the grass-roots investor, the gladiators of the entrepreneur. They thrive here, ready and eager to thoroughly engage the fledgling entrepreneur in all her glory. What they require in return, as a minimum, is your story, your passion and your commitment.

umbrella_risk_featuredAs one might expect the exempt market is not without its restrictions and regulations. This is for the protection of both the investor and the issuer of shares, and goes a long way in providing the protection the investor deserves. There are several ways to attract investors within the exempt market with the most common falling under the accredited investor exemption.

Another more complex vehicle is the formation of a MFT trust. You may recall that in a previous article we acknowledged that our company was in the process of completing an MFT and was expecting to file in the final quarter of 2014. As fate would have it we did not file within that anticipated deadline (A situation that eventually worked in our favour given the current oil prices). We are now making alterations to our MFT in order to position the offering to take advantage of the upcoming opportunities.

Regardless of your approach to attracting investors within the exempt market, there are some fundamentals to consider before reaching out to these individuals:

• Remember that if you can build a business that grows cash you are in demand.
• Bringing professional expertise to the table accelerates your ability to succeed.
• It’s critical that when you are ready to talk to providers that you present well. Be clear and concise in all aspects.
• Don’t dismiss a certain degree of bank debt. No company ever failed because of a little debt.

• Run your business for the long-term and look for exits as they present themselves.
• Be a champion of the Retail Investors, they are the backbone of the entrepreneur and growth companies. Let them know you value their participation.

thumb.phpA final note on the above that may help save you a good deal of time and money; engage a securities lawyer to help you understand how to function within the exempt market without being offside with the Securities and Exchange Commission. Believe me it is a lot less expensive than you might imagine and will save you a world of hurt should you make a misstep by going it alone (I refer to bullet two above).

searching-for-investors1Lastly, look for the most intelligent individuals you can possibly find to invest in your company. When we have the opportunity to receive capital from individuals I am far more enticed by the prospect of having a highly motivated and intelligent investor provide his capital over all others. I am of the opinion that these investors only enhance our ability to be a much better company.

We champion their talents and extol their commitment, and in return receive a much greater gift. Their capital and their knowledge. It’s a win-win by a large margin so consider being a champion of the small investor and watch your capital raise capabilities increase.

Dale Galbraith

Dale Galbraith is CEO & President of Catch Resources, Calgary, AB, a private corporation focusing on the acquisition of producing and distressed assets
within the micro-junior oil and gas industry.