Fundraising

In the corporate finance context, the term fundraising has two meanings: (a) corporate fundraising refers to the raising of capital by a company, typically from venture capital, growth or strategic investors. A structured process comprises preparation of the equity story, the targeted approach to investors, term-sheet negotiation and completion of the contract. In addition to valuation, many contractual details — e.g. liquidation preferences and special rights — are important.

(b) Fund fundraising refers to the raising of capital commitments for new private equity or venture capital funds. Central phases are pre-marketing, roadshows with institutional investors, negotiation of the limited partnership agreement (LPA), first closing (from which point investments may be made) and final closing once the target volume has been reached.