AQUEOUS FINANCIAL SERVICES
We are an intermediary funding portal that is involved in all phases of private and public financing within a variety of industries, including cannabis.
Our expertise and access to funds include private securities, private equity, angel investors, individual investors, hedge funds, equity firms and venture capital. We also service companies in facilitating real estate holdings, mergers, acquisitions and public listings.
Institutional firms search for opportunities through Aqueous Finance because our presentation materials, preparation, risk management, analysis and due diligence is consistent and compliant.
Public & Private Financing
While private financing is concerned with the maximization of individual welfare, public finance is concerned with the maximization of a community’s welfare from given resources. Both are based on different rationality's, have scarce resources at their disposal, and both types of financing are repayable. We offer a number of private and public financing options that meet the very specific, and unique needs of each client business. Here are some options.
Private Securities and Transactions
The securities industry is highly regulated, and investment advisors must follow strict guidelines concerning the types of investments recommended and sold to investors. Private securities can be any type of investment, including publicly traded stocks, bonds or funds to non-public investments offered by private parties. They are a trade-able financial asset and broadly categorized into: debt securities (e.g., banknotes, bonds and debentures) equity securities (e.g., common stocks) derivatives (e.g., forwards, futures, options, and swaps).
Transactions are when an associated person (rep) sells securities to public investors on behalf of another party (e.g., as part of a private offering of limited partnership interests, without the participation of the individual's employer firm); or. Transactions in securities owned by an associated person.
We commit a private securities transaction if we have any role in promoting the contact between one of our clients and the outside investment opportunity. This means that just introducing a client to the seller of an unapproved investment would be classified as a private securities transaction. Our personalized discretionary management allows your portfolio to capitalize on market opportunities giving you access to the leading-edge skills and expertise to manage your assets.
Rule 506c of Regulation D (Title of the JOBS act)
First there was Rule 506, under which investors could claim exemption to the requirement of registering securities, however subsequently, Rule 506(c) went into effect in 2013, naming the old rule 506(b)
Under the new rule, you can advertise private investment opportunities (securities offerings) to investors you don’t know under certain conditions. It is now legal to advertise a specific deal to private investors, provided you follow the new rules! Which one applies to you – 506(b) or 506(c)?. It can be confusing. This is where we can help.
Private equity is money invested in firms which have not ‘gone public’ and therefore are not listed on any stock exchange such as “Over the Counter”, “Pink Sheets”, NASDAQ or the NYSE. In general, equity investors require a much more detailed business plan than a plan designed for debt and we include all requirements in an Opportunity Presentation. Depending on several factors, the Securities Exchange Commission (SEC) may also require documentation, circulars, disclosures, and other forms and documents such as a Private Placement Memorandum (PPM).
Venture Capital, Angel Investors and Private Equity Firms
There are three sources of private equity that is invested in businesses by private individuals – not through public markets; Venture Capitalists Angel Investors and Private Equity Firms.
Venture Capitalists (VC) often invest as a group and are typically willing to invest in higher risk ventures than either angels or private equity firms. This makes them very attractive to a diverse mix of enterprises and to businesses that are too small to raise capital in the public markets. While the media likes to glorify venture capitalists investing in startups, the truth is that VCs seldom actually do. Typically, their role comes at a later stage after seed-funding has been satisfied.
Angel investments are usually the earliest investments made in start-ups by wealthy investors who potentially contribute to the new business through their advice and experience apart from their own funds. Angel investors are generally former entrepreneurs who enjoy taking the risk, sometimes even before commercializing of the idea of the new business. They are motivated beyond the pure money return – they desire to serve as mentors for the next generation of entrepreneurs.
Private Equity Firms
A private equity firm (PE) is an investment management company that provides financial backing and makes investments in the private equity of startup or operating companies through a variety of loosely affiliated investment strategies. These include leveraged buyout, venture capital, and growth capital. PE's raise funds sourced from high net-worth individuals and institutional investors such as pension funds, insurance companies, and endowments. They invest these funds in a large cross-section of industries. They seek out existing companies that are ripe for expansion or are under-optimized. Private equity firms accomplish their goals by purchasing smaller companies, increasing their values and selling them at a profit. The process can take several years and comes with high risks. PE firms claim that through higher efficiencies and the power of leverage they hope to earn a high return on their equity investment.
Our expert capabilities to seek funding from a private equity firms, include our network of strategic business partners compatible with your business sector. Our due diligence can help lead to a very positive experience.
Knowing exactly the type of investor your business will need, our advisors do extensive research of individuals or investment groups to find those interested in the particular industry or business.
A Hedge Fund is a limited partnership of investors that uses high risk methods, such as "leverage" (referred to above) which is investing with borrowed money, in hopes of realizing large capital gains. It is regarded as an alternative investment vehicle available for sophisticated investors, such as institutions and individuals with significant assets. Hedge Funds continue to offer investors a solid alternative to traditional investment funds—an alternative that brings the possibility of higher returns that are uncorrelated to the stock and bond markets. The name “hedge fund” is derived from the fact that hedge funds often seek to increase gains, and offset losses, by hedging their investments using a variety of sophisticated methods, including leverage.
Specifically, U.S. laws require that Hedge Fund investors be “accredited,” which means they must earn a minimum annual income, have a net worth of more than $1 million, and possess significant investment knowledge. The popularity of these alternative investment vehicles has waxed and waned over the years, proliferating during the market boom earlier this decade, but in the wake of the 2007 and 2008 credit crisis, many closed with some turning out to be a massive fraud. As a result, our expert advisors are subject to increasing due diligence and risk when suggesting or recommending this option to our clients.
Crowdfunding is the practice of funding a project or venture by raising small amounts of money from a large number of people, typically via the Internet. Crowdfunding is a form of crowdsourcing and an alternative finance. This approach taps into the collective efforts of a large pool of individuals, primarily online via social media and crowdfunding platforms, and leverages their networks for greater reach and exposure.
This fundraising approach can be seen as a funnel, with you and your pitch at the wide end and your audience of investors at the closed end. We aim to point that funnel at the right investor or firm at the right time, otherwise your time and money is lost.
Real Estate Holding Companies
A real estate holding company is formed to own real estate so that the contract and ultimately the financing will be in the company's name. Additionally, if you seek financing, you will pledge the mortgage under the name of the holding company.
Many real estate holding entities are structured as limited liability companies, known as LLCs, which provides you the protection of a business entity, but allows you to claim the income on your personal tax return. While a real estate holding company has definite tangible benefits, it also comes with risks. There are costs involved, including registration and business taxes.
A holding company requires a level of management that can be daunting for an inexperienced business owner which is where we come in. We encourage you to contact one of our expert advisors when creating and managing your real estate holding company and let us guide you through this process.
Mergers and Acquisitions
Mergers and Acquisitions (M&A) is the area of corporate finances, management and strategy dealing with purchasing and/or joining with other companies. They are commonly done to expand a company’s reach, expand into new segments, or gain market share. All of these are done to please shareholders and create value.
In a merger, two organizations join forces to become a new business, usually with a new name. Because the companies involved are typically of similar size and stature, the term "merger of equals" is sometimes used.
In an acquisition, one business buys a second and generally smaller company which may be absorbed into the parent organization or run as a subsidiary. A company under consideration by another organization for a merger or acquisition is sometimes referred to as the target.
There are typically four types of mergers:
1. Horizontal - a merger between companies with similar products.
2. Vertical - a merger that consolidates the supply line of a product.
3. Concentric - a merger between companies who have similar audiences with different products.
4. Conglomerate - a merger between companies who offer diverse products/services.
Given that there are so many different types of M&A's out there, there are also many laws that govern what companies can and cannot do. This is largely because big mergers have the power to impact the overall market, possibly leading to monopolies and other things that are bad for business. There are three major antitrust laws that dictate how mergers can go down and our expert advisors can guide you through the process.
Public Listings on Stock Exchanges
When a business decides to take their company public, it’s a major decision with a lot of steps involved. The goal is to turn your business into a thriving enterprise to attract investors. However, being in compliance with the law also requires a lot of thought and preparatory work.
Before making any decisions, you need to seek out our expert advice to determine if this is the right course for your business and how we can make help make it happen.