QuakerSmith Capital works with client and investment companies in a variety of ways, depending on the specific circumstances. In all cases, QuakerSmith Capital participates as an equity partner, with risks and rewards aligned as closely as possible to those of the client. Relationships can be in the form of:
Direct Investor: QuakerSmith Capital makes a direct investment, typically between $50,000 and $250,000 in some combination of cash and services value (“sweat equity”) in the client to fund and support an agreed set of actions. QuakerSmith Capital typically prefers investment vehicles such as preferred notes or preferred equity shares, but is open to a wide variety of forms of investments, including warrants, appreciation rights, and so on.
Interim Officer/Part Time Resource: QuakerSmith Capital can provide a resource on a retained basis to serve in a management capacity with a client company. For example, Mr. Smith can serve as Vice President of Corporate Development of a client venture on a part time basis for some defined period of time in exchange for a fixed monthly retainer. The monthly compensation would be a combination of cash and equity interests.
Management Consulting: QuakerSmith Capital can provide a variety services, such as writing business plans, preparing investor presentations, evaluating licensing opportunities, and so on, under a standard consulting fee-for-service or fee-for-deliverable basis. Services can also be provided on a gain share basis, such as a percentage commission on funds raised from investors. Compensation can be a combination of cash and equity interests.
To date, relationships with QuakerSmith Capital’s clients and investments have typically involved all of the above relationship structures in some combination.