Introduction:-
Assume you have a wonderful concept for a new product or service. You're excited, but you'll need money to make your idea a reality. Here's where venture capital comes into play. Venture capital is a sort of finance that investors contribute to companies with strong development potential. In return for their contribution, these investors receive a portion of the company's ownership.
On Wall Street, firms engage in business as sell-side companies, with investment banks serving as facilitators between issuers of securities and investors and market makers who provide liquidity by trading in the public markets. Investment bankers and corporate finance advisors help companies raise funds in the private capital markets by issuing debt and stock.
Sell-Side?
The sell side is that part of the financial sector which creates and markets financial instruments, like stocks, bonds, and foreign exchange, in the public market. It also incorporates private capital instruments, including placements of private debt and equity, in the mix. Sell-side professionals are, therefore, investment banks and brokers who design and service these financial products and sell them to the buy side, usually through institutional and individual investors.
2. Due Diligence:
o Financial Study: Investment banks engage in detailed financial study of the target company, related revenue, expenses, profitability, and valuation.
o Legal and Regulatory Review: He or she carries on legal and regulatory due diligence to identify all risks and compliance issues.
o Building Client Relationships: The success of the corporate client relationship building would be sure to ensure a healthy deal flow and familiarize the bank with their needs.
Key Stages of the Sell-Side Pitch Process
1. Origination of Deals:
o Opportunity Identification: Investment banks are always on the lookout for potential deal opportunities by connecting with clients, industry research, and market analysis.
These specialists have an essential role in the well-functioning of the market, guaranteeing its liquidity. A buy-side player is defined as someone or any firm that buys securities with the intention of later selling them for a profit.
Buy-side players in the financial market are individuals who buy securities with the goal of holding them for future investment. This comprises professional investors such as money managers from hedge funds, institutional firms, mutual funds, and pension funds. Even individual investors can be considered buy-side participants. The private market consists of private equity funds, VC funds, and corporate venture arms investing in early-stage companies. Sell-side includes the market makers that ensure trading by buying and selling securities on their own behalf.
Thus, the sell side is more interested in getting a maximum price for its financial instrument and providing information and research regarding those specific assets. On the other hand, the buy side looks to buy at the very highest price possible for those instruments. Since neither can exist in a vacuum, each depends on the other to counter-balance market forces.
Understanding Sell-Side
The sell-side and buy-side of wall street could not operate without each other and are interdependent. Each relying on the other for smooth operations just like two-sides of the same coin.
On Wall Street, firms engage in business as sell-side companies, with investment banks serving as facilitators between issuers of securities and investors and market makers who provide liquidity by trading in the public markets. Investment bankers and corporate finance advisors help companies raise funds in the private capital markets by issuing debt and stock.
Sell-Side?
The sell side is that part of the financial sector which creates and markets financial instruments, like stocks, bonds, and foreign exchange, in the public market. It also incorporates private capital instruments, including placements of private debt and equity, in the mix. Sell-side professionals are, therefore, investment banks and brokers who design and service these financial products and sell them to the buy side, usually through institutional and individual investors.
Introduction
In this fast-changing business environment, both investment banks and companies need an understanding of the sell-side pitch process. The pitch, which seeks to encourage investors to potential investment opportunities with a well-thought out strategic presentation, is also extremely important for directing capital flows and generating growth. It discusses the sell-side pitch process: most critical stages to roadblocks and industry changes currently occurring.
The more investment banks know about the sell-side pitch process, the better equipped they will be in becoming effective deal makers and correspondingly leveraging themselves as trusted advisors to corporate clients. Corporate clients may, in turn, better understand investor expectations and handle the fundraising process. This article is a wonderful resource for anyone in the investment banking profession, as it provides a clear and basic summary of the sell-side pitch process.