Hope everyone's doing well!
Wanted to pick everyone's brain about raising capital. My business involves building and selling aircraft, recently this has expanded to leasing aircraft to operators. It has taken a bit to get to this step given the capital-intensive nature of leasing $1M+ assets.
I would like to raise external capital (~$5M to ~$10M) to accelerate this part of the business given that overall margins are strong and it also complements our aircraft building business.
I could see the investment structure play out in a couple of ways:
a) We co-invest with 3rd party investors, i.e. we contribute 25%, 3rd party contributes 75%, leasing income and future aircraft sale is split pro-rata.
b) 100% 3rd party, we build the aircraft and provide lease management services, leasing income and future aircraft sale income is 100%, 3rd party investor.
overall, investors can expect to generate 15% (on the very conservative side) to +50% (assuming they can leverage 50% - industry standard)
the issue I'm coming up against is attracting investors, VC funds are typically not interested as we're not a tech company, financial institutions say we need a longer track record, others issues make sub-debt difficult, and it's too big of a ticket for most individuals or they generally lack sufficient industry knowledge to gain comfort. Thus far, we've only been able to gain interest from high-networth individuals within the industry, but those are sometimes far and few in between.
we could get by for a couple more years until more traditional financial institutions are interested, but I'm confident in our business model and feel with sufficient capital we could meaningfully accelerate the business.
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