We'll provide transformative capital where other lenders won't.

We’re a fresh and resourceful lender, who invests the time to understand your business.

Promising Canadian companies often do not have access to sufficient financing to truly transform their trajectory.

For mid- to long-term financings between $5 million and $20 million:

  • Canadian banks do not move outside their well-defined credit boxes that rely largely on tangible assets. They find it challenging to underwrite future cash flows.
  • Equity (from venture capital or private equity firms) is hard to come by, and if it’s available, that equity can prove to be incredibly expensive when the company goes on to enjoy exponential growth.
  • There is growing availability of alternative debt providers willing to take more risk at a reasonable cost, but availability remains limited and many private lenders choose to focus on specific niches.

Therefore, raising this transformative financing is challenging for those promising companies.

This is why we created our Private Credit product. This offering embraces the bold and independent mindset upon which FirePower Capital was founded.

Private Credit can eventually lead to step-change transformation, such as a significant liquidity event, a major up-round, or a string of successful acquisitions.  It can also set the stage for a refinancing on more favourable terms.

What is Private Credit?

Private Credit is a term debt product for companies looking for financing between $5 million and $20+ million.

These companies face the entire spectrum of circumstances, from ‘hypergrowth’ to special or distressed situations.  What they have in common is that they need a lender to spend the required time to dig into those circumstances and to develop a deep understanding of them.

We issue Private Credit loans to companies with a track record of revenues, looking to increase or reassert enterprise value through debt.  These companies may or may not be backed by private equity or venture capital, and are looking to reach a milestone, grow beyond existing lenders’ abilities, or delay their next equity raise to garner a better valuation.

These companies may also be asset originators (like asset-based lenders) looking for unique ways to securitize various asset classes, or to package asset classes together to form a new financial instrument.

What we look for

  • Revenues
    Recurring, repeating, or long-term contract-based revenue model, with low customer churn
  • Visibility into cash flows
    Must have excellent visibility into cash flows (even if negative); if cash flow negative, must anticipate break-even within 18 months
  • Enterprise value
    Business value in an M&A context or value of various asset classes to be securitized can be readily substantiated
  • Forecasting
    Must have deep insights into the future of the business
  • Management
    Operators that share our values, are an impressive and cohesive team, and have financial acumen
  • Location
    Must have a headquarters in Canada
  • Sector
    Industry agnostic
  • Use of Funds
    Generally to support growth, refinancing, buyouts, acquisitions, recapitalizations, asset securitizations, or special situations

Typical terms of Private Credit

  • Loan size
    $5 million to $20 million
  • Term
    12 to 48 months
  • Returns
    Interest rate >10%; Upside: warrants, equity kickers, bonuses, or royalties
  • Security ranking
    First position or second position
  • Disbursements
    Flexible: capital can be made available on closing, or in multiple tranches tied to growth milestones
  • Principal repayment
    Tailored to growth strategy, e.g. deferral of principal payments for up to length of term, large bullet payment at end of term, seasonality adjustments
Market Insights
From the archives: April 2019

Tapping into Private Debt: Unlocking Opportunity
It’s tough to find capital to execute on ambitious plans to grow, acquire or turn things around in Canada, particularly if you’re looking for…

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Case Studies

Mass Spectrometry – Confidential
FirePower generated advised on the sale of an analytical chemistry instrumentation maker, with a strong commercially validated IP portfolio, to one of the most respected names in the sector.

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Versature
Versature is a rapidly growing Canadian VoIP service provider that had been through an unsuccessful sale process with another investment bank. FirePower’s Investment Banking team crafted a story highlighting Versature’s strong growth, brand, people and processes. The most compelling offer came from net2phone, a subsidiary of US public company, Under this new ownership,, Versature is well-positioned to accelerate its growth trajectory.

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Environics
Environics Analytics (“EA”) is a leading North American provider of marketing and analytical services. The company needed financing to support its expansion plans in the US and Canadian markets, and wanted to secure capital from a senior lender that understood EA’s value drivers. FirePower surfaced numerous proposals, then negotiated and improved on the terms and conditions to the benefit of EA.

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As this was the first time we went outside our founders’ circle of family and friends to raise non-dilutive capital, I wanted to make sure I knew all my options. FirePower proposed to do a survey of likely lenders, on a no-name basis; their survey would give me concrete feedback on the likelihood of our raise, while LOT retained the flexibility of anonymity. After positive responses from lenders, the Board decided to formally task FirePower with raising the necessary capital. FirePower proved to be very creative and relentless in their pursuit of the right deal for LOT.
George Achilleos, President of Live Out There