How to profit from freshly funded small-cap stars

Companies might make the decision to list their shares on a stock exchange for a number of reasons. Whether it be an exit opportunity for existing shareholders, to raise the profile of the business amongst its customers, or to set a value for the stock, there are many benefits of making the move from being a private business to being a public one.

But by far the main reason given by companies for going public is to raise money for expansion. After all, one of the primary functions of a stock exchange is to bring together companies which are looking for capital with investors who can provide the funds.


There haven’t been many growth exchanges in the world which have been better at raising funds for small businesses than AIM. Since being formed in 1995 the junior market has seen its constituents raise a total of £101.58 billion (as at end May 2017) to spend on expanding their operations – whether all those funds have been spent productively is a different matter!

While fundraising activities are well down on the heady days of 2006/7, as the chart below shows, AIM is still an important fundraising destination for small cap companies. Last year saw a total of £4.77 billion raised on the market, with AIM fighting off competition from alternative lenders such as peer-to-peer and crowdfunding platforms.

Here follows three AIM companies which have recently raised a substantial amount of funds to boost their operations….

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