Many early-stage companies need consistent access to capital to invest in growing the business, to fund long-term projects, or for R&D. Over the past few decades, alternate modes of funding have evolved to help public companies raise money more expeditiously. One mode of funding is at-the-market (ATM) financing, which emerged in the 1980s with utility companies looking to raise capital on an ongoing basis. From that time on, companies in a broader range of industries, both large cap and small cap, started using it, and when the market dropped in 2008, the number of companies seeking funding through ATMs rose significantly.
Today, many public-company CFOs and CEOs, especially in biotech/life sciences, consider an ATM financing part of their capital-raising arsenal. When deciding on whether or not to put an ATM in place, it is important to understand how an ATM functions, and the pros and cons. Continue Reading