The private capital market allows companies to raise capital without going through the lengthy and expensive process of preparing a prospectus. A prospectus is an exhaustive summary of a company and its offering that is reviewed and approved by security regulators. A prospectus is what enables the securities issued under it to trade in the public markets through an exchange (e.g. TSX, CSE, NASDAQ, NYSE, or NEO).

The alternative to a prospectus is to raise capital through prospectus exemptions in the private capital market. Capital raised through these exemptions is typically facilitated through an exempt market dealer, such as FrontFundr.

These exemptions allow early-stage and growth companies to expand their business without undergoing the expense and time required to conduct a public offering. Very often, many companies forgo placing their shares on a public exchange and remain private, using available exemptions through a dealer like FrontFundr to access capital from retail, eligible or accredited investors.