Romain Payet — When you launch a company like Midnight Trains, communication with the general public is essential. This newsletter of course, but also the media. The written press and radio talked about the launch; with conferences, podcasts, and publications specialising in rail. And then there’s the financial press. Not Les Échos, La Tribune or the Financial Times, but the financial press which covers fundraising for railway startups that have not yet started running trains. The one that only addresses its own world. The big managers, investment funds, companies that offer services to the former, big business angels. More generally, people who may have a significant financial interest in knowing the details of our teaser, the anonymised file that our investment bank sends to the various funds.
It was a media outlet of this type that contacted us at the time. A small British site offered us an interview and the journalist didn’t beat around the bush: he had confidential information about our fundraising and was planning to publish it. He asked us to answer a few questions on this subject, and to comment on what he had in his possession. It was going to enrich the article and enable us to maintain some control over this information. Obviously, we declined. We didn’t know what he really had and we had signed several non-disclosure agreements with our partners. The investment bank also refused this request, for reasons as clear as ours.
Adrien Aumont — Except that the article comes out anyway. It’s short and factual. It contains all the information contained in the documents sent to potential investors. It reveals the expected amount of our fundraising, long-term ambitions, and the routes of our first lines. It’s undeniable - these journalists are well informed. They have, at a minimum, had access to the document. It may be confidential, but it has been circulated. Good specialist journalists have contacts in the companies around which they gravitate. They know the leaders well, meet decision-makers, sometimes have lunch together, or even are friends. And obviously, someone at one of the companies we contacted leaked our teaser information.
This is not necessarily bad news. In fact, it’s a great thing, because, a few days after this publication, our investment bank gets contacted by two infrastructure funds. One French one and another from Northern Europe. The exchanges with the first don’t go very far and the channel of conversation cools down quickly. As for the second, it's a little different. It’s not a behemoth. In fact, it’s a rather small fund, accustomed to investing in its immediate geographical sphere. But it seems really interested in our project, and determined to invest in our trains. So, we move forward with it.
Nicolas Bargelès — The work process that now you know so well begins once again: video meeting, sending over the first elements, a new video meeting, more in-depth presentations of the project, requests for additional elements and so on. Once these discussions are over, it’s clear: they’re still very interested, but have to submit the project to the strategic committee at the end of August. We now know that this kind of answer is not a yes. This infrastructure fund wants to invest in AssetCo, which perfectly matches what we’re looking for. If it invests, the public investment fund we talked about last week could position itself as a follower on the assets. We would have, in order: the majority fund, the public giant and this infrastructure fund as a follower for the OpCo, the operating company.
And it’s the same, in the other direction, for AssetCo. It won’t be enough to buy all our trains, but it’s a good starting line-up. It will then be necessary to borrow from banks, but the fund reassures us on the subject. It’s their job, they know how to do it and will support us on this. Finally, and above all, these different actors communicate with each other, sometimes without us, to organise our financing as best as possible. Our careers and past experiences have taught us to be wary, but an air of trust reigns. Particularly on the side of this new entrant with whom, unofficially, all the signals are green.
It’s good news. All we have to do is convince our strategic committee to allow us to “build the bridge”. That is to say, to buy us a few months to complete this assembly. But with such a round of funding, we have a serious challenge on our hands to convince our shareholders.
