ThreeD Capital Completes Private Placement Financing: A Strategic Move

Company	Ticker Symbol	Industry	Country	Market Cap (M)	Enterprise Value (M)
ThreeD Capital Inc.	IDK	Venture Capital	Canada	6.49	6.78

Date	Event
Jan 17, 2025	ThreeD Capital Completes Private Placement Financing

Financing Details
ThreeD Capital Inc. has completed a private placement financing, issuing a total of 13,040,000 units at $0.15 per unit, raising $1,956,000 in gross proceeds.
Each unit consists of one common share and one common share purchase warrant, with each whole warrant entitling the holder to acquire one common share at an exercise price of $0.22 per common share for a period of 36 months.
No commission or finders’ fees were paid as part of the Private Placement.
All securities issued and issuable in connection with the Private Placement will be subject to a four-month and one-day hold period expiring on May 18, 2025.

Insider Participation
Management and directors of ThreeD Capital Inc. (collectively the "Insiders") purchased a total of 4,200,000 Units in the Private Placement.
Insiders’ participation in the Private Placement constitutes a “related party transaction” pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”).
The Company is relying on the exemption from the valuation and minority shareholder approval requirements under MI 61-101, as the fair market value of the Insiders’ participation in the Private Placement does not exceed 25% of the market capitalization of the Company.

ThreeD Capital Inc.
ThreeD Capital Inc. is a venture capital firm specializing in seed/startup, early venture, and growth capital opportunistic investments.
The firm seeks to invest in industrials, health care, information technology; software, biotechnology; renewable technology, AI/Machine learning, blockchain, nanotechnology, electric vehicles, internet of things, electronic sports, junior resources with an emphasis on the precious-metal and battery-metal sectors; artificial intelligence with a focus on disruptive data science technologies, machine learning, and other emerging technologies.
The Company's investment strategy is to invest in multiple private and public companies across a variety of sectors globally, seeking to invest in early stage, promising companies where it may be the lead investor and can additionally provide investees with advisory services and access to the Company’s ecosystem.

Strategic Rationale
ThreeD Capital's decision to increase its private placement financing can be attributed to several strategic reasons:
1. Raising additional capital: By increasing the private placement financing, ThreeD Capital was able to raise more capital, which can be used to fund its investments in companies in the junior resources and disruptive technologies sectors. The additional funds will enable the Company to pursue more investment opportunities and potentially increase its exposure to promising early-stage companies.
2. Attracting investors: The increased private placement financing may have been designed to attract more investors, both institutional and retail, who are interested in the Company's investment strategy. By offering Units at a price of $0.15 per Unit, ThreeD Capital may have made the investment more appealing to potential investors.
3. Diversifying its portfolio: ThreeD Capital's investment strategy is to invest in multiple private and public companies across various sectors globally. By increasing its private placement financing, the Company can diversify its portfolio by allocating funds to different industries and geographies, reducing the risk associated with a single investment.
4. Supporting early-stage companies: As a venture capital firm, ThreeD Capital seeks to invest in early-stage, promising companies where it may be the lead investor. By raising additional capital through the private placement financing, the Company can provide more support to these early-stage companies, helping them grow and develop their businesses.

Potential Implications of the Four-Month Hold Period
The four-month and one-day hold period for the securities issued and issuable in connection with the Private Placement may have potential implications on the company's share price and liquidity:
1. Limited liquidity: During the hold period, investors who purchased Units in the Private Placement will not be able to sell their shares, which could impact the supply and demand dynamics of the stock. This reduced liquidity might lead to increased volatility in the stock price, as there will be fewer shares available for trading.
2. Misalignment between share price and intrinsic value: If the company's fundamentals or market conditions change during the hold period, the shares may become more or less attractive to investors. However, since the investors who purchased Units in the Private Placement cannot sell their shares, they will not be able to react to these changes by buying or selling the stock. This could potentially lead to a misalignment between the share price and the company's intrinsic value.
3. Challenges in raising future capital: If the company needs to raise more funds in the future, it may face challenges due to the reduced liquidity and potential price volatility caused by the hold period. This could make it more difficult for the company to attract new investors or complete future financing rounds.

Conclusion
ThreeD Capital Inc.'s completion of the private placement financing is a strategic move that aligns with the Company's investment strategy and supports its growth objectives. By raising additional capital, attracting investors, diversifying its portfolio, and supporting early-stage companies, ThreeD Capital is well-positioned to continue its success in the venture capital sector.