"It's amazing how many company owners fail to consider the private-placement market," says Tom Kershaw, managing editor of Private Placement Letter, a Manhattan weekly newsletter. If you'd like to find a financial adviser who can handle a private placement well, Kershaw offers a blueprint:

· Talk to as many potential players as possible. Ideally, those would include several different investment bankers, merchant bankers, and traditional bankers. "The way to get the best deal is to foster competition. If you talk just to your 'relationship' banker, you'll never know what your prospects were."

· Look for top qualifications on both sides of the private-placement equation. The first requirement is an ability to structure deals. "You want someone who can demonstrate a comprehensive sense of your financing options: which types of private-placement markets are strongest now and where you'll find the cheapest source of money." The second requirement is a proven ability to sell your deal. However, small companies might not always be able to attract investment advisers who can structure deals and sell well. Kershaw's suggestion: "Consider splitting your deal between two companies, each with its own expertise."

· Choose a firm with a relevant track record. The worst way to hire a private-placement adviser is to gratefully settle for any firm willing to do business with you. Be aggressive, says Kershaw: "Look for someone that has successfully worked with companies of your size and on financing deals that match your goals. It's also worthwhile to ask for a list of institutional investors to which they sell." And you should consult your trade association to see if any investment bankers specialize in your industry.

* * *