What makes certain deals attractive to investors? We spoke with James McCullough and Raj Bhatia, general partners of Renwick Capital Management, a New York City-based investment fund.

Inc.: How do you evaluate a possible bridge investment?

Bhatia: The quality of the underwriting or investment-banking firm raising capital for a private company is key. If we can rely on a bank's selection process and its commitment to carry out an initial public offering, that helps convince us.

Inc.: Does it make a difference whether a company is committed to going public or is uncertain?

McCullough: Absolutely. Bridge loans are usually structured so that investors make money at the IPO stage. They expect the return of principal and an additional payment, usually of stock. So we must know when, roughly, to expect the IPO.

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