The standard structure
A placement agent's fees are agreed clearly and in writing before any work begins, and typically combine two elements:
A work fee. A fee for the work of preparing the raise - positioning, materials, and running the process. It reflects the genuine work involved in taking a mandate to market properly.
A success fee. A fee payable on a completed raise, usually a percentage of the capital raised. Because a large part of the agent's reward is tied to a completed raise, its incentives are aligned with the client's.
Why this alignment matters
The structure is designed so that most of the firm's reward depends on a completed raise. The exact terms are set out transparently in the engagement letter, with no hidden charges - and a credible firm is happy to explain them in full before anything is signed.
The warning signs of fraud
Understanding legitimate fees also makes fraudulent approaches easier to spot. No legitimate firm asks you to pay a fee to release investor funds, or to "guarantee" them - that request is a hallmark of advance-fee fraud. Capital should flow directly between the investor and the company through their own legal and banking arrangements; it never passes through the adviser, and you are never asked to pay to access it.
What to expect from a legitimate firm
Clear fees in writing, agreed before any work begins; no pressure; and a willingness to be verified. Artane Partners charges a work fee and a 2% back-end success fee, both set out in writing, and never asks anyone to pay to release funds. For more on how we operate and how to confirm an approach is genuine, see our verification page and FAQ.
This article is general information on how fees in the market are structured. It is commentary, not investment advice or a recommendation.