Interview with RCF Senior Partner Russ Cranswick

Russ Cranswick is from British Columbia in Canada and had an extensive career in mineral exploration before joining RCF. Russ spent most of his early career working as a geologist on exploration projects in remote northern Canada. 

While growing up in a more rural area of southeast BC, as a teenager, I did yard work for a retired geologist who regaled me with old-timer tales and graciously sponsored me to attend university and study geology. He had no children of his own and perhaps saw my education as a gift back to the profession. I studied four straight years of geology and worked each summer for different companies to gain experience in a range of commodities, geological settings and geographies.

I worked in silver, gold and base metals at several different locations in northern BC and then a large reconnaissance program for gold that took me from the far northern Canadian city of Yellowknife to the Arctic Circle.  This area was then all within Canada’s Northwest Territories, but now some of it would be part of Canada’s newest territory, Nunavut. After I graduated, I worked in the Yukon on a gold project and other, mostly northern, exploration programs.

I then worked for Freeport McMoRan Gold Company, which was based in Vancouver and looking at assets across Canada. I rounded out my exploration career at Kennecott for about five years where I was back to northern Canada in base metals and helping acquire Kennecott/Rio Tinto’s initial 7.5 million acre diamond exploration land position during the Canadian diamond rush of the early 1990s.


After 10 years working in the field, Russ was introduced to the concept of a resource analyst role by David Thomas, who is now RCF Managing Director Canada, yet at the time had been a geologist and transitioned into a similar role as an analyst with a brokerage house.

By the time I was 30, I had spent much of the past decade working in the field which then, in Canada, meant you’re pretty much away six or seven months of the year for one to three months at a time, and was ready to be closer to home and family.

During a site visit in the eastern arctic of Canada, I ran into to David Thomas (now RCF Managing Director, Canada), who had been a field geologist and had shifted careers by becoming an analyst with a brokerage house. I wasn’t really aware that type of job progression was available and the idea of being able to use your mineral exploration skills and also a lot of financial analysis, yet be at home more of the time, really appealed to me. Within two months of this encounter, I had found a job as a mining analyst in Vancouver for a brokerage house.

It was around the same time that I first met Ryan Bennett on a field visit (it could have been the same one that I ran into Dave Thomas on) and he and another industry colleague introduced me to James McClements at a mining conference in the late 1990s.  We talked a bit about joining RCF near its inception, but it wasn’t until several years later, in 1999 when RCF II was being raised, that I joined RCF. The timing made sense as it was a downturn in the mining industry and slow on the junior company equity side, yet RCF was ramping up and actively investing. I contracted for six months, then my wife and I moved to Denver in mid-2000.


Russ has worked with RCF for 15 years now and has been linked to many of the transactions which have taken place during that time and throughout his career has made many industry connections around the world. Russ talks about being close to the work performed by the deal teams and the benefits that RCF brings to its portfolio companies.

‘Canada’, Compliance’ and ‘Trading/Market Research’  are technically my portfolios, but really it is about the transactions. As one of the Senior Partners, I am responsible for overseeing the entire portfolio and the range of investment teams, so I spend a lot of time in particular with our deal teams. I sit in their area and they’re regularly dropping in to talk about the history of a company or management team, and to discuss the process that they might go through for a nuanced transaction. Being able to provide real time input is important and certainly what I like being involved in.

With respect to the transactions, I like the creativity with which we structure deals and the personal connections that many of us have with people after many years spent in the industry.  I think the benefit for portfolio companies having RCF as a partner is multi-fold, given that a lot struggle, particularly these days, to obtain consistent, long term support. It may be that the market loves the company when the market is hot, but as soon as it is not, or the particular commodity is out of favor, they lose a lot of their investors overnight.

We can be comfortable with the investments that we make, partly because we take a lot of time and care to complete due diligence and get comfortable with the company’s assets.  When we invest, it is often a sizable position and, by the illiquid nature of that large position, we’re committed to sticking with the investment and working to help realize the company’s potential. This view is obviously in parallel with the company’s management team’s goals of advancing the asset, so we’re aligned as well as committed.


Over time, Russ has observed several changes in the market and industry dynamics and provides some insight on what he perceives to be the current market situation and how this impacts on RCF as well as work that Russ is doing personally to support the next generation of resources industry professionals.

We’ve certainly seen a lot of the industry players change quite dramatically over time. Funds that may have invested significantly a few years ago don’t exist now, and ones that still exist may have had a high turnover of people. On the other hand, the RCF team has been pretty consistent throughout the past 15 to 20 years, which is certainly one of our strengths.

People know where to find us and they know the types of transactions that we do and I think they’re often quite pleasantly surprised when there’s always another suite of things that we can do that they weren’t aware of or we haven’t done to date; we’ve more or less created something to suit their situation. Preconceived ideas of what we are or what we do can probably slow the process down and management teams often don’t appreciate RCF’s value-add until after the fact.

In the current market, I think there’s a good opportunity in the fact that we’ve consistently been a mining focused private equity firm. It has been nice to see the measured growth – we have grown quite a bit over time, but it’s always been measured. It’s as much about the people as what they can do when we hire and build groups. The people have always been important and still are. We’ve got a good culture and it makes us all want to come to work each day.

In addition, the JP Morgan Center for Commodities is something that the Dean of the University of Colorado Denver business school approached me and a few other industry colleagues about several years ago. Created with the goal of becoming the global leader in commodities research and education, I joined the Center’s advisory council at its inception and it is great to see it growing and gathering some momentum.  Denver is a natural location to foster collaboration between academics and professionals from the agriculture, energy and mining sectors.

Value of Private Equity for TMAC Resources

Toronto-based TMAC Resources is currently developing the Hope Bay Project, a gold development in Canada’s Hope Bay region with planned first production by the end of 2016. In a market that has been otherwise difficult for gold companies, RCF provided over 85% of the last two rounds of private funding and, with RCF contributing one third of the amount raised, the company recently successfully closed its C$135 million initial public offering (IPO) on the Toronto Stock Exchange (TSX).  Priced at C$6.00 per share, the issue established a market value for the company of C$445 million.

RCF has built a strategic partnership with TMAC Resources, since its initial investment in early 2013, which has enabled the company to complete a positive pre-feasibility study to further advance and de-risk its Hope Bay project prior to accessing the public markets and  developing the mine. RCF VI now owns approximately 37.1% of TMAC’s common shares.

RCF Senior Partner Russ Cranswick said that the initial TMAC Resources evaluation completed by RCF revealed a good quality asset with a high value proposition, given its Hope Bay project’s previously known resources, significant existing infrastructure and strong management team.

“The investments which ultimately attract RCF are those where we can see the long term potential for future growth and opportunity. When we invest, it isn’t about making a quick entry and exit, it’s where we see that we can add value through our market environment agnostic financial support plus our mining and risk management expertise over time. Mining Journal has astutely identified that, as a shareholder, RCF has invested in TMAC Resources’ long term strategy from exploration to construction ready and now the company’s IPO / project development funding.”

The company has said that it would use the proceeds raised under the offering to advance the Hope Bay Project to planned first production by the end of 2016, for exploration activities and general corporate purposes.

The Wall Street Journal reported that Canada’s resource-heavy Toronto Stock Exchange hasn’t listed a mining company since December 2012, when Oban Mining Corp. completed a small, C$10 million IPO.

In the May 2015 issue of Mining Journal profiles the value of private equity over time for TMAC Resources. Read the Mining Journal article.

TMAC Resources is now trading under the TSX ticker ‘TMR’.

Investing in Northern Canada’s Nunavut Territory

Resource Capital Funds has had a long held interest in northern Canada and the Nunavut region, having held several successful investments in the area. In particular, some of the attributes that make the region an attractive investment proposition include its highly prospective geology, world class deposits, commodity diversity, shipping in close proximity to some projects and populations near, but not in immediate proximity to projects. It is also a jurisdiction that welcomes and readily facilitates investment in resources.

To date, RCF has invested $265 million, or approximately 10% of the funds that it has invested since inception, in Nunavut to support four key projects – Baffinland Iron Mines Corporation’s Mary River high grade and direct shipping iron ore project on Baffin Island, Comaplex Minerals Corp.’s Meliadine gold project near Rankin Inlet, Cumberland Resources Ltd.’s Meadowbank gold project north of Baker Lake and TMAC/Miramar’s Hope Bay gold project south of Cambridge Bay.  RCF’s substantial investments in each project were provided to advance assets through feasibility, bulk sampling, permitting and/or project financing stages.

Each investment faced its owned challenges from fickle equity markets to challenging joint venture arrangements yet ultimately became examples which demonstrate how RCF’s flexible funding and long term investment approach help to achieve positive outcomes. All of the four projects were later taken over by mid-tier and major companies in $3.5 billion worth of acquisitions.  Fortunately, the Hope Bay project is once again in the hands of a junior company, TMAC Resources, and is fully funded to build the region’s next significant gold mine.

Key achievements which resulted from RCF investments made in Nunavut include less dilutive bridge loans, greater investor confidence, improved communication and, in the instance of the Cumberland Resources and TMAC investments, the private equity advantage for the companies was a cornerstone shareholder when they were financing their mine development.

In each of the four opportunities, RCF was able to see beyond the market valuation of the day to provide long-term and stable funding, which is always important in fluctuating markets and volatile project dynamics. For more information on RCF’s investments in Canada please contact RCF’s office in Toronto.