Growth private equity capital: a year of opportunity for companies seeking funding
Britain’s SMEs are a critical driver of the economy. Now more so than ever. At a time of heightened economic and geopolitical uncertainty, it’s essential that private mid-market companies continue to innovate, grow and create jobs.
First, they must have access to the capital they need. In the wake of the credit crunch, tight bank lending has remained a persistent drawback for business owners as they expand.
But the finance is out there if you know where to look. Recent data from the UK mid-market shows growing investor appetite for mature, high-potential SMEs with proven business models. It would seem that growth private equity is alive and well, and a suitable, alternative choice for your business.
Dry powder fuelling growth
Since the combined shock of Brexit and Trump put a dent in the global alternative investment market in 2016 and early 2017, confidence has returned. At private equity firms, the mass client redemption’s witnessed during 2016 have given way to a swell of fresh inflows.
In the UK, we are seeing this ‘dry powder’ money being put to use, as finance and capital is made available for companies with long-term growth potential and quality management.
The present environment presents a significant opportunity for scale-ups and also partial exit strategies. For many company owners, these options will be preferable to a trade deal as they allow for ongoing involvement.
A window of opportunity
Many PE firms ramped up growth investments in 2018. Specialist growth equity funds, such as Rockpool, are among the key sources of funding and are expecting to invest £100m by the end of the year.
2018 continues to offer a window of opportunity for private business owners seeking capital finance. And with competition for quality investment opportunities intensifying, companies are in a strong position to achieve favourable terms.
But it’s not purely a question of being in the right place at the right time. It’s up to business owners and shareholders to ensure they are in the best possible shape to attract external finance.
This means wooing potential investors or specialist funders with a proven business model and demonstrable corporate growth strategies if one is to stand the best odds at achieving growth private equity capital. It also requires an intelligent approach that will put the company in front of the right investors and finance solutions.
At Avondale, we work with business owners to provide growth private equity capital, management buy out capital, employee ownership trusts and specialist finance, as well as business sales and acquisitions. Contact us on 020 7788 8250 or fill in our contact form to discuss your finance requirements.
We are a member of British Private Equity & Venture Capital Association (BVCA), underlining our commitment to high standards and outstanding levels of service.
