To recover after this health, economical and social crisis, Italian SMEs will need liquidity.
These words were stated by Innocenzo Cipolletta, the president of AIFI (Italian Association of Private Equity, Venture Capital and Private Debt).
Many companies have been forced into debt to cope with a substantial decrease in revenues. Now they need new capital to restart and to restore a solid equity situation, but unfortunately the banking system is increasingly reluctant to provide capital.
Therefore, companies need new and flexible financial instruments, capable of supporting the debt incurred and distributing it on a long-term basis.
Alternative Finance is needed!
THE BENEFITS FOR SMES
Alternative financial tools are growing steadily, in 2020 there were 194 minibond (bond loans for SMEs) issues for a total value of € 920 million. The total amount of these operations brought more than € 3 billion into the companies.
Today, more than ever, we must start from these data, from a shared awareness that in order to improve, it is necessary to change. Italian companies must therefore revise their approach and business model, remaining small but moving forward. Having a structured management and a business plan is now the only way to avoid declining and to keep up with Europe.
Diversifying one’s funding sources is essential to avoid being ” tied to” a single supplier (the bank) and to speed up the recovery process by leveraging tools that allow rapid access to credit, without affecting the central risk while increasing the visibility and credibility of the company itself.
BOOSTING INTERNATIONALIZATION
Today, exports to the European Union constitute about 50% of Italy’s goods trade with foreign countries. If Italian enterprises want to continue to expand beyond these borders, however, they must change their mentality, and access the stock market through listing becomes the fundamental driver for accelerating this process.
In fact, the quotation path represents a great opportunity to raise capital that does not have to be repaid in the short term and not only, in fact, this procedure improves the structure of the company, enhances the enterprise’s presence in the internal and international market by taking advantage media campaign and the transparency that the Capital Market requires.
GENERATIONAL TRANSITION
The generational transition is one of the most crucial moments in the life of family businesses. In fact, entrepreneurs’ children do not always have the interest, desire or skills to carry on the company. This can cause great tensions and threaten the stability of the organization, even leading to a possible closing down.
It often happens that there is a lack of planning in the succession process, resulting in the firm finding itself unprepared for this delicate moment. In this situation, alternative finance, and private equity in particular, is a viable option for guaranteeing the future and the growth of the company, as it offers a number of incentives and allows the family to monetize part or all of its assets.
In this context, the role of the advisor, C&G Capital, supports the family as an external party in the identification of the best solution and becomes a key factor for success.
ARE YOU CURIOUS ABOUT WHICH OF THE ALTERNATIVE FINANCE INSTRUMENTS MIGHT BE RIGHT FOR YOU OR HOW PRIVATE EQUITY CAN BECOME THE SOLUTION TO GROWING YOUR BUSINESS?
Contact us for a feasibility analysis of your project!
