Entrepreneurial boutique investment bankers in the lower middle markets face the challenge of a fragmented space that hinders their ability to source and execute on deals on behalf of their clients. The dearth of actionable information and lack of sophisticated platforms available to them make these financial industry entrepreneurs default to playing on a field in a “David-vs.-Goliath'' dynamic, in which established banks’ connections and networks take most of the precious market share available.
The challenge is to unify the “David” part of the scenario, enabling boutique bankers to find their ideal partners and network with other dealmakers who share their vision and goals. In this fraught era of inflation, high interest rates and uncertain dealmaking opportunities, finding the right connection at the right time is the key to success.
Private capital markets poised for transition and selectivity in 2023
After a tumultuous 2022, the private capital market sector looks to begin stabilizing in 2023, which is expected to be a year of transition. Inflation in the U.S. appears to have peaked in June last year and employment levels stand strong, reflecting the Federal Reserve finessing a ‘soft landing’ for the economy.
However, volatility overall will likely persist in 2023 as capital remains expensive and scarce, and the recent failures of Silvergate Bank, Silicon Valley Bank, and Signature Banks have inserted a huge, blinking question mark for capital raising for investment banking firms for the rest of this year. Hence, more than ever, selectivity in asset selection and robust due diligence in M&A transactions will be of utmost importance. Volatility creates uncertainty, reflected in the decline of private company valuations, which are expected to fall 10%-15% from peak 2022 levels. This could turn public equity and bond portfolio investors that saw negative returns in 2022, back to the private markets.
Engage with the world’s fastest-growing investment banking network
Finalis Marketplace ™ is a platform where bankers can come together to syndicate their deals and find potential partners for business development. The platform is not limited to deal syndication; it also provides opportunities for bankers to discuss industry trends, share ideas, and generate leads.
Finalis’ Head of Capital Markets, Donald Sung, states “We're trying to create a more multi-dimensional marketplace where dealmakers can interact based on their specific needs. For example, a fund may want to raise capital, while a private equity firm may want to sell one of its portfolio companies.” Finalis’ platform strategy creates an environment where bankers can interact, collaborate and engage in conversations that can lead to profitable deal engagements.
One of the main reasons people join larger banks is the economies of scale, and this is precisely what the Finalis Marketplace™ seeks to replicate. By pooling resources in such a platform, bankers in it can execute transactions faster and more efficiently, leaving the lead generation and business development aspects intact, enabling them to generate business based on their relationships.
Finalis’ Founder and CEO Federico Baradello, says “Finalis empowers dealmakers to win more mandates and close more deals. The Marketplace will become the go-to platform for all mid- to small-sized investment banks, businesses and global funds to promote, distribute and find opportunities in the private markets. We look forward to growing and enhancing the platform for bankers and our clients to capture more value and get the exposure they deserve.”
The platform's matchmaking feature connects bankers focused on specific industry segments or geographical locations to discuss opportunities and effectively perform syndication before they get the mandate. The approach is proactive; they nudge bankers to work together in certain types of transactions based on data and interaction. This approach ensures that bankers with different specialties and strengths can work well together and provides a faster and more efficient way to find and close deals.
How can Finalis help you?
Investment bankers can leverage the Finalis Marketplace™ to connect with other dealers and facilitate transactions. With the platform, dealmakers have access to a network of other professionals in the investment banking industry, expanding their reach and increasing their chances of finding the right counterpart for their deals. The Marketplace provides a centralized location for dealmakers to share information and collaborate with other participants, improving their chances for successful engagements. It offers features such as deal tracking and document management, which streamlines the dealmaking process and reduces the risk of errors or miscommunication.
Eager to learn more? Book a call with our capital markets team and discover how you can expand the reach of your network.