Investments in demand: medium-sized companies on the stock market
Investors value three things in particular about listed companies: strong, entrepreneurial management, a long-term strategic plan and, of course, convincing figures. Characteristics that we find again and again with our many medium-sized customers. Where else are there so many strategically thinking, firmly rooted in the business and industry-experienced company leaders with a stable smell? The economic success of small and medium-sized enterprises is undisputed. Tangible targets from the manufacturing SME sector are therefore in demand on the capital market. Our team at BankM is in a continuous exchange of ideas with investors from all over Europe and overseas — including institutional investors, insurance companies, KAGs, large private investors — and they are not interested in risk-free 30% returns, but in long-term stable, comprehensible, real investments — precisely the business models of the “hidden champions”. The capital market is ready to provide medium-sized companies from Germany, from Europe with equity capital in sufficient volume and at economic conditions.
In principle, in any case! Because a good growth story comes from hard facts and comprehensible, realistic forecasts. And the medium-sized companies are certainly not lacking in hard facts: a convincing international market position, innovative yet proven technology and precisely timed production processes. It is precisely these ingredients that account for the remarkable long-term successes of German SMEs, which often flourish in obscurity. And these are precisely the ingredients that make a stock market story a bestseller. Of course, an IPO comes with some requirements that require some preparation. But this is not witchcraft and especially companies that are already prepared for professional financial and reporting tools through cooperation with a PE investor will not have much trouble with the formalities at the stock exchange. If further impulses are added, then the basis for a successful IPO is optimally prepared.
Of course, that is what we would like to see, and the development in recent weeks and months at least indicates an upward trend. But for this quietly babbling brook to become a stable stream, additional impulses are needed. For example, we support our medium-sized customers in tapping into China, the world’s most attractive growth market, and in participating there in disproportionate and sustainable growth. The best way to achieve this is through active partnerships or mergers, as numerous examples — above all VW — impressively demonstrate. Such a strategy also convinces investors. Our China desk continuously identifies and analyzes attractive medium-sized companies in China — family-run companies, mostly one generation “old”, excellently equipped with EC and with returns beyond the 20% mark. These companies are ideal partners for German SMEs and together they are perfect stock market candidates!