Where next in Private Equity? Pt 4 with Richard Taylor (Santander)
Continuing on our series of articles where our Private Equity connections and Professional Advisors give us their sense of the immediate impact of Covid-19 on future deal flow, considering different market sectors, potential access to finance, and what lasting affects Covid-19 could have on future trends and markets.
Our contributors are Paul Wood, Director Corporate Finance advisory at Grant Thornton, Andrew Webber, Partner and Head of Corporate at TLT, Ned Dorbin Head of South West and Investor at BGF and Richard Taylor, Regional Director South West and South Wales Corporate and Commercial Banking at Santander.
In this final article, Richard Taylor, Regional Director South West and Wales Corporate and Commercial Santander Corporate Banking, has responded:
Do you think that there could be any underlying messages in this ever-changing World and what are the key lessons coming out of this current Pandemic?
The key has been the adaptability shown by management teams and their ability to make swift transformations to their operating business model
Immediate impact of Covid-19 on future deal flow.
Short term deal flow has slowed but expect that to return quickly for certain sectors that have withstood the direct impact from the COV19 crisis. Biggest employer challenges will be how to manage employees in ‘social distancing’ workspaces (easier in some workplace environments than others), changes in underlying consumer behaviours & impact on the supply chain into the business. A key challenge to deals restarting, one that existed pre COV19 but will now likely become more pronounced, will be the ‘value’ that buyers & sellers place on their business.
Considering different market sectors.
Already clear that some businesses & sectors have thrived, and generally tech-led businesses are doing well alongside manufacturing businesses that are either making in demand product or have adapted their offering to make something in immediate demand. Numerous examples of manufacturers pivoting their business model to produce PPE, hand-sanitizer & safety screens. Whilst this may prove just meeting a short-term demand for a product or service the key has been the adaptability shown by management teams and their ability to make swift transformations to their operating business model.
A desire to embrace and build upon our newfound working flexibility
& the collaborative behaviour it typically engenders will potentially prove to be a positive shift for all concerned.
Potential access to finance
The financing schemes put in place & provided across the banking sector have provided support across a complete mix of businesses. While there were some initial teething problems regarding businesses’ eligibility for the various schemes available, banks have been working round the clock to deliver the much-needed funding to SMEs. Many companies are understandably reluctant to take on new or additional debt and, in some situations, equity may prove the better medium/long term option.
Lasting affects Covid-19 could have on future trends and markets. Key changes likely to remain post COV19 are a move to more digital based society. Big companies have radically addressed how their workforce undertake their roles – office bound employees working from home on an unparalleled scale demonstrating the value in previous investment in IT platforms and personnel to allow this to happen.
Productivity has not appeared to suffer in the relatively short period that firms have had to adapt but too early to see wider scale impact. From a financial performance perspective business in telecommunications, media and technology, Healthcare & certain areas of Manufacturing (like Food & Drink) appear to have materially outperformed.
In response to the question: Do you think that there could be any underlying messages in this ever-changing World and what are the key lessons coming out of this current Pandemic?
We anticipate numerous changes across all aspects of our working and personal lives as we emerge from the COV19 pandemic. All business leaders will need to continue to balance the requirements of their workforce – to feel safe at work, a growing recognition of the importance of personal wellbeing tempered with a feeling of job security – alongside the requirement to provide goods & services that consumers ultimately still want & need.
At a micro & macro level, adaptability has been a key factor for successful performances by employers & employees during COV19 and this has always been a big component of how flourishing entrepreneurs thrive. A desire to embrace and build upon our newfound working flexibility & the collaborative behaviour it typically engenders will potentially prove to be a positive shift for all concerned.’
Thank you to Richard Taylor, Regional Director, Santander Corporate & Commercial Banking, South West & South Wales.
Santander has a team of 20+ professionals looking to support successful, high growth regional businesses thrive both domestically & internationally.
In Conclusion:
We would like to thank Paul, Andrew, Ned and Richard for their insight and commentary in what is an evolving scenario. At Moon, we can certainly sense a paradigm shift in how a business presents itself to both its employees and its external world. We feel this will be considered when assessing a business worth and market share.
In terms of our offering at Moon Exec Search, our strength is that we are always quick to respond and swift to market, and with our many years in search, we can quickly access senior and relevant Exec’s and Non Exec’s for a new Board build. Our offering includes a defined sector sweep and market analysis, identifying talent on a global basis.
So, we see that our Clients and Advisors are already looking at the next emerging sectors, future markets and what hot trends are developing. So here at Moon, we are looking forward to the new investment landscape and are talking to companies who have already built up new capabilities and are learning important lessons to prepare for a buoyant future.
Moon Executive Search provide bespoke solutions for clients, using our extensive expertise and knowledge gained from twenty years of recruiting to find your perfect candidate. If you are looking to appoint a senior leader to your Board, visit Build Your Board to get started, or call us on 01275 371200. We are here to help in these unprecedented times.