Chatsworth Securities: Leveraging the USA for Capital, An Exit Strategy or Corporate Expansion in 2023
NEW YORK, NY / ACCESSWIRE / December 19, 2022 / In 2023 it may be an advantageous time for European businesses to consider expansion into the United States. For those European companies without a presence, the American market is a strong first choice for expansion, especially for early-stage and middle-market companies. As the largest economy in the world, the United States offers many potential benefits to companies, not only in terms of sales, networking, and capital but also for higher valuations and exits. Most of the top 50 French start-ups accepted U.S. capital over the past few years and saw their valuations rise significantly. Furthermore, public data confirms that more than half of French exits represented those companies that had a US investor. And, due to its size and global dominance, success in the US market often translates to success in other markets.
Since arriving in Europe over a year ago, Chatsworth Securities LLC has advised large and small European companies regarding the various challenges they face. Among these challenges is the difficulty of attracting local capital to grow the business. There just does not seem to be the risk capital and basic financial products or innovation in Europe compared to the US. For instance, as a share of GDP venture capital investments are ten times higher in the US than in Europe. As a result of these factors, European companies, especially those in the technology sector, are much more likely to be acquired by American firms than the other way around. Medium-term debt instruments are one product that is a significant gap in the market, forcing local entities to use very expensive factoring services costing companies upwards of 30% cost on their income statements. Chatsworth believes it is evident that having an American-focused strategy is key to many potential benefits, especially achieving an exit at a higher valuation.
Heading into 2023 European businesses face multiple challenges from economic conditions including inflation, energy, and interest rates, meaning investors interested in Europe will want to keep an eye on recession risk, the ECB, and equity valuations. At the same time, U.S. financial institutions that provide equity and debt capital and strategic acquirers are ready to speak with European businesses that are either seeking to expand into the U.S. or to be acquired by an American group. Yet, the number one reason these transactions do not happen more often is simply that European companies are not exposed to potential opportunities to raise capital or sell.
Any company interested in expanding into the U.S., attracting U.S. capital, or being acquired by a U.S. company has several options:
Learn more about technology, the economy, and current events at ” The Exit Strategy ”, a podcast co-hosted by Chatsworth Securities bankers Ralph DiFiore, Marcus Magarian, and Swatick Majumdar.
About Chatsworth Securities LLC
Chatsworth Securities LLC, based in Greenwich, CT, is an investment banking firm that has been providing financial advisory services to corporations and entrepreneurs since 1996. Chatsworth advises on both domestic and international M&A transactions, digital transformation, and capital raises for large and small companies and alternative investment funds. Chatsworth has deep investment banking experience in the asset management industry, FinTech, MarTech, B2B SaaS, real estate, green energy, and transition energy industries. Chatsworth has participated as an underwriter in over six hundred public offerings and has raised over $5 billion for traditional and alternative money managers and their funds.
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SOURCE: Chatsworth Securities LLC
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