In the short term we may find that inflationary pressures on households and pressure on savings limit the attractiveness of discretionary consumer products and services for investors and acquirers.
However, in the longer term the underlying drivers in the economy such as a massive shift to e- and m-commerce, concerns about ethics and sustainability, the rise of delivery services, a focus on health and wellness, affordability, experiences rather than things, localness and the impact of influencers will generate opportunity and growth for many volume B2C businesses, and these will be of continuing interest to investors, funders and acquirers.
While we may expect appetite for investment or acquisition of casual dining businesses to decline amongst mid-market PE, there may be a compensating focus on experiential businesses where no investment in real estate or leases is required. At the same time Food and Drink businesses which appeal to the health and wellness narrative are likely to do well. The consumer purse will always be an attractive place to focus, albeit we can expect a very selective M&A market during 2023.
The HMT Team has a clear understanding of what acquirers and investors will look for in terms of KPIs and how B2C businesses are likely to be valued in the market. Scale, growth, resilience, business model and margin are all likely to be areas of focus and while there is a definite pay off between pace of growth and profitability.
In the short term, investors are unlikely to back B2C businesses that are not at or very close to profitability unless there are significant mitigations. Our recent credentials include advising businesses in the following sub-sectors
- B2C services
- Food & Drink
It was a pleasure to work with the HMT team, who showed professionalism and attentiveness in securing the sale of the business. The team at HMT provided us with invaluable advice and assistance during the transaction process, utilising their commercial expertise to manage a successful deal. We would not hesitate to recommend HMT to any prospective business sellers.
Shareholder of Norwegian Logs
We engaged HMT to negotiate and deliver a funding profile for our MBO of the company, but also one that provides us with the capacity to deliver upon our immediate growth opportunities. The team at HMT took the time to understand our business to provide invaluable support to ensure we could execute the MBO with the right funding partners whilst ensuring that we can deliver on our roadmap. We would not hesitate in recommending them to anybody seeking a strategic and hands-on adviser.
Operations Director at Wheelwright
We at WaterBear Education, in partnership with Maven Capital, are committed to redefining the model for music education. Innovation, quality and authenticity define the brand and we are delighted with the progress we have made to date. The team spirit between our investment partners, WaterBear and our advisers HMT has been integral to the success of the venture.
Shareholder of Waterbear
HMT provided us with invaluable advice throughout this transaction offering support that regularly went above and beyond the call of duty. Their professionalism, perseverance and insights were instrumental to get the deal done.
Board member of Mottocaddy
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