RESEAR CH + RANKINGS
Breaking
tradition Chasing opportunity through alternative sources of finance
The funding attitudes and practices of family businesses in North America, Europe and Asia-Pacific are changing in the wake of the global financial crisis a decade ago. Daniel Bardsley examines the latest research by Campden Wealth in partnership with KKR and asks what these new trends mean for family business growth
T
he financial crisis that developed a decade ago has had countless effects that continue to reverberate throughout the global business community.
Among these are changes to the ways in which
family businesses finance themselves. Many traditional providers of capital are
restricted in the ways in which they can assist family businesses, leading to an increasing focus on what are typically known as alternative sources of finance. This sector’s growing importance was among the
findings of the latest research report published by Campden Research in partnership with the global investment firm KKR. Family Business: Financing for Growth Report
2017 was based on the responses of dozens of ultra-high net worth individuals across the globe associated with family businesses with average turnover of more than $400 million. The 44-page report canvassed the views of people in North America, Europe and the Asia-Pacific region (APAC).
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The report looked at everything from how family
businesses select financial partners to what types of financing they prefer, as well as what trends are evident in terms of how these preferences are changing. Among the findings was how important “hard”
requirements, such as interest rates, fees and libor floor, are to family businesses when they look for finance. The terms of financing were
cited as important by 88% of respondents, while 86% says the cost of financing was essential. Another hard requirement
highlighted in the report was maintaining family control and continuing to prioritise governance when offering equity, with 85% of respondents noting this was important.
PHOTOGRAPHY: GETTY IMAGES
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