Cheval Celebrates Transactions and Growth!
It was all excitement as the this Cheval Capital celebrated 400th transaction! Since the company entered the business in the late 1990’s Hillary and Frank have assisted companies in cloud hosting, and even IAAS businesses navigate the tricky waters of both mergers and acquisitions, corporate finance and financings.
The 400-transaction benchmark also marked the 25th closed transactions in 2017! The company has completed many transactions in the last few months in many companies including Ireland, Australia, New Zealand, China, Israel, the US and Canada.
The great industry expertise and the extensive network has facilitated in ensuring that clients get maximum value in the aspects of their business regardless of location.
According to their leaders, The company has achieved growth even as providers struggled with organic growth and turned to acquisitions instead. This acquisition requirement has supported prices and led to an active transaction marketplace.
There are several highlights regarding observations about the hosting, cloud and related business markets.
SMB hosting/cloud business is a market of siloed mass-market-products: Though this isn’t new, it’s intriguing to people that such a massive proportion of the SMB providers in the hosting/ cloud space are businesses offering a restricted set of products/services to a mass-market, frequently commoditized basis. This concentration on a limited product/service set is terrific for many reasons, but it can be a source of trouble particularly when market expansion slows.
What occurs when growth slows? As market expansion slow down in many industry segments, the limited product/service set providers in those segments have witnessed their growth slow together with it. Providers who were growing more slowly than the industry face lots of challenges in replacing standard attrition, and a few have begun to shrink.
Options: Service suppliers in such slow expansion segments are pursuing one or more of several paths;.
o Using marketing and sales strategies to take away customers from other providers.
o Expanding into new and related products/services or the ones with related customer bases.
o Abandoning customer growth as a target and focusing on maximizing the money flow from these customers.
o Making use of M&A to acquire customers or exit the business enterprise.
Generally, larger suppliers pursue several of these options concurrently. On the other hand, the small to average -sized providers typically tend to focus on one or a maximum of two.
While some suppliers can take customers away from others and continue growth tough it can be complicated unless one is providing exceptional goods or services. So, such kind of suppliers may opt to diversify into a wider package of Products/services or use M&A to acquire clients or exit.