By Claire West
Research1 from Investec Specialist Private Bank (‘Investec’) and the Entrepreneurs’ Organization UK (‘EO-UK’) conducted in May 2010 amongst some of Britain’s most successful entrepreneurs on their outlook for the next 12 months reveals that 62% believe that the UK economic climate represents a business opportunity for them. Only one in five (21%) see it as a threat.
Given this, it is not surprising that 72% expect their UK businesses to enjoy double digit revenue growth, with only 4% expecting a decline. Furthermore, one in three (33%) says that it is ‘very likely’ that they will launch a new company or products in the UK between June 2010 and May next year, with a further 37% saying that it is ‘quite likely’ they will do this.
The research from Investec and EO reveals that 57% of the leading entrepreneurs interviewed are looking to secure capital in the UK primarily to fund organic growth, and one in two (50%) needs this to grow their operations through acquisitions.
Ed Cottrell, Investec Specialist Private Bank said: “We’ve seen some deals going for high prices, especially for brands with a high cachet — almost at 2007/2008 levels. Multiples are right on top, despite debt levels in these deals remaining at low levels.
We’re finding that people are prepared to put debt into deals, though the way they are measuring risk is different to two years ago and multiples and amounts remain low.
“People with equity have an appetite to invest, particularly in interesting and unusual opportunities. At Investec, we can offer different sources of debt options for equity investors, such as asset based lending and mezzanine finance when traditional debt fails to deliver. This has certainly become more popular.”
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