Cheval Capital Celebrates Expansion and 400th Transaction!
We are excited to announce that Cheval Capital lately celebrated their 400th transaction! Ever since the company started a business in the late 1990’s the leaders have helped businesses in the cloud hosting, and IAAS businesses navigate the though tricky mergers and acquisitions, financings and corporate fund.
The benchmark which is the 400-transaction also marks the 25th transactions that were successfully closed in the last year! Within the last few months, many operations were completed with companies from various countries including in Ireland, Australia, China, New Zealand, Israel, Canada and the United States.
The wide network and e industry expertise has helped in enabling clients to get maximum value in business regardless of their 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.
Below are a few of the of the observations about the hosting, cloud and relevant small business markets.
SMB hosting/cloud business is an industry of mass-market-products: Even though this is not new, it’s interesting how such a massive percentage of those SMB providers from the hosting/cloud area are businesses offering a restricted set of products/services on a mass-market. This focus on a restricted product/service set is terrific for several reasons, but it can also create issues, especially when market expansion slows because of either maturation or competition from substitutes.
What happens when growth rate reduces? 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. To begin with, providers who have been growing slower than the industry with have experienced trouble replacing ordinary attrition, and a few have started to shrink.
Alternatives: Service providers with slow expansion segments appear to be pursuing one or more of several avenues;.
o Utilizing sales and marketing to take customers from competitors.
o Expanding the range of products/services which are either closely related or possess related customer bases.
o Abandoning customer development as a target and running the company to maximize the money flow from these clients (possibly for distribution to owners or for growth into unrelated companies).
o Utilizing M&A to acquire clients or exit the market.
It seems larger suppliers pursue several of those options concurrently. The smaller providers typically tend to concentrate on one or two.
Even though a couple of suppliers that may take away customers from the others and go on growing in these mature sections, it can be hard for many suppliers unless they offer new, high expansion products or solutions. Therefore, such suppliers in such sections may choose to diversify into a broader range of products/services with related client bases or utilize M&A to obtain clients or exit.