They are often discreet but they nevertheless play a crucial role in structuring the technological ecosystem. In the shadow of the venture capital funds which occupy center stage, investment banks are proving to be instrumental in aligning the interests of investors with those of entrepreneurs. They are thus increasingly called upon in the context of fundraising and mergers and acquisitions, as well as other strategic financial operations (IPOs, partnerships, etc.) for the development of start-ups.
Because if investment banks still act as a link between companies and funds, they now offer more extensive support to entrepreneurs. The faster a company grows, the more value it grows and the greater the return on investment. However, the different layers of investors can complicate matters and result in a complex shareholder structure that can be difficult to bring together.
“A buffer between the demands of buyers or investors and the company”
If the shareholders cannot come to an agreement, then an investment bank becomes decisive in finding a solution. “At these times, some clients need an independent, trusted third party who can get the best deal for everyone.», Explains Guillaume Bonneton, Partner France at GP Bullhound, an investment and advisory bank specializing in technologies. And to add: “We can whistle the end of the game on some things. We are a bit of a buffer between the demands of buyers or investors and the business.»
Listen to our discussion with Guillaume Bonneton to understand how the role of investment banks has evolved in recent years within a booming technological ecosystem:
With more and more deals, and increasingly high amounts, investment banks are seeing their activity increase, all the more so in a period of a global pandemic. And for good reason, the big winners of this crisis, in particular companies specializing in teleworking, remote use, meal delivery, online payment or even gaming, are seeking to extend their domination, while the companies affected by full force by the crisis are thinking of being redeemed in order to last. In both cases, investment banks find themselves on the front line. For fit businesses, it’s a question of raising additional funds to accelerate the pace, while for those in decline, it is a question of finding an honorable way out. Two very different purposes, but which have a common objective: to establish the best valuation to satisfy everyone.
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