Private middle-market (MM) companies present a unique sort of opportunity for savvy investors. They offer stability, agility, and substantial growth potential for those who know what to look for.
Although it’s tempting to go after the “big fish” investment opportunities, MMs represent a different and relatively untapped market segment with over 215,000 companies. In other words, there’s plenty of opportunity to be found.
Quadrillion Capital specializes in middle-market investment because of the advantages these companies offer over other businesses:
● Established in the market: Middle market companies have steady customer bases and a solid foundation to build from.
● Responsive to growth efforts: Where larger companies may be slow to change, Middle Market businesses still retain the agility of smaller enterprises.
● Addressable challenges: Middle Market companies are unique in that their business challenges are often easily actionable, but they lack the tools or know-how to address them.
This is an (admittedly broad) overview of their benefits from an investment perspective, but these advantages don’t mean that middle market companies have it easy. In fact, when we consider research on middle-market digital transformations, the data tells a different story:
● Only 23% are overwhelmingly successful or exceeding expectations
● 62% are moderately successful or have achieved some desired outcomes
● 15% of middle-market companies fail outright at digital transformation
So, what’s the disconnect here? If middle market companies are ideal investment opportunities, why are so many coming up short at maturing their business strategies?
While most companies are struggling post-pandemic, middle market companies are uniquely positioned to move forward – provided they have support to address their challenges. Most commonly, we’ve seen middle market companies struggle to implement operational improvements, profit expansion capabilities, and digital enablement tools.
Though common, these solutions are easier to address than many business owners think. All it takes is the input of a team who has a time-tested process for transforming companies and generating returns for those who invest. At Quadrillion Capital, we take a multi-step and formal approach to value creation, based on several key tenets:
● Business model and strategy assessment
● Benchmarking and competitor analysis
● Understanding and optimizing Go-to-Market strategies
● Operating cost structure (OPEX) analysis
● Working capital profiling
● Process and automation possibilities
● And more
It may seem like a lot to cover, but this value creation framework is only one part of our shoulder-to-shoulder approach.
We’ve developed a full suite of strategies that provide insights for formulating strategies and change management programs with incentives that improve cash flow. Taken together, these strategies improve enterprise value for middle-market companies and help investors get the best possible ROI.
Middle market companies represent incredible untapped potential for growth. The catch is that these companies need the right tools and strategies to tap into this potential and start generating results. That’s where we come in.
Quadrillion Capital’s teams have deep experience in management consulting, technology implementation, and public/private investments. Our breadth of experience gives us the insight we need to leverage middle-market companies’ strengths and accelerate their development for the benefit of the business and our clients alike.
Interested in learning more about the value of middle market companies and how Quadrillion Capital’s proprietary approach leverages these opportunities? Clickhere to download our whitepaper, “The Trillion Dollar Opportunity: How to Benefit From Investing in Private Middle-Market Companies” and get an in-depth look at our process.