To persuade investors to invest in France, French fund managers must act as ambassadors

SVP_4544-Eddie-Misrahi-APAX-2016-04-18-680x411The art of persuasion is in itself an engaging exercise. But convincing others to invest in France is currently a real challenge. Yet it is not for lack of arguments.

France is suffering from a negative image

The international media often portray France in a negative light, playing up our 35-hour workweeks, high labour costs, confiscatory taxation, inability to carry out structural reforms, complex dismissal processes and never-ending strikes. Consequently, pension funds, investors and insurers across the world see investments in French companies as far riskier than elsewhere, such as in northern Europe. In addition to the clichés purveyed by the media, fund allocation has shifted significantly over the past 20 years from a balanced geographical distribution of investments to a selection favouring yield and promising economic and political environments. Southern Europe and France have suffered greatly from this.

Yet it is a land of opportunity

France has an abundance of high-performing companies, guaranteeing investors ROI and an attractive yield. It has a wealth of potential, measured by its talented entrepreneurs, highly developed infrastructure, engineers snapped up by Silicon Valley, fast-growing SMEs and entrepreneurial spirit. For over 25 years, French companies have been opening their capital to funds, having understood their utility and value-added. This mechanism is now a fundamental component of entrepreneurial practices, with close to 2,000 French companies opening their capital each year.

And more open than its European neighbours

Contrary to popular belief, France is far more open than its European neighbours. For example, Germany is still very closed to funds. Its family enterprises in particular favour a self-investment strategy and don’t have the same timeframe as private equity. Furthermore, since the 2008 economic crisis, significant capital has been invested in northern Europe, with more investors than ever trying to place their capital, given the scarcity of target companies, their high prices and their low profitability. France is in second place on the private equity market behind the UK: its market is more active than Germany’s or Scandinavia’s combined!

French fund managers have a role to play 

In the absence of local funds prepared to invest large amounts, French fund managers must promote the excellence of French innovation and our proactive, risk-taking entrepreneurs to investors worldwide. Similar to politicians, who are trying – even more actively so since the Brexit vote – to persuade French entrepreneurs to come back to France, we must be ambassadors for France abroad. This is the message that we at Apax Partners have endeavoured to communicate to our investors. And our efforts are beginning to pay off, since out of the €1 billion raised for our ninth fund, 51% has come from abroad.

https://www.lesechos.fr/idees-debats/cercle/cercle-167854-convaincre-dinvestir-en-france-cest-etre-ambassadeur-de-la-france-a-letranger-2074332.php

Eddie Misrahi Chief Executive Officer Contact informations

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