Market Liquidity – Large capital resources available once Fed stops hiking interest rates: We have seen internal surveys done by large wealth advisors which show that cash balances/equivalents are approx. 40% of portfolio allocations which compares with approx. 40% equity allocations and 20% other (including fixed income). This capital is sitting on the sidelines waiting for the Fed to signal rate hikes are over before it will be put to work.
Capital Provider Interest – We have demand for complex Private Credit Opportunities that provide a Capital Provider yield between 12 and 15+%. The demand includes asset backed as well as receivable backed transactions.
Venture Capital – Valuations remain uncertain, but demand exists for “risk reduced” sectors. Most Venture Capital Providers are reserving capital to help existing investments weather the storms but firms with 5 million+ revenues withing certain sectors such as Cybersecurity, Climate Change and Energy Security are seeing interest.
US Economy – Growing consensus from Capital Providers on Q1 Rates/GDP Outlook: As per our Insights from last month where we stated that we were seeing growing consensus for Q1 to be a “soft landing”, the Wall Street Journal is now writing that “Investors Grow More Confident Fed will Pull Off a Soft Landing”1 in Q1 2023.
1 https://www.wsj.com/articles/investors-grow-more-confident-fed-will-pull-off-a-soft-landing-11670704543
Contact Us:
Deer Isle Group
info@deerislegroup.com
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Founded in 2007, Deer Isle is a differentiated investment bank that empowers Capital Participants with the right tools to ensure transparent, smooth, and efficient direct capital markets outreach. Since our founding, we have successfully transacted over $5 billion in capital, through Deer Isle Capital, LLC (our FINRA registered broker/dealer), for companies and funds in a wide variety of security types, sectors, and geographies.
The foundation of our approach is innovative unbundled capital capabilities, expertise, and guidance that are customizable depending upon our client’s requirements.
Our services, available on an “as needed” basis include:
Strategic Capital ConsultingTM (“Deer Isle Bootcamp”) to prepare for a capital or M&A transaction including Strategic Capital PositioningTM, Strategic Capital Modeling, Due Diligence Preparation and Capital Markets Landscaping.
Beacon (“Proprietary Technology”) offers “Direct Issuance/Contact” capabilities, as well as Capital Markets Brand Building, which helps ensure capital markets success today and in the future from a relevant universe of 10,000+ institutional (fiduciary) capital markets organizations/45,000+ institutional capital markets people.
Closing Advisory/Guidance (including “Shepherding”) expertise, through Deer Isle Capital, for structuring, negotiating, and completing a successful capital/M&A transaction.
