Browsing by Issue Date, starting with "2023-05-08"
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- From idea to funding : accelerators as catalysts for equity investments in start-upsPublication . Serrão, Inês; Rajsingh, PeterEarly-stage start-ups are characterized by high levels of uncertainty. Incubators and accelerators aim to guide founders through the development phase and prepare fledgling companies for fundraising. Therefore, selection criteria and program design can have a significant impact on graduating start-ups for acquiring follow-on investments. This dissertation used 14 interviews with VC experts and program managers, and a survey with entrepreneurs with experience in incubator/accelerator programs. Findings revealed that selection criteria for admitting into a program tend to focus on team, market opportunity, and the solution the firm is offering. Team quality was considered the most important factor at early stages, but investors do not solely base decisions on this, despite this factor accounting for up to 80% of program managers' selection criteria. Further findings highlight the subjective nature of the decision-making process in early-stage start-ups. Our results reflect that VC investors prioritize technical skills and founder-market fit as primary investment criteria for early-stage start-ups. Incubator/accelerator programs, despite being sector-agnostic, significantly help with management skills, documentation preparation, and expanding founders' networks. Thus, program managers must address gaps in technical skills while improving industry specialization. The study suggests that accelerators and incubators can affect investor decision-making, depending on their reputations. This accrues from a track record of successful portfolio companies and stringent selection criteria for program entry. Overall, this study suggests that a delta between accelerator selection strategies and investor selection due diligence criteria can impact the success/failure of start-ups in acquiring follow on investment.
- Add-on acquisitions as a strategic tool for LBO value creation : an analysis of return drivers and market dynamicsPublication . Miotto, Edoardo; Shuwaikh, FátimaFollowing a massive wave of leveraged buyouts (LBOs) which took place in the 1980s, the private equity asset class started gaining mediatic resonance both for its uncommonly sharp risk return profile and the meticulous exploitation of structured finance. Due to the increasing maturity of the LBO industry and the consequences of the covid pandemic, LBO firms have been progressively looking at buy and build strategies (BaBs) as a strategic tool to generate value for their limited partners, with the volume of add-on acquisitions increasing at a CAGR of 13,2% in the period 2006-2016. Through thorough research and analysis, this paper shows how PE firms can generate returns and value through BaBs and what are some distinctive features of the market for this peculiar type of transactions. Among its most interesting findings, this paper demonstrates how the increased volume of add-on activity has been driven majorly by mid-market operations and characterized by an increased focus on ICT industries and on the financial services industry. Furthermore, it provides evidence on how large cap platforms appear to be keener towards performing cross-border consolidation processes which, according to existing literature, should deliver the highest IRR. Finally, this paper demonstrates empirically the positive impact of performing add-on acquisitions on multiples expansion even after controlling for financial cycle conditions, which are the element with the largest impact on the multiples expansion achieved by PE firms.
- Mercadona : would the benefits of further internationalizing outweigh its risks?Publication . Pereda, Francisco; Guedes, NunoThis case study analyses the dilemma that Mercadona, the leading retailer in Spain, faces regarding its internationalization strategy. The case starts by going through the company’s history, reviewing its key turning points and evaluating the factors that helped Mercadona achieve the privileged position in the market it now enjoys. Mercadona possesses several attributes that would encourage its management to be brave and optimistic during its strategic decision-making process. Its business model is becoming increasingly popular globally as big supermarkets and hypermarkets gain market share whilst traditional grocery stores seem a thing of the past. The dissertation includes a literature review on topics concerning the internationalization for global retailers and a teaching note with recommendations were made as to what Mercadona’s next steps should be. Although focusing on the Iberian Peninsula, taking into account the challenge Portugal represents, could by no means be considered as a severe misplay, further internationalising into a culturally similar market would be the most beneficial strategic plan.
- Vista Alegre equity valuationPublication . Pais, Vanessa Loureiro; Martins, José Carlos TudelaThe objective of this dissertation isto provide a fair share price for the company of Vista Alegre. The Vista Alegre was founded in 1824 and is the biggest ceramic producer in Portugal being known worldwide by the quality and design of its pieces. To attain the share price two different methodologies are used, the DCF method and the relative valuation, with the last being added as a methodology to verify the coherence of the DCF provided price. Within the DCF, the model used is the FCFF and in the relative valuation is the P/E and EV/EBITDA. At the end of this dissertation, the concluding share price of the company is of 1,34 euros, fully provided by the DCF model. As of 31 of march, the market share price of Vista Alegre is 0,81 euros. Nonetheless, the fair value of the share price is 1,34 euros according to the valuation provided in this dissertation, meaning that, currently, the price is undervalued and is expected that, assuming market efficiency, the market price will converge to the fair price providing a BUY recommendation. Furthermore, the recommendation and share price are compared to a report provided by the Marketscreener, that presents a fair value price of 1,40 euros and a BUY recommendation being aligned with the recommendation provided by this dissertation.
- Business adaptive strategies in crisis : the case of Joshua's Shoarma Grill : a case study of the strategic response to the Covid-19 Crisis from a Portuguese restaurant chainPublication . Guerreiro, José Miguel Hermenegildo; Cardeal, NunoThe COVID-19 crisis pandemic, and its consequent restrictions, forced many companies to reinvent themselves and innovate to keep being active in the Portuguese economy. The following dissertation, presented in the form of a case study, has as subject Joshua Shoarma Grill and focuses on the strategies implemented in response to the challenges faced during the pandemic years. Joshua's Shoarma Grill is a Portuguese restaurant chain that is present in the main shopping centers of the country, which represents two of the most affected sectors by the COVID-19 restrictions. The restaurant sector faced constant rules and restriction changes throughout the pandemic and the shopping centers were almost completely closed during the lockdown months of the crisis. As a consequence, Joshua's Shoarma was forced to reinvent and innovate their brand, which meant making several crucial changes to find new ways to reach their clients and create new channels of revenue for the sake of successfully continuing operating during the crisis. The purpose of this case study is to serve as a pedagogical instrument for the students to explore the application of strategic management concepts, in a real case scenario, on how to successfully keep the company operating during the Covid-19 crisis. The information in the case study was attained through interviews, news and online resources available on their website and social media.
- An analysis of internationalisation strategies adopted by diversified banks : the case of BNP ParibasPublication . Nuutinen, Jonna Linnéa; Parada, PedroThrough globalisation it has become increasingly important for banks to develop effective internationalisation strategies to remain competitive in the global market. Therefore, it is important to look at the drivers behind bank’s internationalisation strategies and their effectiveness. This thesis analyses BNP Paribas’ internationalisation strategy through qualitative methods to provide an understanding on how banks expand to new foreign markets. Primary data was acquired by interviewing senior managers from BNP Paribas and further secondary data was used to validate the findings. The thesis studied differences in strategy between well-diversified banks and traditional retail banks, with the aim to understand the drivers behind BNP Paribas’ success in its internationalisation. Specifically, the study finds that cultural similarity of target markets diminishes when studying more diversified banks, shifts in the home market affect foreign expansion, and building home market capabilities is essential before beginning foreign expansion. These findings have important managerial implications and provide practical insights for banks planning to expand internationally and contribute to the academic research on banks’ internationalisation strategies. By carefully considering their unique strengths and weaknesses when developing their internationalisation strategy banks can achieve greater success in the global market.
- Screening and characterization of the diversity of food microorganisms and their metabolitesPublication . Rocha, João Miguel; Kovacevik, Biljana; Veličkovska, Sanja Kostadinović; Tamame, Mercedes; Teixeira, José AntónioFood is rarely kept in a sterile environment and the composition of microbial associations found in various foodstuffs is widely varied. Microorganisms in food usually originate from the natural microbiota of raw materials and the surrounding environments. Whether a species prevails depends upon its ability to adapt to intrinsic factors associated with foods, such as nutrient content; pH; water activity; oxidation–reduction potential; and antimicrobial properties, with various extrinsic factors playing a role, including temperature, relative humidity, atmosphere, and ambient pressure. Any change to these parameters may cause changes in the present microbial consortia. Therefore, it is important to identify which microbial consortia will thrive in particular foods and conditions. While active, microorganisms undergo many complex mechanisms that affect food quality and safety. Most beneficial food microorganisms belong to lactic acid bacteria and yeasts. Pathogenic and spoilage bacteria are usually Gram-negative, although there are some Gram-positive ones, such as Listeria monocytogenes, Clostridium botulinum, and C. perfringens. Some may merely cause spoilage, while others may be related to foodborne illnesses.
- Business adaptive strategies in crisis : the case of OláPublication . Manuelito, Pedro; Cardeal, NunoThe COVID-19 pandemic and the social distancing measures adopted to contain it had an unprecedented impact on the world, resulting in an extensive and complex range of consequences. Firms were forced to adapt and the effectiveness of such responses constitutes a valuable topic for analysis. The present case study regards Wall´s, more specifically the firm’s activity in Portugal under the name Olá, describing how the health crisis impacted its core business and dissecting the subsequent strategic adjustments. Throughout times, Olá has witnessed brisk alterations in consumption patterns, demand and competition. COVID-19 worked as a catalyst, accelerating those changes and especially contributing to the industry’s digitalization. Ice cream consumption moments moved from out-of-home to in-home, a consequence especially dire to Olá, whose fuel resides essentially in its activity away-from-home. In that sense, the firm was forced to readjust its business, leveraging the increased segments and adapting the deceased ones. This case study, as a pedagogical instrument, aims to apply theoretical concepts into Olá’s real scenario, in order to understand the effectiveness of the managerial decisions behind the mitigation of the negative impacts and the leverage of opportunities.
- Dell Technologies Inc. (DELL) equity valuationPublication . Olaio, Patrícia de Araújo e Sá; Martins, José Carlos TudelaThe goal of this dissertation is to perform the valuation of DELL’s Technologies Inc. shares on the 31 st of January 2024. The company is United States based and part of the index S&P 500 in the New York Stock Exchange market (NYSE). First an analysis of the industry and the economic context the company is in was done, then a thorough analysis of the enterprise as a whole, more specifically in financial terms, in order to conduct the correct valuation. The major method chosen was the Discounted Cash Flow (DCF), that relies on discounting the estimated future cash flows by the Weighted Average Cost of Capital (WACC) allied with the growth rate. The final value calculated was $47,30 in comparison with the value on the 31st of January 2023 of $40,62, which indicates an upside potential of 16,44% of these shares. In an analyst point of view, the recommendation is to Buy for the shares of DELL Technologies Inc. At last, a sensitivity analysis was made as well as a valuation through the Dividend Discount Model to be compared with the previous method.
- Portfolio company value creation : when private equity deploys AIPublication . Mueller, Moritz Maximilian; Rajsingh, PeterThis study concerns the role of artificial intelligence (AI) in private equity (PE portfolio companies) for developing and implementing efficiencies. Triangulating findings from current scholarship, expert interviews, and a consumer survey, our investigation revealed that AI is perceived as a significant disruptor, with the potential to transform PE operations and create value for portfolio companies. The research highlighted several advantages of AI initiatives for PE portfolio companies, including strategic guidance and providing critical resources and management alignment. Furthermore, the survey demonstrated that consumers are receptive to AI applications in PE. However, the paper also identified limitations which could potentially hinder successful adoption of AI in portfolio companies. The efficacy of PE AI initiatives was found to be contingent upon the specific circumstances of each portfolio company, with benefits likely to be minimal or not present for AI-native firms. Thus, while certain challenges persist, our findings underscore the importance of PE funds focusing on developing core AI competencies to harness AI efficiencies across their portfolio companies.