Middle Market: The Importance of Market Preparedness

2024/04/03

Posted by 3Capital Partners

Mid-sized companies, often referred to as the middle market, constitute a specific segment of a country’s economy. Despite not having large capital reserves, they have access to various opportunities for growth and expansion, playing a crucial role in boosting the global economy.

Because of this, this business model also faces unique challenges compared to other market companies, requiring guidance and specific preparation to close good deals.

Middle Market in Brazil

The middle market is the segment that houses mid-sized companies. In Brazil, BNDES states that companies with revenue between BRL 4.8 million and BRL 300 million fall into this category.

Traditionally, the main criterion has been the volume of annual revenues. However, recently, some institutions have started to consider the size of a company based on its assets or number of employees.

For example, IBGE classifies as medium-sized companies those industries with 100 to 499 employees, and the trade and services sectors with 50 to 99 employees. These companies play a crucial role in the Brazilian economy, being responsible for generating a large volume of jobs in the country, especially in basic and lower qualification occupations.

Market Challenges

The challenges faced by medium-sized companies begin with the difficulty posed by the absence of a clear standard for classifying these companies.
Unlike small and large segments, which have significant cohesion among themselves, mid-sized companies face a decrease in their market influence.

Consequently, due to their lesser market influence, these companies have fewer opportunities to obtain capital investments, making access to financing through the capital market difficult, as is the case with large companies.

Therefore, mid-sized companies are dependent on loans and bank financing to enable projects and improvements in production.
In summary, the main difficulties faced by these companies include:

The Importance of Mid-sized Companies’ Preparation

At 3Capital Partners, we understand that companies face a number of challenges that can impact their performance and expansion. Whether facing the need for expansion or the demand to implement strategic changes, we know these situations require agile and effective solutions.

Given these needs, our executives are ready to take the lead and conduct such initiatives efficiently and effectively, based on three pillars:

• Specialized Experience:Our team has extensive experience in various sectors and contexts, ensuring the essential knowledge to master the most demanding challenges.
• Agile Response: We are prepared to act promptly, mobilizing the right resources to meet the immediate demands of your company.
• Proven Results: Our focus is on achieving tangible and measurable results, helping organizations overcome obstacles and achieve their strategic objectives.

If your company is facing challenges that require a specialized and results-oriented approach, contact us. Our experts are available to contribute to the success of your company, even in the most challenging moments.