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Trust is in DCA’s DNA
Russell Sinclair
Debt and Capital Advisory Leader, Deals
As we have come to the end of another financial year, I’ve been reflecting on the year we’ve just had in our Debt and Capital Advisory (DCA) team and turning my mind to what might lie ahead.
2021 was a record-breaking year for our team. We have raised more than AUD$12 billion in debt facilities in recent years, and much of this was in the past 12 months.
What I’m most proud of, however, is that we’ve achieved this record across so many different sectors. From infrastructure to securitisation, and from large corporate clients to private entrepreneurs, the team has focused on complex matters, and that’s where we’ve made the biggest impact in the market.
Looking ahead, we’re going to sustain our focus on connecting our clients to the right capital markets.
Growth was our mantra in FY21-22
Our DCA team has spent the past 12 months helping businesses to grow. In fact, you could say that growth was our mantra. Almost every client-related conversation I had during this period centred around: How can my client borrow more money to make an acquisition? Or invest in CapEx? Or pay themselves a dividend?
These have been the three dominant areas in deals.
Now, however, that’s all changing, as inflation, and the subsequent interest rate rises, have both come into play.
Debt stress expected to top the agenda going forward
Within the DCA team we know what clients need to get the right funding package in place and my advice to borrowers is to get in early and start a conversation with your bank. If you’re in a precarious borrowing position, the sooner you discuss it with your bank, the better. And if you have an opportunity to lock in your current interest rate, chances are you’ll get a better margin than you will in, say, two years’ time.
So, I expect our business focus will shift in the coming year, from helping businesses to grow, to assisting clients with debt stress with their existing lender group.
In more optimistic news, tech deals – especially Software as a Service (SaaS) deals – are where the biggest opportunities lie right now. With remote working here to stay, and SaaS companies proving incredibly capital-efficient, this asset class is set to enjoy centre stage in the coming months. But be aware: this sector is fast paced and requires bespoke funding solutions, and tailored capital structure platforms, aligned with the latest market insights.
Our DCA DNA
I’m inspired by the lengths our team will go to in order to help our clients. When a complex deal needs funding – whether in the tech space, or in any other industry – our DCA team uses our trusted relationships and industry expertise to uncover exactly what’s needed to fund the deal. By positioning borrowers to lenders in just the right way, we help optimise financial outcomes for the future.
Much of this comes down to experience. Our DCA team has a combined 300+ years’ experience in banking, and so we understand the inherent value (and risks) associated with debt. We’ve seen everything in the banking playbook when it comes to debt, and we have extensive experience right across the debt spectrum.
As for the team itself, we’re a boutique, tight-knit, multidimensional team, who’ll move mountains to improve our clients’ circumstances. We’re relatively small (or, as we prefer to say: nimble) compared to the rest of PwC’s Deals teams. And yet we’ve hired three new team members during the difficult pandemic period.
We’re also an incredibly diverse team. In fact, our local team members originate from five different continents.
Join us: Building a DCA career
The DCA team has only been part of PwC’s Deals practice for about a decade, yet our impact is already long-lasting. Anyone looking to build a career in debt and capital advisory would be wise to take a similarly long-term approach.
It’s all about establishing a firm foundation with broad-based experience in order to succeed. View your career as a pyramid, not a tower, and seek a range of experiences so that you can provide the best possible service to clients. This means accumulating technical knowledge, as well as establishing a mass of professional connections steeped in trust and respect.
Because when it comes to DCA, I think trust is the most valuable currency you can have.
More information
Find out more about our Debt and Capital Advisory services or about a career in deals.
Shaping the future of deals
In a series of eight articles, our Deals leaders reflect on the year that has been and the market outlook ahead, speaking to the value they bring to a deal and what makes their team tick.
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Russell Sinclair
Leader, Debt and Capital Advisory
I'm most passionate about solving for the unknown. Our team has decades of experience, and we know how to solve almost any issue that a borrower has. It's about having the confidence to sit with a client and talk them through what that solution could be.
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