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FAQ - EB Advisory FAQ - EB Advisory

Frequently Asked Questions

What is Asset Dynamics®?
Asset Dynamics® is a tool designed for monitoring direct investments in unlisted companies.
Who is Asset Dynamics® for?
Asset Dynamics® was created for investors in acquisitions of holdings in privately held companies. To a certain extent, it also serves directors who wish to have an outside view on the functioning of their company.
What are the advantages to be drawn from it?
Asset Dynamics® presents an overview to the investor allowing control not only at the financial but at the operational and strategic levels as well. This monitoring allows him to realize his entrepreneurial project. This tool is PRACTICAL (it saves time and means, all while properly monitoring the investment), EFFICIENT (it brings more transparency and allows swift reaction to changes) and FLEXIBLE (it adapts itself to the needs of the investor).
Does Asset Dynamics® make investments profitable?
Asset Dynamics® is not a financial service. It protects the value of the investment and insures against losses by identifying difficulties as they arise within the company, thus providing time to react and ensure that the company is on a growing trend.
Why would a HNWI – assisted by wealth managers and advisors – need Asset Dynamics®?
High Net Worth Individuals, their wealth managers and advisors, as well as the managers of family offices and trustees, don’t always have the tools to efficiently monitor this particular kind of investment. Often they are monopolized by other tasks and generally direct investments represent only a small percentage of the portfolio. The time dedicated is limited and after the initial investment attention wanes.
Why call for Asset Dynamics® if we are already on the Board?
Participation on the Board of Directors doesn’t assure you the required information for monitoring the investment. Asset Dynamics® goes beyond the financial status, focusing on the value creation mechanisms.
Concretely how does Asset Dynamics® unfold within a company?
Asset Dynamics® starts on the ground, within the company to understand its processes and strategies as well as to gather information for effective monitoring of the investment. Also, regular contact with the management is indispensable to the monitoring and reporting activities. This relationship is not intrusive but rather based on dialogue and constructive exchange. Communication between the shareholders and the management is equally strengthened.
How are the value creation (or destruction) mechanisms indentified?
A precise diagnosis identifies these mechanisms. By establishing a link between the five major constituents for value creation (offer, market, operations, book assets, competencies) and the global directory of main corporate processes, Asset Dynamics® can quickly and accurately identify these mechanisms and the way they perform.
Can Asset Dynamics® hurt the management?
Asset Dynamics® has no vocation to replace the management of a company. The aspired relationship is direct and constructive respectful of each parties competence. This approach is generally welcomed by management who benefit from this “outside” perspective.
What is the efficiency guaranty on Asset Dynamics®?
Asset Dynamics® vocation is to monitor, not to make investments profitable, there is therefore no guarantee on that level. However, as a tool created to protect value, it makes sure that the company is on track, acts as an alarm system when difficulties arise or when the company evolves in a way that increases the risk of the investment.
At which moment of the investment does Asset Dynamics® intervene?
The flexibility of Asset Dynamics® offers the possibility to intervene at any time of the investment life cycle; however, setting up the monitoring mechanisms early on maximizes the efficiency. Asset Dynamics® has a long term vocation therefore long term monitoring increases its efficiency.
Does the investor keep all his decision-making power?
Asset Dynamics® doesn’t replace the investor who keeps his decision-making power. This tool is designed to make investments more transparent thus enabling the investor to be better informed when making decisions.
Do all the direct investments need this tool? Is the implementation the same for all investments?
Asset Dynamics® operates on various investment sizes. Theoretically there is no minimal amount to invest or minimal percentage of shares to hold. Any person or institution who invests directly in a private company could potentially require and use these services. The means deployed within the framework of Asset Dynamics® are based on a global directory of the main corporate processes and on databases of the best practices of corporate management. These are common to any kind of direct investment but, nevertheless it remains very flexible.
What are the costs of these services?
Costs are defined according to the kind of investment and specific needs of the investor. They can be considered as moderate management fees and rarely exceed 1% of the amount invested.