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European entrepreneur

Invest alongside entrepreneurs

Why European entrepreneurs?

Companies run by families and entrepreneurs are the backbone of the European economy and an incubator for innovative business models. Entrepreneurs tend to run their businesses prudently. They keep debt levels low and reinvest profits. They are flexible enough to capitalize on new trends and to innovate. They make decisions focused on growing their companies consistently and sustainably. 

European family businesses in numbers

40% to 50% of all jobs of European private employment

60% of total businesses

17 million family businesses in the EU

100 million jobs in the private sector

Source: europeanfamilybusinesses.eu, as of March 2022

An entrepreneur’s commitment to a company ties their reputation to the success of the business. Entrepreneurs therefore tend to be more attentive to satisfying the interests of customers, employees, and business partners. Over time, they build up trust as a distinctive, invaluable asset. And trust is the key to the success of their brands, products, and services.

As a result, family-owned companies as a group tend to outperform broader equity markets. 

Watch the video to learn what makes European entrepreneur-run companies an attractive investment opportunity

Why now?

Companies managed by families and entrepreneurs possess characteristics that foster long-term value creation. Committed ownership, high profit margins, and long-term-oriented investment decisions are among the key drivers of their strong corporate performance. 

Some of the world’s oldest established family-run companies are European. They have repeatedly demonstrated a remarkable ability to withstand the fierce social, economic, and political crises that have shaped the continent. The combination of innovative growth potential and resistance to crisis adds up to an attractive mix for equity investors.

The Credit Suisse (Lux) European Entrepreneur Equity Fund invests in publicly traded European companies in which a family or an entrepreneur holds a substantial percentage of the voting rights. In addition to applying exclusions as defined by the Credit Suisse Sustainable Investment Framework, the fund incorporates material ESG1 considerations into its investment process in order to make better-informed and more sustainable investment decisions. Special attention is also paid to active ownership criteria, including board independence, management composition, and other corporate governance aspects.

1 ESG stands for environmental (E), social (S), and governance (G). More information is available at credit-suisse.com/am/esg. For further information about our Sustainable Investing Policy, please visit credit-suisse.com/esg.
Information about the product’s investment objectives, risks, charges, and expenses, as well as more complete information about the product, is provided in the prospectus (or relevant offering document), which should be read carefully before investing.

Family businesses as a percentage of all companies included in the MSCI EMU index

Family businesses as a percentage of all companies included in the MSCI EMU Index

Source: europeanfamilybusinesses.eu, as of March 2022

Market commentary

Family-owned companies are the key driver of the economy. For investors with a long-term investment horizon, they can provide attractive investment opportunities.

Risks

  • Market risk: The performance of the product may be affected by general economic and market conditions, which may affect the level and volatility of the prices of financial instruments and cannot be guaranteed. Investors in the fund may lose part or all of the invested capital.
  • Liquidity risk: The fund’s investments may be prone to limited liquidity because a family/entrepreneurial anchor investor limits the free float for other investors. Assets may not necessarily be sold at limited cost in an adequately short time frame. The fund will endeavor to mitigate this risk.
  • Corporate governance risks on single names: A dominant shareholder in the form of an entrepreneur or family might not always act in the interests of a minority shareholder.
  • Political and legal risks: Investments are exposed to changes to rules and standards applied by specific countries and the European Union. These may include restrictions on currency convertibility, taxes or controls on transactions, limitations on property rights, and other legal risks.

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Source: Credit Suisse, unless otherwise specified.
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