Gap Between Moroccan Companies and Investment Funds Hinders Funding and Growth Opportunities
Less than 8% of Moroccan companies achieve a turnover between 50 and 175 million dirhams, which is typically the minimum threshold that attracts the interest of capital investment funds.
A recent study by the Moroccan Association of Private Equity Investors, titled “Private Equity, the New Transformative Path to 2030,” revealed that over 90% of the national economic fabric consists of small and unstructured enterprises. This demographic weakens their chances of benefiting from the funding these funds provide, despite having the resources and willingness to invest.
The study attributes this disconnect to a number of structural barriers that prevent the establishment of solid relationships between companies and investment funds. Key issues include poor governance, the absence of institutional decision-making mechanisms within companies, difficulties in auditing financial accounts, ambiguity in ownership structure and equity distribution, and a lack of a clear strategic vision for capital investment and growth.
Fatima Zahra Bouzoubâ, an investment expert, highlighted this paradox in a post on LinkedIn, stating that while funding is available from the funds and a desire for growth exists among companies, the significant gap lies in the scarcity of businesses prepared to receive investments due to a lack of transparency, organization, and strategic clarity.
The study calls for the consideration of creating a new mechanism for pre-configuration of companies aimed at guiding them through the structuring process and elevating them to a professional level that can attract private capital. This mechanism is proposed to include support in improving corporate governance, preparing accounts according to auditing standards, clarifying shareholder structures, and building a strategic roadmap aligned with investment fund aspirations.
The report concludes by asserting that establishing this “structural bridge” could represent a decisive turning point, capable of expanding the base of small and medium-sized enterprises eligible for private investment and subsequently contributing to enhancing the dynamics of the national economy and supporting the transition to a more productive and sustainable developmental model.
Private equity investment, known as “Private Equity,” is a strategic financing tool that involves buying stakes in non-listed companies and assisting them through their growth phases, in exchange for profits upon exiting the investment. It plays a crucial role in enhancing the competitiveness of firms and accelerating their transformation.
