14. PE and the pandemic: Face2Face
Interview with Henrik Lisæth, Explore Equity
Q: How has the coronavirus affected the business and working methods?
A: In six days at the end of March last year, Face2Face was able to pause all activities in all markets. As a result, every promoter-professional safely returned to their homes un-infected. In parallel, company management handled client accounts and kept all clients updated. As a result of paused activities, the company’s turnover dropped significantly in 2020, but it continued to deliver positive EBITDA results.
Q: Was the company in need of fresh capital during 2020?
A: The company had made a recent recapitalisation before the pandemic breakout. Face2Face kept the bank frequently updated and presented step plans for the selected re-launch of activities. In parallel, management exercised tight cost control. This, combined with moderate leverage levels, enabled management to focus on operations and at the same time experience solid support from the bank.”
Q: What does it mean to have an active owner in such a crisis?
A: Face2Face is a compelling case of active ownership with a strong bond between management and partnership owners based on a jointly developed value creation plan. After the pandemic broke out, we have all operated with short decision lines based on a deep, shared understanding of alternatives and effects. The ability to manoeuvre quickly, decisively and be upfront with company clients have been crucial when navigating in a crisis of this magnitude.
Q: Has the crisis led to market opportunities for the company?
A: We have learned that Face2face’s clients have experienced a drop in their sales because of Face2Face’s business pause. Hence the company’s value proposition has proved its worth. While Face2Face’s sales have temporarily dropped, the order book has increased significantly during the last 12 months. Currently, capacity is limited in the Nordic markets because of strict infection control measures. Face2Face looks forward to continuing to grow and operate full scale again as soon as conditions allow.