Do PIKs Mark the Peak of the Credit Cycle?
DWM Consulting Services LLC
by David Munves, CFA
4y ago
Connoisseurs of past credit catastrophes know that market peaks are typically characterized by especially risky deals, transactions that, with the benefit of hindsight, led rueful investors to clutch their brows and ask “what was I thinking?”  The recent sale of several toggle PIK (payment in kind) issues in the US high yield market, aggressive structures that give issuers the option to substitute additional debt for interest payments, has led me to wonder if we’ve arrived at just this turning point in the current cycle, particularly given the issuers’ unproductive use of the money rais ..read more
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Pandemic Accelerates Digital Transformations, Creating Opportunities for Vendors of New B2B Technology Solutions
DWM Consulting Services LLC
by David Munves, CFA
4y ago
Crises always bring opportunities, and the Covid-19 pandemic, despite its terrible human and economic costs, is no exception to this.  According to a recent study from IBM’s Institute of Business Value (IBV), the pandemic has led firms worldwide to significantly accelerate their rates of digital transformation, creating opportunities for nimble and innovative vendors of B2B technology solutions. The study also notes that company leaders are prioritizing cost management and enterprise agility over product development and entering new markets.  As I discuss later, it’s uncertain if th ..read more
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B2B Sales Topics: Turning Free Trials into Signed Contracts
DWM Consulting Services LLC
by David Munves, CFA
4y ago
If you ask B2B sales professionals what customer response they hate to hear most, “I’m not interested” would be the clear winner.  But in my experience, “I need a free trial” is a strong contender for second place.  The concept of “free” is bad enough for a sales organization.  Product trails also involve administrative headaches, the need to spend time on training and follow-up meetings, and worries about losing control of intellectual property.  And despite everything, prospects often don’t use the trial period to do what they’re supposed to do, namely to actually try ou ..read more
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Forget about Stocks: When it Comes to the Economy, the Corporate Bond Market is What Matters
DWM Consulting Services LLC
by David Munves, CFA
4y ago
Over the past 20 years companies and financial institutions have borrowed $23 trillion (yes, that’s trillion with a “t”) from the corporate bond market, underlining its crucial role in the American economy.  The money flows the other way in the stock market: over a comparable period, companies paid out around $10 trillion (again, with a “t”) to investors in the form of equity buybacks and dividend payments.  This far outstripped the amount of capital investors provided by purchasing newly issued shares.  Moreover, the trend is accelerating, with the level of buybacks and divid ..read more
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Using Strategic Content to Grow Sales of B2B Financial Products: Improving Contract Closure Rates
DWM Consulting Services LLC
by David Munves, CFA
4y ago
In a previous post on improving sales pipeline efficiency for vendors of complex B2B financial products, I discussed how to use strategic content to get raw prospects to commit to lead qualification meetings or phone calls.  This post covers the next stage of the sales pipeline, namely the contract proposal, and the employment of content to increase closure rates.  There are two steps to this, one that takes place before the proposal is sent, and one afterwards.  I will discuss them in order. Time spent in preparation is never wasted Once a prospect has made it through the ..read more
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The Confidence Game: Covid, Consumers, and the Outlook for the Corporate Bond Market
DWM Consulting Services LLC
by David Munves, CFA
4y ago
“The circulation of confidence is better than the circulation of money.”                                                                                                                                                 James Madison &n ..read more
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Junk, Real Junk, and the Default Leverage Effect
DWM Consulting Services LLC
by David Munves, CFA
4y ago
After a spate of downgrades in the leveraged loan market, more than a third of the sector is rated B- or below — a record level.  Despite this, after falling by 21% on the news of Covid-19 outbreak the S&P/LSTA Leveraged Loan Index has now regained almost all of its losses.  The story is the same in the high yield market, where credit spreads have retraced much of their earlier increase. The rallies are in line with the broad recovery of stock and bond prices, and reflect the benefits of the Fed and government assistance programs and low interest rates, as well as the belief amo ..read more
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Using Strategic Content to Grow Sales of B2B Financial Products: Qualifying Leads
DWM Consulting Services LLC
by David Munves, CFA
4y ago
In marketing complex financial products I’ve found that the biggest challenge at the lead qualification stage (the second one in the sales pipeline schema) is getting prospects to engage with a product.  Without this, they won’t devote the time and bandwidth to understanding the product and how it can help them.  And absent this engagement, there’s almost no way to get them through the qualification process.   Lead qualification: a crucial step in the sales pipeline In sales-speak, to “qualify” a lead is to determine if an entity is a good prospect to buy the vendor’s product ..read more
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FOMO: A Powerful Motivator for Fund Managers in a Time of Rising Markets
DWM Consulting Services LLC
by David Munves, CFA
4y ago
Expectations of an economic rebound, government support programs, and low interest rates have all been cited as reasons for the corporate bond market’s strong performance.  But when it comes to active fund managers, Fear Of Missing Out on the rally that kicked off in March should also be on the list.  Institutional investors held record levels of cash in April, just as the rally was gaining momentum.  As I discuss below, large cash balances are poison in a rising market.  Over the past couple of months I think FOMO has led many mangers to shift their cash into bonds, driv ..read more
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Using Strategic Content to Grow Sales of B2B Financial Products: Identifying Leads
DWM Consulting Services LLC
by David Munves, CFA
4y ago
In this, the second post on the use of strategic content to boost B2B sales, I focus on a common challenge all vendors face at the outset of the sales process, namely the need to identify unqualified leads from a much larger group of raw prospects – the initial step in the sales pipeline schema shown below.  It’s a volume game: since typically only 10% to 15% of identified leads end up as closed contracts, getting a good number of such folks into the pipeline is a prerequisite to generating the desired number of dollars at the end of it.  So increasing the yield from such efforts c ..read more
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