Galp, Core Capital urge broader funding for Portuguese firms

Portuguese companies need access to a wider range of funding sources if they are to scale up, Galp co-CEO Maria João Carioca and Core Capital senior partner Nuno Fernandes Thomaz said at ECO’s Fábrica 2030 conference in Porto, highlighting a key constraint on business growth in Portugal.

Carioca said companies’ risk profile changes as they grow and management teams need to understand that shift if they want to secure funding. “Not all financing is the same”, she said, arguing that companies seeking a step change in size cannot rely only on the funding structures that supported them in earlier stages and must be prepared to approach different debt and equity investors.

Thomaz said Portugal needs more private equity, arguing that banks tend to finance predictable activities but are less suited to backing some of the investments needed for scale. He challenged the Financial Stabilisation Fund of the Social Security system, known in Portugal as the pension buffer fund, to allocate 1% of its assets to Portuguese companies, which he said would amount to €480 million.

He added that private equity represented just 0.12% of Portugal’s GDP last year, or €370 million, and said increasing company size is the main lever to address the country’s economic weaknesses. Thomaz said Portugal should have at least 25 groups with revenue above €1 billion by 2030, adding that capital should come with management support and stronger governance to help companies integrate acquisitions and expand sustainably.

Originally published at Eco.pt