Conclusion
Corporate finance can mean different things to different people; even the banks divide it into at least three categories: commercial finance, corporate finance, and structured finance. In truth, however, it is about just one thing—how the business is financed. The key is the whole balance sheet approach, looking not only at the optimum mix of short- and longer-term finance, but also at the overall picture: which liability funds which asset, at an optimum balance of cost and risk.
At its best in practice, corporate finance can be a sophisticated science. This does not make it any less applicable to SMEs. While the scale and nature of transactions may often be smaller or simpler, there is no reason why similar principles and practices shouldn’t be applied. Equally, for firms that have the necessary breadth of skills, the fees do not need to be exorbitant either.
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