How did MBO build its own international strategy as a fund manager?
First and foremost, we must clearly define the nature of our business. Private equity is often viewed through the lens of the investor – the one acquiring companies. But the fundamental job of a fund manager is, first and foremost, serving its clients: institutional investors worldwide. These are asset managers and capital allocators who entrust us with a fraction of their assets to outperform in an alternative asset class known as private equity.
Our primary challenge is therefore to attract and retain these clients in a market that has expanded massively. Over the span of a decade (from 2010 to today), the French market grew tenfold. This expansion came with globalized competition: an investor looking for exposure to France now has to choose between a specialist in French small-caps, a US venture capital fund, or an Australian infrastructure fund.
Furthermore, our model has profoundly evolved: we shifted from an “inspired investor” logic, based on personal conviction, to a rigorous portfolio-builder model, offering clients consistent deployment quality and reliable performance construction. That is the major strategic pivot.
From the perspective of international LPs (Limited Partners), we experienced a paradoxical double movement. When MBO was founded in 2002, in a much narrower market, our uniqueness paradoxically attracted top-tier institutional investors. As the market grew and structured itself, that positioning became structurally harder to defend: major US pension funds, which might have allocated €10M to €20M to a small French fund twenty years ago, now favor massive deployments with mega-funds capable of absorbing commitments of €100M to €500M across multiple strategies. The race for scale has profoundly altered the rules of the game in our segment.
How did you support the global development of your portfolio SMEs, and what role did Altios play in that story?
That is exactly where our paths cross. In MBO’s early days, we developed what we called “support offices” – outposts in China, India, and Brazil. At the time, the BRIC markets were the center of attention, and these offices were designed to help our SME CEOs explore those markets. The goal was to cut down the cultural learning curve and offer a structured entry point, preventing our companies from starting from scratch.
The idea made sense from a marketing standpoint, but proved insufficient operationally: we simply lacked the critical mass to feed those offices with genuine expertise and deal volume.
It was against this backdrop that we met Altios, introduced by an SME in our portfolio that had used your services. Altios’s dual offering proved highly valuable: on the one hand, strategic diagnostics – identifying priority zones and tailored market-entry models (distributor, subsidiary, M&A) – and on the other, operational support during execution. These two dimensions are highly complementary and cannot be decoupled.
Together, we supported the progressive professionalization of our SMEs’ global development: moving from direct export to distributors, and from subsidiaries to acquisitions. This trajectory matured considerably over the years, shifting from a CEO handing out business cards at trade shows to highly structured entrepreneurs capable of acquiring companies in Europe or the US.
What is the international success you are most proud of regarding a portfolio SME? And conversely, your biggest regret?
The most iconic example is LMB, a neglected subsidiary of the American group Honeywell, based in Brive (France). In 2013, it was generating €10 million in revenue with €1 million in profit. It was an under-invested company operating in a highly niche market: manufacturing cooling fans for aerospace and defense embedded systems – a sector few understood at the time.
The strategic framework set upon our entry was clear: LMB operated in a global niche market of roughly $150M to $200M, dominated by an American player, Rotron. This dynamic was dictated by the structure of the global defense market itself, where the US accounts for over 50% of spending. The core question was: should we exit this niche to chase higher volumes, or stay and aim for global dominance? The diagnostic was unambiguous: stay in the customized products market, but scale it globally.
We launched two decisive moves alongside the Altios teams.
The first: Creating a subsidiary in Hong Kong to tackle the Asian market – specifically China – at a time when Chinese manufacturers were accelerating their aerospace and defense investments, and French suppliers held a real competitive advantage over US suppliers for sensitive technologies.
The second (and most decisive): Acquiring a US distributor, divesting its non-core assets to secure ITAR compliance (allowing us to sell to the US defense industry), and relocating the CEO to Miami, where he built a local team and drove the business forward.
The result: organic growth taking revenue from €10M to €50M over ten years, and a valuation that soared from €10M to €400M before the company was sold to a US acquirer.
The regret concerns Arcado, the French leader in Morteau sausage and specialty charcuterie, boasting €120M in revenue and €20M in EBITDA. The strategic rationale seemed solid: high-value-added specialty products, deeply rooted in strong regional identity, to be exported to markets with a strong pork-consumption tradition, notably Germany and China.
The initiative failed. Morteau sausage ran into massive local competition, insurmountable barriers to entry in foreign mass retail, and a value proposition that proved difficult to translate internationally. The company nevertheless achieved outstanding performance on its domestic market. The international angle simply wasn’t the driver of that success. Whether this was a flaw in the initial strategic analysis or an execution issue remains an open question.
In your view, what structural shifts will SMEs and mid-caps face in the next ten years to succeed globally?
Before even considering growth opportunities, companies must now think in terms of risk. Global value chains have been under immense strain in recent years. Globalization fundamentally relies on maritime trade – a heavy dependence on roughly ten strategic straits, whose fragility in the face of geopolitical hazards is now blatantly obvious.
We are operating in a low-intensity economic war between China, the US, and Europe. Behind the diplomatic rhetoric lie concrete realities: supply chain bottlenecks, arbitrary rulings in certain countries, and significant legal risks. For companies today, global expansion is measured against very real systemic risks.
China has captured a massive share of intermediate technologies in the energy transition and automotive sectors, leveraging unprecedented economies of scale. In digital tech and artificial intelligence, Europe’s position remains structurally weak. This geoeconomic vice sets the framework within which SMEs and mid-caps must operate.
That being said, artificial intelligence opens up very real prospects: barriers to entry in software development are dropping, and the cost of accessing technology has plummeted. France’s strengths in this area – notably its concentration of world-class technical talent – constitute a massive lever that remains underexploited.
For French SMEs, this dictates three strategic imperatives: securing the supply chain through a rigorous stress-test of every vulnerability in the sourcing model; managing the energy transition, a major challenge in energy-intensive sectors given French energy costs; and finally, designing global expansion strategies that structurally bake in prolonged geopolitical insecurity.
To borrow Taleb’s concept: companies must become anti-fragile. It isn’t about predicting every crisis – that is an illusion – but building an organizational and strategic architecture robust enough to absorb the shocks.
If you had to challenge Altios on its value proposition for the next ten years, what would you advise?
I would recommend two simultaneous moves that may seem contradictory, but are ultimately complementary.
The first is to massively accelerate the digitization of all operational and procedural advisory services: incorporating subsidiaries, market research, regulatory compliance, and local recruitment. Everything related to process execution must be augmented by AI – made faster, cheaper, and more accessible. AI is going to commoditize a significant chunk of traditional consulting; it is better to preempt it than to suffer it.
The second move is to invest heavily in the exact opposite: strategic intelligence, creativity, and the ability to produce what no technological tool can generate. In an economy where AI executes processes more efficiently than humans, value shifts toward strategic thinking, navigating complexity, and spotting non-obvious opportunities. Investing in experts capable of guiding CEOs through that dimension is exactly what AI will never replace.
Ultimately, it comes down to simultaneously digitizing the processes and humanizing the strategy.
What three pieces of advice would you give an SME/mid-cap CEO looking to accelerate global development?
First, take the time to think. Not as an abstract concept, but as a concrete discipline: block out half a day a week to step away from the daily grind, read, and work on your strategy. The most enduring and highly valued companies are those with a clear bearing.
Second, de-risk your value chain. Methodically analyze every single vulnerability in your operational and sourcing model. This isn’t a growth lever; it is a foundational prerequisite. Without that solid bedrock, your global expansion efforts remain exposed to logistical or geopolitical hazards that could wipe them out entirely.
Third, and probably the most decisive: build a human task force. Assemble what you might call an agile strike team – a pool of two, three, or four highly trusted executives or managers who are perfectly aligned with the company’s values and operating model, and whom you can rapidly deploy across your primary theaters of operation.
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