2) Would you suggest them, to follow a geographical expansion, to partner with

investors (joint venture) or private equity funds?

Geographical expansion entails growing by opening new stores in new cities at a

national or international level. It implies a great level of investment (€/ 350 k) by each
new store opening outside of Spain, and to do this they would need external capital.

Private equity fund would be great for quick short-term funding reception, however, we
do not think that the long-term consequences and the significant power exerted over the
management of company is the best outcome considering the values that the brothers
present.

Therefore, a Joint venture would be the best model for geographical expansion. It has
great long-term benefits, and the brothers would be able to retain control over the
company in some years. Also, having access to the local partner’s knowledge sharing
development costs and risks and being politically acceptable are main benefits of this
model, as well as access to technological and management know-how.