The origins of the word “Financier” date back to the early 16th century, with roots of the French term used to refer to those that were “concerned with finances”. The term financier derives from the word ‘finance’ which are found in the French word “fin” that means “end”, which was used to denote the end-payment of a debt or the sense of compensation.
The modern definitions of the word “financier” can take few different variations and often include professions from corporate financiers, investors, lenders, asset managers and even central bankers.
The most commonly used definition of the word financier refers to a person or organization that controls or handles large sums of money and provides money for various types of financing in order to fund large scale investments for the private and public enterprise sectors.
Through the years, the image that people have of financiers has been mainly formed by the view of prominent personalities of investments, financing, and banking; usually ultra-wealthy and with a well-respected track record of successful investments and financings over the decades. Typically these days, a financier is connected with the fields of investments across the whole capital structure of a firm. This can include corporate finance being the main scope for the arrangement of equity or debt financing in companies.
The functions of a well-versed financier involve large-scale capital and asset management, private equity, corporate finance and sometimes even investment banking functions in order to address the needs of various businesses and their capital requirements. From a well-established corporation to a business which is in a growth phase, financiers are called in to contribute their expertise and skill.
Financiers may generate income from various sources, like the return on their investment in the form of capital appreciation and dividends, or make margins on the interest in the case of debt funding. Commission fees are also generated for the capital provided or raised from the financier’s portfolio. Depending on the sophistication of the financier and the deal complexity, the financier has an increased managerial and lead advisory role due to the technical and specific deal requirements. The terms “high-level finance” and “high complexity deal” are almost synonyms to the term financier for those who know the intensity and challenges of the field.
A financier isn’t simply an institution or someone who just handles money, as many dictionaries oversimplify the term. The financier is an important key component which criteria and prerequisites for this field come with a high-level sophistication and seasoned experience.