The European Commission and the European Investment Fund (EIF) are launching a venture capital fund programme named VentureEU. The aim? To stimulate investment in innovative young companies and scale-ups throughout Europe.
One thing is clear...
Europe is teeming with innovative ideas, but sometimes misses the boat to transform this potential into actual success, in particular because of a lack of investment. The United States have been able to profit from this failing, as a country with much higher levels of venture capital: 156 billion on average compared with "only" 56 million in Europe. In 2016, venture capitalists injected close to EUR 6.5 billion in the EU, in comparison with EUR 39.4 billion in the United States.
The consequence? Flight of the unicorns
Innovative start-ups with great potential for growth – so-called "unicorns" when they are valued over one billion dollars – do not find sufficient financial resources in Europe and so leave for other shores. So it's not by chance that "only" 26 of these unicorns called Europe their home at the end of 2017, while the United States could boast 109 and China 59. The challenge for Europe is to encourage these companies with their great potential to remain and grow in Europe.
Doubling European venture capital
In concrete terms, VentureEU groups six funds that will take on shares in other smaller funds in order to cover projects in at least four European countries each, and in sectors such as information and communication technology, digital technology, life sciences, medical technology, energy efficiency and resource use. For this pan-European programme, the EU is providing a stake of EUR 410 million, which should serve as leverage to raise an additional EUR 2.1 billion of public and private investment. The total aim is close to EUR 6.5 billion, which would help to boost young European companies and double the amount of venture capital currently available in Europe.
The aim: 1,500 companies
VentureEU demonstrates the EU's desire to offer European projects new sources of financing. The objective is clear: to create the conditions to spawn more companies that are capable of going global. According to the estimates of experts from the European Commission, the resources made available should provide support for almost 1,500 start-ups and scale-ups.
Optimise your working capital with factoring
How can you keep your working capital healthy while incorporating the requisite financial flexibility? Factoring helps you to finance your cash requirements in a proper, timely and suitable way.
Securing liquidity is the key to financing your working capital requirements and keeping your business running smoothly at all times. That's exactly what factoring offers.It is a structural solution for optimising working capital. In the video below (in Dutch) in less than half an hour you will gain a clear picture of what factoring has to offer.
If you prefer to watch the video in French, click here.
Factoring: a tailored structural solution
In exchange for transferring your invoices to an external factoring company, you can count on fast, flexible financing, monitor the collection of your invoices, and protect yourself against potential bankruptcy among your customers. Each factoring solution is tailored to fit the needs of your business. This includes companies operating at international level. In Belgium, one in six companies currently outsource their invoices to an external factoring company. The same trend is evident in other European countries.
Scale-up concludes mega contract in the midst of the coronavirus crisis
The Antwerp-based scale-up IPEE transforms ordinary toilets into innovative products. BNP Paribas Fortis is more than just the financial partner. IPEE have already come into contact with the right people via the bank’s network several times.
“The traditional urinal has no brain. The infrared eye simply detects that someone is standing in front of the urinal. The result? A lot of wasted water and misery”, says Bart Geraets, who founded IPEE in 2012 together with Jan Schoeters.
The scale-up devised new measuring technology that makes it possible to detect through the ceramic of a urinal when someone is urinating or when the urinal is blocked. With this innovative technology, the scale-up designed urinals that use half as much water and toilets that can be operated without touching them.
“IPEE is an atypical scale-up that innovates in a sector where little has changed in the past few decades”, says Conchita Vercauteren, relationship manager at the BNP Paribas Fortis Innovation Hub.
Jan Schoeters: “At first we mainly focused on durability. But we soon felt that with non-residential applications, the potential water saving is subordinate to the operational aspect. We had to be able to offer added value for each stakeholder in the purchasing process.”
We opted for sleek designs to appeal to architects and end users. The simple installation attracts fitters and maintenance people see the advantages of the sleek design - that is easy to clean - and toilets that do not overflow.
Until 2015, Schoeters and Geraets, along with Victor Claes, an expert in measuring methods and originator of the IPEE technology, put their energy into product development and market research. The financing came mainly from money that they collected in their network of friends, fools and family.
They had to go elsewhere to obtain the funds for production and marketing. Geraets: “We had a product, but it wasn’t ready to sell. To take that step, we needed investors.”
Looking for new investors was a challenge. Schoeters: “We aren’t software developers and we don’t work in a sexy sector. So we miss out with a large target group of investors.”
The young scale-up attracted the attention of Ronald Kerckhaert, who had sold his successful company, Sax Sanitair, at the end of 2015. “He pushed us to think big, more than we dared ourselves. And he never headed for an exit. His express goal was to put our product on the world market”, says Schoeters.
IPEE has achieved impressive growth since then. The product range was expanded and new sectors were broached: educational institutes, office buildings and hospitals. The technology is now used by Kinepolis, Texaco, Schiphol and Changi Airport (Singapore).
“We very soon turned to Asia, because new technology is embraced more quickly there”, Geraets explains. The IPEE technology is distributed in Singapore - where the scale-up has its own sales office - China, Thailand and Vietnam, among other places. About half the turnover comes from abroad, although the coronavirus crisis will leave its mark this year.
“My biggest headache is achieving healthy growth”, says Bart Geraets. One advantage for IPEE is that in coronavirus times, hygiene stands high on the agenda. The scale-up's touchless toilet facilities meet that demand.
At the same time, the shortage of water and the need to use water sparingly is very topical. Geraets: “We notice that in these strange times we are gaining an even bigger foothold. In the midst of the coronavirus crisis we concluded a contract with the world’s biggest manufacture of toilet facilities. Now it’s a matter of further professionalising our business, the personnel policy and the marketing.”
The company’s main bank is an important partner here. Schoeters: “It is more than just a financial organisation. We have already come into contact with the right people via the bank’s network several times. Our bank feels more like a supporter that is also putting its weight behind our story.”
Export plans? Make sure you talk to our experts first
To prepare your international adventure properly, ask yourself the right questions and talk to people who have done it all before: partners, customers, fellow exporters and experts.
BNP Paribas Fortis listens to the questions asked by international entrepreneurs and offers reliable advice. "A lot of exporting companies ask for our help when it's too late", Frank Haak, Head of Sales Global Trade Solutions, says.
Entrepreneurs with little export experience are often unaware of the bigger financial picture. So what do they need to take into account when they set up a budget for their export plans?
Frank Haak: "Budgeting and pricing are affected by a lot of crucial factors: working capital, currency exchange risks and currency interest, prefinancing, profit margins, insurance, import duties and other local taxes, competitor pricing and so on. We always advise customers or prospects to start from a worst-case scenario. Quite a few companies are insufficiently prepared for their first international adventure: they see an opportunity and they grab it, but quite often disappointment and a financial hangover are not far away.
Our experts have years of export experience and the BNP Paribas Group has teams around the world. This means that we can give both general and country-specific tips. Let's say a machine builder wants to design and manufacture a custom-made machine. We recommend including the machine's reuse value in the budget: can this machine still be sold if the foreign customer suddenly no longer wishes to purchase it or if export to that country becomes impossible due to a trade embargo or emergency situation?"
What type of companies can contact BNP Paribas Fortis for advice?
Frank Haak: "All types! Entrepreneurs are often hesitant to ask for advice. Sometimes they are afraid that it will cost them money. However, the right advice can save them a lot of money in the long run. For example, we recommend a letter of credit or documentary credit to anyone exporting goods to a foreign buyer for the first time. This product is combined with a confirmation by BNP Paribas Fortis to offer the exporter the certainty that it will receive payment when it presents the right documents and to assure the buyer that its goods or services will be delivered correctly."
The consequences of not seeking advice: what can an exporter do in case of non-payment without documentary credit?
Frank Haak: "If you are not receiving payment for your invoices, the counterparty's bank can be contacted in the hope that it advances the payment on the customer's behalf. However, we shouldn't be too optimistic in that respect: the chances of resolving the issue without financial losses are very slim. Once you have left your goods with customs, you usually lose all control over them. Hence the importance of good preparation: listen to and follow the advice of your bank and organisations such as Flanders Investment and Trade (FIT). It will protect you against a whole host of export risks."
BNP Paribas Fortis
- is the number one bank for imports (approx. 40% market share) and exports (approx. 25% market share) in Belgium (according to the statistics of the National Bank of Belgium): it offers advice/financing and can help you to discover new export markets through trade development;
- is proud that Belgium is one of the world's 15 largest export regions and is pleased to give exporters a leg up, for example by sponsoring the Flemish initiative ‘Leeuw van de Export’.
Source: Wereldwijs Magazine
#StrongerTogether Lasea decontaminates masks using lasers
Lasea conceives precision laser solutions for high-tech industry. Faced with the coronavirus crisis, the Liège enterprise revived an old project to decontaminate surgical masks – and respond to the shortage of face coverings.
The secret weapon of Lasea is the femtosecond laser. This has an accuracy of 0.2 micron, 200 times smaller than a hair. Lasea’s high-tech equipment is notably used in horology, electronics, medicine and pharmaceuticals. Given the shortage of surgical masks, the Liège enterprise revived an old project for decontaminating, as Lasea CEO Axel Kupisiewicz explains.
“We had tested laser decontamination 20 years ago. At the time, the project had no commercial outlets. With the coronavirus crisis, we proposed using it to decontaminate used surgical masks. That’s how we joined a consortium managed by the University of Liège to develop a decontamination chain. Usually, it takes many months, even years, to carry out the tests and obtain certification. Thanks to the collaboration between the university and the Walloon government, everything was done in a few weeks.”
Reinvention thanks to a crisis
Lasea proposed two decontamination techniques. “For the first, we used a laser device manufactured by Aseptic Technologies from Gembloux, which we adapted to meet local needs,” explains Mr Kupisiewicz. “For the second, we have entered into a partnership with Optec, in Mons. This latter solution makes it possible to treat three or four times as many masks each day.”
Lockdown has also generated a new dynamic within the business. “We launched a brainstorming session to refine the strategy for the coming years. The result: a new organisation after the move to our new building, financed by BNP Paribas Fortis. On the other hand, the widespread use of videoconferencing has created a new dynamic at the heart of the company. Previously, the Belgian team, who were gathered physically on site in Liège, were in a way privileged in meetings with their French, American or Swiss colleagues, present via videoconferencing. Now, everyone is on an equal footing because everyone is behind their screen by themselves. It’s one of the interesting aspects of lockdown that has created a global spirit in an international group.”
A relationship of trust
“BNP Paribas Fortis has been by our side since the beginning, 21 years ago,” recalls Mr Kupisiewicz. “First via the local branch in Sart-Tilman and now, for seven years, via Corporate Banking. Given Lasea’s developments, enlargement to several banks was necessary, but BNP Paribas Fortis remains the primary bank. I place huge importance on personal relationships and a climate of trust. Be it the branch manager or staff at Corporate, our relationship managers know our activities and our products. It’s important: they understand the issues we face and as a result they know our financial needs.”
“Since the beginning of the crisis, the bank has asked if we need support to develop this project of decontaminating masks. We have been able to implement these solutions by redeploying our teams and we have not needed a large injection of capital. We have, on the other hand, welcomed the moratorium on repayment of capital on all our investment credits.”