Transcript EIF Presentation Template

Graham Cope
Head of Region,
Northern Europe
Baltic Sea Strategy
Working Meeting
European Investment Fund
Europe’s Leading Developer of Risk Financing for
Entrepreneurship & Innovation
This presentation was prepared by EIF. The information included in this presentation is based on figures available for October 2010
Any estimates and projections contained herein involve significant elements of subjective judgment and analysis, which may or may not be correct.
EIF’s Core Business is Financial Engineering
 EIF is the EU’s specialist institution in Financial
Engineering Instruments (FEIs)
 EIF manages portfolio of over EUR 16bn of
commitments via 500+ Financial Intermediaries
 Equity Instruments: Over EUR 4.5bn through 300 Funds
 Debt Instruments: Over EUR 11.5bn through 200+ Banks
 EIF manages multiple mandates from EU, EIB,
Member States & Regions to create FEI portfolios
 EIF works closely with EIB on many of these aspects
to deliver additional added value
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Baltic Sea Region is a core
market for EIF
 Over EUR 500m invested into
over 60 equity funds across the
region in last few years
 Pioneering marketplace: some
examples…
 Technology Transfer transactions with Chalmers
Innovation Seed Fund and the Karolinksa
Institute in Sweden
 Business Angel Co-investment Fund with Strata in
Lithuania
 EIF strongly supports EUBSSR process but we can
only focus on Priority Area 8: Strategic Project 7.2
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The problem is becoming critical…
Nordic Innovation Center Study, May 2010 ‘Enhancing
cooperation in the Nordic Seed Capital Market’
“the challenges in the early stages include lack of private
financing in the seed stage, difficulties for venture capital funds to
secure new funding for the expansion stage, lack of patience and
focus as well as scattered resources in publicly funded investment
operations.”
Nordic Innovation Center Pre-Study, November 2009
‘Nordic Baltic Investment Fund’
“ Presently, financing for VC funds has become most difficult to
obtain. If action is not taken today, there is a risk of a substantial
setback in the development of the Nordic/Baltic risk capital market.
A well functioning VC market needs, in the long term, to be attractive
to the private sector and particularly to institutional investors
worldwide.”
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Financial Engineering is vital but not simple
 Financial Engineering Instruments are proven to be the
best way to maximise financing of SMEs
 Creates quality investment process, maximises leverage
and improves long term sustainability
 Skill is to combine public with private financing that
creates sustainable critical mass of investment into SMEs
BUT…
 We must understand how Financial Intemediaries think
 And what Private Investors find attractive (or not)
 Without them – it will fail
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Baltic Sea Macro-Regional
Approach is what the
market wants
 Cross-border approach is the only
way forward
 Marketplace wants this solution
 SMEs increasingly operate cross-border
 Financial Intermediaries all operate cross-border
 Insitutional Investment managers need
geographical diversification
 A fragmented sub-regional approach is not the way
forward and we would not recommend it
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Basic Concept – under development
Baltic Sea Region National
contributions
Through agreed percentages
or via ‘opt-in’ basis
EIF contribution
via RCM mandate
Two thirds
One Third
Baltic Sea Innovation Fund
(Possibly up to €375m but may start at lower level eg: €250m)
Business Angel
Co-investment
facility
€50m
Technology
Transfer
Accelerator
€20m
VC Fund of Funds
Window
€180m
High growth potential SME Community across the Baltic Sea Region
Possible involvement of national agencies
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Could be
sector
focussed
eg: Life
Sciences;
Mobile;
Cleantech
Call to Action
 EIF proposes the set up of dedicated Project Team
 Involving Skane Region, MoF SWE, NIC and
National Agencies
 Project team will focus on creating:
 Workable Model & Governance Structures
 Financing Plan with committed contributors
 Launch Timetable & Resourcing plan
 This can work – it is time to make it work
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Contact Details
Graham Cope
Head of Region – Northern Europe
European Investment Fund
96 boulevard Konrad Adenauer
L-2968 Luxembourg
[email protected]
Tel.: (+352) 42 66 88 236
Fax: (+352) 42 66 88 200
www.eif.org
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