Entrepreneurial Finance for Student Entrepreneurs in Europe_HKIST_REE090910

8/8/2019 Entrepreneurial Finance for Student Entrepreneurs in Europe_HKIST_REE090910

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Entrepreneurial Finance for Student

Entrepreneurs in EuropeHeleen Kist



Today‟s workshop

I‟d like to tell you about Europe‟s ambition

Entrepreneurial support in Europe

The new(ish) focus on student entrepreneurs

CommonalitiesInterestingvariations

I‟d like us to discuss

Whether student entrepreneurs merit specialattention

Considerations in developing the optimal supportpackage for student entrepreneurs



Europe

„Old‟ Europe

(Possible) accession states

Non EU



Europe‟s ambition

The Lisbon Agenda 2000 – 2010

Its aim was to make the EU "the most competitive and dynamic knowledge-basedeconomy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion", by 2010

Strong focus on knowledge transfer

ERDF (Structural funds) applied to Regions

EC funding applied Europe-wide

The new European Strategy 2010 – 2020Its aims to turn the EU into “a smart, sustainable and inclusive economy

delivering high levels of employment, productivity and social cohesion” by 2020

Still strong focus on knowledge and innovation

Stronger focus on employment

ERDF (Structural funds) applied mostly to Regions in newaccession states



The big trends

The 80‟s & 90‟s

Technology parks by universities to attract inward investment Provided incubation opportunities for spin-outs

Grants and favourable tax regimes began

Late 90‟s - 00‟s

Cluster strategies, physical or virtual

Investment in technology transfer offices

Still a lot of incubation

More network creation, advice and grants

Access to Finance to fill the funding gap

Now

Last chance at publicly funded Access to Finance in „Old‟ Europe,still trying to stimulate the private sector. JEREMIE.

Still a lot of focus on High Tech opportunities

But a recognition of opportunity in the „lost generation‟

Private sectorengaging

gradually, andsometimestaking over



Case studies: Tech transfer gone public

Imperial Innovations (London, UK)

Tech transfer department for Imperial College founded 1986- one of the first in Europe

Incubation facilities

2002 sold stake in its portfolio to private investors

Listed on AIM in 2006

Third party incubation contracts with Carbon Trust and WRAP

Karolinska Development (Solna, Sweden)

Investment fund dedicated to Life Sciences in Nordiccountries based at Karolinska Institutet

Partnership with KIAB Incubator: right of first refusal!

Rights issues to raise funds, with pension funds and privateasset managers as shareholders





Ranking of support infrastructure

Ahead of the curve

UK

Nordic countries

Netherlands

A concerted effort

France

Germany

Belgium

Switzerland

Lagging behind

Italy

Spain

Greece

Portugal



Entrepreneurial support landscape

Type of support

Competitions

•They‟re everywhere!

• Smallest prizes <€500

• Biggest European prize €100,000*

• Biggest Global prize > $250,000**

• Great exposure

• Adds credibility

• Corporate partners could become

supporters or customers, e.g.

SHELL LiveWire

Advice & mentoring Grants Incubation Real Money

Networks & competitions

Networks

• Universities and Business

Schools have entrepreneurship

clubs

• Industry cluster networks

• Random entrepreneurship

networks

* www.seedcorncompetition.com **DFJ/Cisco




Type of support

• It‟s everywhere!

• Usually publicly funded and run: is considered the minimum

• Databases of mentors or consultants

• Signposting

Grants IncubationNetworks & competitions Real Money

Advice & mentoring

Finds you a „Godfather‟





Type of support

• Very common

• National or Regional

• Range from <€1000 to £250,000 (Scottish Enterprise‟s Proof of Concept)

• Usually to help fund:

• training

• (marketing) consultancy

• investor readiness

• R&D

• EU Framework Programme to support R&D and collaboration

Advice & mentoring Incubation Real MoneyGrants

EXIST in Germany gives grantsthat give entrepreneurs a salary,

funds for materials and evencontributes to childcare cost!



Case study: Piggy backing on grants

SMART match funding from Braveheart Ventures

SMART Awards are grants from Scottish Government for R&D

start-ups in feasibility stage They offer up to £50,000 for up to 75% of project cost.

Remaining 25% must be provided privately – own funds,investment, revenue, …

Braveheart Ventures, angel syndicate (originally) and listed

investment company active in very early stage technology sector Braveheart set up a SMART Equity Scheme which provided the

private match funding required in exchange for equity

Benefited from dealflow

Benefited from due diligence

Benefited from public sector leverage





Type of support

• Most commonly associated with universities, although some private

sector facilities exist

• Range tremendously in size and professionalism

• Generally provide free or low cost

• Office and lab facilities

• Business support

Advice & mentoring Grants Real MoneyIncubation

• Geneva, Switzerland

• Non profit foundation, launched 2010• Scientific Advisory Board, and VC on Board• Co-working facilities, seminars attracting many

student entrepreneurs – very organic





Type of support

Advice & mentoring Grants Incubation Real Money

Public investment

• Venture Capital and

Loan funds either fullypublic or with private

contribution

(subordination of public)

•Often focused on High

Tech only

• Micro-loan funds for

small service oriented

businesses

Angels and private VCs

• Invest within a region

for convenience• Clustered around

centres of Excellence

e.g. Oxford & Cambridge

Banks

• Not easy to get credit

•

Government loanguarantee schemes to

facilitate

New JEREMIE funds, funded by ERDFand European Investment Bank for next

5 years in many regions in Europe



Case study: Latching onto Universities

Listed technology investor in UK

Partners with universities to provide proof of concept and seedfunding for high tech companies

IP Group provides a cash payment to the university in exchangefor either a percentage ownership in any IP coming out of department/university (e.g. Chemistry at Oxford) and the rightof first refusal

IP Group commits to a certain amount of funding to having dealscouts on the ground to stimulate company creation and select

investments



Most commonly found in „Old‟ Europe

Networks &

competitions Real Money

Advice &

mentoring

Grants &

incubation

Type of support

Type of entrepreneur/business

Nature of source

AnyoneDis -

advantaged

Academics,

researchersStudents

EC or ERDF PrivateNational orRegional Gvt

Public & private

Focus of source

European UniversityNational Regional



What you wanted me to talk about

Networks &

competitions Real Money

Advice &

mentoring

Grants &

incubation

Type of support


Nature of source

AnyoneDis -

advantaged

Academics,

researchersStudents

EC or ERDF PrivateNational orRegional Gvt

Public & private

Focus of source

European UniversityNational Regional



Case study: Student focused equity

Venture capital fund focused on student entrepreneurs inGroningen, the Netherlands

Joint venture between local 2 universities and a privatefoundation aimed at supporting employment in the region

Runs business plan competitions with €750 prize money

Investment of up to €100,000

Investments not necessarily high tech

Farganic - FILT label of fairtrade clothing

Ryfkogel – high end hair styling device andproducts



New(ish) focus on students

Recognition of „lost generation‟ problem at policy level: high

unemployment throughout Europe

Increasing number of successful role models

Cultural shift: away from „professions‟ as best career choice 83% of Dutch students want to start their own business… but only 3% do*

45% of French students want to start their own business **

Only 12% of Spanish students want to start their own business***

Increasing ease with which one can design and develop aproduct, service, App, etc at low cost

Increasing ease with which one can market to customers

20 is the new 40?

*** http://www.eleconomista.es/blogs/emprendedores/?p=977

* Poll by Jong Ondernemen, May 2009

N o t c o m p a r a b l e

d a t a b u t

t r e n d f e e l s r i g h t



Case study: Stimulating students

Movement for French student entrepreneurs

Promote student entrepreneurship

Support entrepreneurs in their journey through tutoring and business

plan competition

Provide information through the online portal

Set up by

French Government

State Owned agency for promoting business creation

OSEO is a public French consultancy and investor that supportsinnovation, provides bank guarantees for innovative projectsand helps find funding for innovative projects.



And students are doing it for themselves

Student run incubator in Helsinki, Finland Started early 2010 by students and entrepreneurs from

Aalto university‟s Entrepreneurship Society

Seed funded by the university

The Garage „s 700sq meter free working space for anyone

throughout the Baltic area

Run BootCamp and Summer of Startups training 4 timesa year

The highest potential teams from our Bootcamps becomeGarage Startups.

These teams receive a mentoring relationship with thecoaches, office space for 6 months and 5,000 euros.

The Garage also sends the Garage Startups to eitherSilicon Valley, Isreal or China to broaden theirbusiness contacts.

Suggestion to attend the “Student Run VC Funds” discussion on REE agenda



Discussion



Do students need more/specialist help?

Survey among business support an representative organisations forentrepreneurs in 2000. The study covers all 15 countries of theEuropean Union and six countries in Central and Eastern Europe.

Source: http://ec.europa.eu/enterprise/policies/sme/files/craft/craft-studies/documents/executivesummary_en.pdf



Do students need more/specialist help?

Survey among business support an representative organisations forentrepreneurs in 2000. The study covers all 15 countries of theEuropean Union and six countries in Central and Eastern Europe.

Source: http://ec.europa.eu/enterprise/policies/sme/files/craft/craft-studies/documents/executivesummary_en.pdf



What is “the right” package for students?

Networks &

competitions

Advice &

mentoring Grants

Type of support


Nature of source

AnyoneAcademics,

researchersStudents

EC or ERDFNational or

Regional GvtPubic & private

Focus on place

European National Regional

Incubation Real Money

Dis -

advantaged

Private

University



Companies mentioned duringthe workshop



Companies mentioned in workshop

Ephicas, the Netherlands

Started in 2008 by PhD student at the Faculty of Aerospace

Engineering at the TU Delft

Ephicas SideWing attached to trucks deliver an average fuelsaving of 5% to 10%

Supported by Yes! Delft incubator

Immediate traction with prospective customers: TNT

As a result, some innovation loan from Rabobank

Watch video onwww.ephicas.eu/

about-us/

Henesis, Italy www.henesis.eu

2007 Spin-off of Scuola Superiore Sant'Anna

Design and development of multiscale artificial perception systems

Small local grants for training and consultancy

Investment by family member

Early partnership with Toyota

Participant in Framework 7 programme

http://www.ephicas.eu/about-us/








Speaker bio



Heleen Kist

Heleen Kist is an independent strategy consultant, based in Edinburgh, specialising in

technology ventures, access to finance and the knowledge economy.

She advises private companies, large and small, on their growth strategies and theexploitation of innovation in sectors ranging from biomedical to new media.

Public sector organisations have relied on her to design, implement and evaluate national andregional access to finance provision to encourage economic development. Notable successesinclude the Scottish Co-Investment Fund and, more recently, the £125m North East JEREMIEfund.

Heleen brings to the table substantial blue chip and international experience. She has a trackrecord of resolving board level issues consulting at McKinsey & Company, working in theNetherlands, Belgium, the UK, Sweden, Italy and France. She can also strongly relate to theentrepreneurial community, having run a telecom software start-up which folded during thebust of 2000.

Heleen has a MS in Chemistry from Leiden University in the Netherlands and an MS inManagement Science and Engineering from Stanford University.

While at Stanford, she helped set up the Stanford Technology Ventures Program, and co-wrote ”The Characteristics of the Entrepreneur“ (with T. Byers and R. Sutton), TechnologyManagement Handbook, ed. C. Dorff, CRC Press 1998.

She also holds certificates in Corporate Finance and Investment Management and is a COREaccredited mediator.

www.skillcast.co.uk

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Entrepreneurial Finance for Student Entrepreneurs in Europe_HKIST_REE090910