Presentation on Business Angel Networks in Germany and Serbia for the 7th Int. SME Conference of the Serbian Ministry of Economy & Regional Development in Belgrade on October 4th, 2011.

1. 7th MERR International SMEs Conference
f
Workshop 4: New Instrument for Financing of
Innovative SMEs
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH
ACCESS
Programme for Private Sector Development in Serbia
Belgrade, 4th October, 2011
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2. Business Angel Networks
Status quo in Germany & Cooperation with the
Serbian Business Angel Network (SBAN)
Jürgen Kappenmann
Consultant GIZ ACCESS
KARER CONSULTING AG
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3. Content
 Introduction GIZ ACCESS
 Status quo in Germany
 Role & Functions of Business Angels
 Figures & Trends - Business Angels in Germany
 Business Angel Networks in Germany
 Cooperation with SBAN
 Capacity Building SBAN & Knowledge Transfer
 Model “Innovative Projects Cycle 2010”
 Current Issues
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4. ACCESS Structure
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5. Role & Function of Business Angels
Capital Know-how
 Economically independent  Knowledge
private investors
 Experience
 Investment between  Network & Contacts
50.000 and 500.000 EUR
 Interested in Return on Coaching
Investment Fun
Definition: Business Angels are high net worth individuals investing their
own money and their management/entrepreneurial experience into
unquoted high growth potential start-ups and SMEs (= Smart Capital).
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6. Figures & Trends – BAs in Germany
 Number of BAs:
more than 5.000 (UK: 20K, USA: 230K)
 Accumulated Average Investment per Business Angel:
27.000 € in Q2 2011 (down from 100K € in 2008, in UK ~ 48K €)
 Total Volume of Early Stage Investment Asset Class:
over 400 Mio. € (~ 4 bill. € in Europe in 2010 from 1 bill. € in 2005)
 Capital Ownership Percentage:
15% are majority owners, 54% hold less than 10% (in Q2 2011)
 Targeted Companies:
Companies with high growth potential, excellent management & clear exit strategy
 Preferred Industries (Q2 2011):
Energy, E-business, Environmental Techn., Medical Equipment, New Materials
 Number of Received Business Plans per BA:
17 per Q2 (from 19,5 in Q1 2011)
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7. BAND – Business Angel Network Germany
 Founded in 1998, support the BA market and build up a “New Culture of
Entrepreneurship”
 Role, Function & Activities
 Umbrella organization of the informal venture capital market in Germany
 Representation of business angel networks towards public & public sector
 PR, awareness campaigns (Business Angel Year 2010), trainings etc.
 Quarterly Business Angel Panel
 Annual Matchmaking Event German Business Angel Day
 43 Regional and Local Networks (network types)
 Network as a Public Project (50%)
 Network as a (Business) Association (30%)
 Network as a private Club
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8. Example: Netzwerk Nordbayern
 Definition: Business Angel Networks are national or regional, local, commercial
or industry sector organizations set up to promote means of introduction between
young innovative SMEs and private investors with entrepreneurial experience
(business angels).
 Role & Services for SMEs and Start-ups:
 Service Provider: information, know-how, consulting, financing, networking,
planning
 BA Networks provide certain standards and best practices
 Active cooperation of many partners in the region guarantees target-
oriented and precise support
 Essential function: provision of networking through opening important
contact and communication channels
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9. Example: Netzwerk Nordbayern (Partner Network)
Ministry of
Economy
Business
Uni-
Angels &
versities
VCs
Chamber
Companies of Comm-
erce
Network
Northern Bavaria Innovation
Business
& Techno-
Asso-
logy
ciations
Centres
Jurors
Industry Business
Clusters Plan
Contest
Public
Sponsors
Entities
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10. Model Project Cycle 2010 - Overview
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11. Model Project Cycle 2010 – Ideas & Selection
 Selection of 15 Ideas (out of 150+)
 “One Pager”
 Involvement of partner network
 Ideas from different industries
 IT & SW Develop., E-business
 Energy & Environmental Technology
 Food
 Media & Entertainment
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12. Model Project Cycle 2010 - Trainings & Coachings
 6 Training & Coaching Sessions were held (5 + Legal)
 Based on the “Ready for Equity - Training for Business Angel and
Entrepreneurs” scheme
No. Trainings
1 Business Angels and Equity Market
How to Prepare for Meetings with Investors (executive summary, team
2
building, enterprise value)
3 The Perfect Presentation
4 Negotiations
5 Coaching Sessions
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13. Model Project Cycle 2010 – Matchmaking
 Organization of Investment Conferences (“matchmaking”)
 Local
 Regional
 Matchmaking according to a defined presentation procedure (“pitching”)
 17 investors present during the first investment conference alone
 Results:
 15 companies trained for matchmaking with investors
 “quality deal flow” initiated
 first negotiations between companies on concrete investments
 SBAN established as a serious player in the field
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14. Current Issues
 General
 Impact of the global financial crisis
 Enterprise Investment Scheme (EIS)
 (Organized) syndication
 Growing recognition of BAs´ in SME development
 In Serbia (start-ups, SMEs, BAs)
 About 45% of start-up companies don’t survive first two years of operations
 Complex and expensive procedures and regulations in whole life cycle
 Access to financing is one of the key issues
 Taxation issues for investors
 Capacity building for SBAN: institutional and financial support
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15. Thank you
for your attention
Contact
GIZ / ACCESS
Program Leader
Tobias Stolz
Makenzijeva 24/5
11 000 Belgrade, Serbia
Tel.: +381 11 240 03 71
Tobias.Stolz@giz.de
www.giz.de
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