What a Blowuper is?

Surely you have seen a similar image to this in Linkedin, where a businessman is compared to an entrepreneur. Basically what the businessman does is to sell the same product more expensive, thanks to his commercial skills and / or to his Know-how of the product. The entrepreneur, on the other hand, transforms the product providing an added value detectable at first sight in order to sell it much more expensive.

Remaining in the superficial side, the image is shocking and the entrepreneur comes out very well. It doesn’t happen the same to the businessman, who, if we simply guide ourselves through the image, can almost be considered as a scammer.

In both cases, it does not refer to the costs incurred by acting one way or the other. In case of the businessman we do not know whether he has sold the product elsewhere or whether he sold it in a different moment from when he got it or even to whom he sold it. Of the entrepreneur we don’t know either what he needed to transform the product, if he needs other materials to produce it, how long took the production or if he needed any expert or f maybe he needed some extra knowledge.

The other day, having dinner with some friends, we discussed this issue due to the more classic economic activity of one of them and due to my sector. He trust more in traditional businesses and I defend that we live an exceptional time where every day a new business that is going to change the world comes up. The debate went on a long way and among other things, I thought, that there is another kind of entrepreneur who is presented as a model of success and who we should imitate. I baptized him as: Blowuper. It is, in essence, an entrepreneur who creates a “blow up” company, bloat by a lot Marketing and having as unique KPI the growth of the customer database. Customers who do not necessarily have to pay for the product or, at best, pay a price not higher than the cost (as in the picture below).

We live in an atypical age where the excess of liquidity is lowering the rigor in investment criteria. This situation gives wings to the Blowupers, who can bloat their bogged down businesses through this excess. These businesses, without this blockage and due to their business model, where the operating margin is negative (any financiers get their hair stand on end with this term), are doomed to fail.

In June it closed (less in Brazil) the Hispanic portal par excellence (Terra) and, before Google, the web browser par excellence was Altavista. Probably, when the expected correction in the system will be done, we will say phrases like: do you remember when they brought everything home? Or when a premium services car cheaper than a taxi was waiting for you? Do you remember the Snapchat? What happened to it all? Anything, the tide just went down. And it will be then when we would realize who was an Entrepreneur and who a Blowuper.

Signed by Guillem Comí

Consulting Companies: needs and opportunities

Consulting firms are increasingly seeking tools to manage corporate information for their clients, as they often do it in a non-optimal manner and often manually. Not only does this create increased costs and lost time, but it also limits communication and organization within a company. This leads to very few opportunities to innovate in the services offered and brings difficulties in facilitating the transparency of clients with stakeholders in a safe and controlled manner.

In this light, Private Investments Network presents a solution:

The Private Investments Network platform facilitates the use of a tool for managing the corporate information of clients and adds value to corporate clients by allowing consulting firms to:

  • Consolidate relationships with corporate customers as, using the platform, they gain control over a position in between the communication amongst the company and its shareholders and investors
  • Save time and costs when acting as the manager of information for different client profiles, such as startups, Private Equity firms, and family businesses
  • Differentiate themselves from the competition with a low cost tool, helping one to significantly increase revenue
  • Integrate the look and feel of the platform with that of the website of the consulting company
  • Benefit from an ERP at no cost
  • Encounter the opportunity to monetize off of additional services
  • Be perceived as innovative by offering existing and potential clients a digital solution managing the relation with their shareholders and investors, complementing the traditional services an accountant or auditor provides

If you want to know more, access our web: www.privateinvestmentsnetwork.com.

Are you in charge of managing corporate information in a Consultancy Firm? Tell us your experience by leaving a comment here.

 

 

The best crowdfunding platforms in Europe

This article will list and discuss the best Crowdfunding platforms in Europe. Perhaps the most famous case of Crowdfunding and Crowdsourcing to date is Barack Obama’s $750 million presidential campaign, completely raised through small donors in 2008. Following a recent boom in Crowdfunding platforms available online, a few platforms have now risen to the forefront of the industry, evolving the types and ways in which we can experience Crowdfunding; whilst other platforms failed to exist in light of heightened competition. Europe now being a regional hub for growing start-ups, this article will discuss the best Crowdfunding platforms available within Europe. These are naturally considered through the objective lenses of activity, total money raised, and the percentage of successful initiatives that these platforms have produced.

Access to traditional credit has been lacking, and thus Crowdfunding represents a new hope towards financing start-ups and innovative projects, by allowing one to fund projects and companies through smaller donations from the wider public.

Being the “lifeline” of SMEs and entrepreneurs of Europe, Crowdfunding platforms stand as the way to gain credit for ideas and projects by encouraging the participation and interaction of various actors in the professional and business environment. When the World Bank announced that Crowdfunding would value up to $90 billion between 2020 and 2025, and Forbes announced that Crowdfunding would value $90 billion by 2017, surpassing the trend of Venture Capital all together; the world (investors, start-ups, and regulators alike) realized it was time to join the trend.

The types of interaction one can experience between participants in these platforms vary immensely, allowing start-ups and investors to find which solutions fit their needs and desires the best: reward based Crowdfunding, credit based Crowdfunding, Crowdfunding through capital and Crowdfunding through donations.

These are often classed between two more common classifications: Financial Crowdfunding (focused on equity based Crowdfunding and Crowdlending) and Non-Financial Crowdfunding (focused on Crowdfunding through rewards and donations, also known as Crowdgiving).

Aside from our article on insights into the best Crowdfunding platforms available in Spain and in the United Kingdom, this list (organized in alphabetical order) will help understand the advantages and options available of the best platforms in Europe, particularly in light of the plethora of supplementary services and features platforms now offer to maintain a competitive edge.

Equity Based Crowdfunding

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Anaxago: Based in France, this platform holds a large membership community of over 67,000 individuals and promotes entrepreneurship, collective intelligence and transparency. Interestingly, this firm only allows companies to raise funds for 95 days at a time, allowing investors to be in the know about the investment far earlier. Having fully financed 82 firms thus far, Anaxago specializes in finding the funds for high-growth potential businesses. Authorized by the Financial Markets Authority (AMF), Anaxago has already successfully facilitated nearly €47 million worth of investments through their platform.

Bergfürst: Having facilitated over €6.67 million into 9 projects through the website, this German platform allows investors to invest into real estate offerings through fixed interest rates. This allows investors to feel increased security and predictability in their investments, while allowing individuals to bridge the gap between bank (and other) loans and the real estate project through mezzanine capital. Already approved to operate as a bank, Bergfürst has already performed its first IPOs and carries a community of an impressive over 13,500 registered investors.

Companisto: Having invested over €32 million, this German equity based Crowdfunding platform has managed to become a leader within the market, controlling up to 20% of domestic market share. Having successfully funded 64 companies thus far, Companisto differentiates itself by offering various forms of payment, ranging from payments directly through one´s credit card to instant money transfers to bank transfers, allowing investors to be located anywhere in the world.

CONDA: As both an equity based Crowdinvesting platform and a Crowdlending site, this Austrian platform aims to promote local investments alongside regional partners offering expertise. Having successfully funded 58 projects already, through facilitating up to €13.07 millions of investments, CONDA holds a large community of over 6,600 investors. Recognizing not only the financial benefits of investing into start-ups, CONDA promotes direct communication between entrepreneurs and investors, allowing investors to not only feel part of the team, but also contribute to a larger extent.

EOS Venture: This French equity based Crowdfunding operator aims to aid SMEs to develop to help progress the economy. As a FinTech company, EOS Venture has a French Investment Service Provider (PSI) status from the ACPR (French Prudential Supervision and Resolution Authority) of the Bank of France, illustrating their knowledge of financial operations and investment. EOS Venture has special agreements with European banks which allows them to go beyond the €1 million threshold that French regulators place upon them, allowing EOS Venture to have successfully facilitate €6 million worth of investments thus far, with the goal to reach €20 million in 2016.

EquityStartup: This very new Italian equity based Crowdfunding platform offers companies consulting services from legal advice to business plans, and beyond. Furthermore, EquityStartup informs investors of opportunities such as tax benefits that they are eligible for through their investments – they are sure to provide the know-how that many of us may lack.

Happy Capital: This French platform is more than a website to buy shares through – Happy Capital provides one the resources to validate their potential market and offers expert advisory services after the fundraising is complete to make sure the projects truly grow to have a positive impact on the French economy. Their requirement of companies to be registered with the French Trade Registry prior to the fundraising creates an increased sense of security for investors as well, making it unsurprising that Happy Capital has, since 2013, successfully facilitated €4 million worth of investments into successfully funding 20 projects.

Invesdor: This equity and debt based platform from Finland has already €16.32 million invested within its registered start-ups. Having successfully funded 62 projects to date, its success rate stands at 43%. Invesdor´s competitive edge however is seen in its supplementary services, from offering legal advice, to auditing services, to branding development, and much more, highlighting their long-term commitment to helping the companies registered in Invesdor to grow and making it the largest cross-border Nordic equity crowdfunding platform.

Mynbest: As a Spanish equity based Crowdfunding website, Mynbest maintains its competitive edge by providing an auxiliary service in addition to linking investors and companies: Mynbest provides investors with reports so as to remain engaged with their investments and be fully equipped with the information necessary for full security of their investment, which explains why their very first fully invested project reached a value of nearly €100,000.

OpenCircleProject: This platform is developed and managed by Parnasse S.A, a financial and economic advisor accredited by the EN.A alternative market of the Athens Stock Exchange. Focused on funding projects, this Greek equity based Crowdfunding platform provides the tools to value one’s company if they lack the current know-how. Although very new to the industry, OpenCircle Project has already facilitated €300,000 worth of investments into two companies, and are launching a line of larger investments in September this year.

Seedmatch: With almost €29 million successfully invested into start-ups, of which 93 projects had been funded, it remains unsurprising that Seedmatch maintained a 95% success rate. This German company focuses on the potential that young start-ups have to develop the local and global economic environments. With nearly 49,000 members within its network, Seedmatch holds 61% of the German market share alone.

Wiseed: With up to €56 million invested within the company, this French Crowdfunding platform has been able to successfully fund 134 projects thus far by a member base of 72,600. However alternative to the traditional start-ups that one would be funding through other platforms, Wiseed has specialized into real estate, that is, Wiseed allows one to invest into a start-up, a real estate property, or to gain funds through cooperatives. Authorized by the Financial Markets Authority (AMF), Wiseed largely focuses on highly professional projects.

Crowdlending

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FundedByMe: Offering both equity and debt based solutions, FundedByMe is an especially known platform within the arena of Crowdfunding. With over €24 million successfully invested into 453 start-ups, the Swedish company is home to a 69,200 member community from 178 countries and runs a 50% success rate. FundedByMe especially promotes its focus on cross-border investments, allowing collaboration from all over the world to occur.

MyMicroInvest: Based in Belgium, this company has managed to successfully fund 40 projects and carries over 34,000 members within its community. Furthermore, up to €23 million have been successfully invested through this Crowdlending platform towards 64 projects. To attract more investors, MyMicroInvest offers a unique transaction model where all investments made are bundled together and invested into the given company as one single entity. Not only does this bring more security to the investors, knowing that their money is not allocated if the start-up´s target is not reached, but also shows the platform´s commitment to backing all investments that it represents.

SmartAngels: This debt based Crowdfunding platform (although also offering equity based Crowdfunding services) was founded in France in 2012 with the aim to help investments flow into the growth of start-ups and SMEs. Having a large community of over 25,000 investors, SmartAngels has successfully financed 50 companies with a total amount of €25 million collected. Alternative to traditional Crowdlending services however, SmartAngels allows retail and professional investors to provide financing both through shares and bonds.

Symbid: Although based in the Netherlands, this platform has been strategically spreading throughout Europe. This Crowdfunding platform continues to differentiate itself by bundling a start-up´s financers into one shareholder cooperative, allowing start-ups to communicate more efficiently with only one entity. Whilst Symbid has successfully facilitated a Crowdfunding volume of €13.2 million into 128 campaigns alone, Symbid has also facilitated alternative funding options to SMEs through The Funding Network valuing over €500 million in 2015 and over €900 million in aggregate funding.

Non-Financial Crowdfunding

Derev: As a reward based Crowdfunding platform, almost 42,000 members actively participate within its platform within which €3 million have been successfully invested. This Italian platform has impressed many from the early stages, having raised over €500,000 within the initial two months of the Crowdfunding platform´s launch in 2013. Furthermore, Derev recorded the highest value of funding for an individual start-up in Italy, reaching over €1.46 million.

Kisskissbankbank: Based in France, this non-financial Crowdfunding platform has successfully facilitated investments totaling almost €55.4 million. In this regard, Kisskissbankbank holds a success rate of 58% of nearly 22,500 funded projects on its platform. Dedicated to fostering start-ups focused on creativity, solidarity and innovation, this platform aims to support companies that go beyond mainstream trends.

Ulule: With over a million members based in 190 countries, this French platform accommodates to international investors. Having successfully invested over €60.7 million into nearly 14,600 projects, it maintains a 68% success rate. However Ulule differentiates itself by offering two different fundraising types: a project manager or start-up may decide to set a fiscal budget target, or they may instead choose to target a specific number of items to pre-sell. Ulule offers even more flexibility by allowing start-ups to raise funds both through donations and through a reward based collaboration.

Wemakeit: Having successfully invested 16.4 million euros already into funding 1,945 projects, this Swiss Crowdfunding platform has held a high success rate of 65%. In order to allow the companies enlisted in their platform to prosper, Wemakeit also offers consulting services throughout the process, thus reaching the monetary target is not the only focus of the platform, but instead a means to reach a more substantial goal.

The several types of platforms allow investors and start-ups (and individuals) to find which strategy works best for them. From equity based Crowdfunding, to Crowdlending, to donations and rewards (granting the non-financial Crowdfunding option); alternative financing and Crowdsourcing strategies continue to develop.

Interestingly, the rise of bonds within Crowdfunding, instead of traditional loans has caught the eye of many. Financial laws and regulations within France have readjusted to this wave, making privately bought bonds (and many more forms of Crowdfunding) more secure and regulated – unlike much of Europe. Within this cross-link between the public and the private markets, one sees that the main difference between a bond in the private market, as supposed to a publicly traded market, is that an investor may not necessarily have the opportunity to gain their money back before the bond matures in several years’ time (as there is no public market to trade these bonds in). Potentially high-risk, these bonds however carry a high interest rate and therefore provide the opportunity for higher returns. One begins to see that choosing a financing scheme may be dependent simply on the convenience of giving and receiving returns; or on the preferences of other actors involved; or on local financial regulations, as well as many more factors. In this light, one should dedicate themselves to finding the optimal balance between each advantage for themselves.

As an investor, one may choose to become involved in a platform where more collaboration and consulting can occur, allowing the financing scheme to feel more inclusive. However for those that are hoping for short-term investments, platforms with short funding rounds allow investors to dip their toes into the world of Crowdfunding a little first. Similarly, a start-up or any individual looking for financing may prefer platforms that either offer supplementary services (to make sure you reach the finish line) or platforms that offer flexible types of financing to accommodate to different funding targets and objectives. Whilst Crowdfunding is not a new innovation, the opportunities these Crowdfunding platforms have brought mark a highly promising new era of collaborative financing.

Having discussed and highlighted the best Crowdfunding platforms available in Europe, one thing remains clear: choosing the best platform for you is really the only obstacle.

Signed by Sara Jokinen

Crowdfunding platforms in the UK

We would like to introduce you to the most interesting, as well as successful, crowdfunding platforms in the UK. We will look together at what distinguishes the following platforms and we will analyse them objectively, according to their activity numbers, total money raised over their existence and successfully completed campaigns and projects on the platform.

The UK currently presents the widest range of alternative funding options at a European level for SMEs and the entrepreneurs who are increasingly turning away from traditional financing institutions, as The European Alternative Finance Benchmarking Report casts light on some interesting numbers and the outstanding average annual growth rates we will see later in the article. The Cambridge Centre for Alternative Finance and EY have teamed up to produce this report that highlights the novelty of the alternative finance sector in terms of innovation at both business models and technological platforms level.

Let’s have a more in-depth look at one of the most noteworthy “branches” of alternative finance, the Crowdfunding platforms. The crowdfunding platforms are based on the different types of interaction amongst participants: Equity Crowdfunding, Debt Crowdfunding, Reward-based crowdfunding, Donation Crowdfunding.

Alternatively, we can look at crowdfunding platforms from two perspectives: Financial Crowdfunding -investors are financially recompensed for contributing to the project- (in this category we would then have Equity and Debt Crowdfunding) and Non-financial Crowdfunding –investors would receive either the product, for example, or they could contribute to donating for a project, in which case they would not be expecting any physical or financial reward- (here we are talking about the Reward-based crowdfunding and the Donation Crowdfunding).

The following list offers you a glimpse into the particularities of each of the platforms we analysed, respond to the questions of what they do and how they work, but also pool some hard data on their performance thus far.

Following we are looking at:

  1. Equity Crowdfunding platforms
  2. Debt Crowdfunding platforms
  3. Non-financial Crowdfunding platforms

Within these three categories, we are presenting the most noticeable crowdfunding platforms in the UK, sorted in alphabetical order.

  1. Equity Crowdfunding – in this case, the investors purchase registered securities from mostly early-stage firms.

The Data for the UK: 111m (transactions in 2014 showed a spectacular 420% average growth compared to 37m in 2013), according to Wardrop et al. (2015).

Crowd2fund is the only FCA regulated platform to offer solutions across 5 models of finance: Donations, Loan, Revenue, Bonds, Equity. Crowd2fund relies on an alternative to traditional finance that offers a fast, fair and flexible solution. One of the latest projects on their platform raised £503,000 offering equity stakes to investors in Rezonence: BBC Worldwide Incubated Advertising Technology.

CrowdCube is definitely one of the most noteworthy equity (and debt) platforms in the UK, especially given that its user-base comprises a very wide range of investors (from professional investors and VCs to individual investors) backing up both early, as well as growth stage businesses. CrowdCube operates internationally and has some impressive global numbers, but they also provide us with an insight into their UK performance: £1,889,580 (average equity investment), 55% success rate in the last year (290 projects funded by selling £101,376,177 worth of equity stakes). What we found most interesting here is that the most popular sectors are Technology, Food & Drink and Consumer Products, which clearly indicates the appetite of individual investors for investing in businesses they believe in from a consumer point of view. One remarkable success story is The Pressery reaching their £150,000 target in less than two hours. Since 2011, more than 285,000 people have registered with Crowdcube, helping to raise over £165 million in 407 raises for businesses.

Growth Deck – This equity crowdfunding platform stands out in terms of customer service offered to investors and two strong teams for sound investment review, as well as sector review, catering to the best needs of their investor user-base, as well as businesses user-base. Growth Deck focuses on mediating funding for growing UK companies with a promise of Transparency, Trust, Expertise and Support. The platform currently counts on 3,751 investors.

Seedrs – Despite its name, Seedrs specializes in equity crowdfunding for companies throughout their lifecycle based in the UK, but it is also open to investors and businesses in Europe. On Seedrs, investments start at as little as £10, but the platform has seen 320 deals being completed since launch and is one of the leading of its kind in the UK. It is the UK equity platform with most users and has raised £150 million in total investments to date from 38,000 investors. The platform is highly comprehensive, with a wide range of articles and case studies, trying to provide the best help and information for their high number of individual investors.

Syndicate Room – Our favourite aspect of the Syndicate Room equity crowdfunding platform is the “investor-led model”, which means individual investors can only invest in projects that already have an angel investor or an early-stage investor on board. Thanks to this approach, we see once again the pursuit of crowdfunding platforms of providing fair investment opportunities to individual investors and reducing the inequality of information and subsequent inequality in terms of opportunities that tend to separate professional investors and individual investors in the case of traditional financing. The equity crowdfunding platform has raised £55,394,577, funding 86 projects successfully.

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  1. Debt Crowdfunding platforms – This kind of platform implies debt-based transactions between an individual or an institutional investor and existing businesses (mostly SMEs). This kind of crowdfunding platform is seeking to provide a fair alternative for investors and businesses alike to obtain returns and financing at better rates and terms than traditional financing methods. The main difference we would like to point out thus far between equity crowdfunding and debt crowdfunding is that, while equity crowdfunding often features seed-stage or very early stage startups, debt crowdfunding usually provides financing to growing businesses, who have a record of their past operations and development processes and can provide investors with a sound proof that guarantees the business will be able to generate future returns and ultimately pay back the debt financing obtained.

The Data for the UK: €998m (2014) 253% average growth rate (2014 compared to 2013), according to Wardrop et al. (2015).

Funding Circle – The platform focuses on providing an alternative financing method exclusively for small businesses. Although its main activity is in the UK market, the platform provides loans to small businesses in the USA, Germany, Spain and the Netherlands too. The platform discloses numbers such as 55,000 investors in the UK who have lent to businesses, £2 billion across these five markets and an estimated 7.1% yearly return. The average loan amount on Funding Circle is £60,000.

Funding Knight –This British-based crowdlending platform offers three choices for entrepreneurs looking for a loan: a business loan, a property bridging loan and a green energy loan. The platform connects investors and businesses at a rate that works for both. Run by a dedicated team, the online crowdlending platform offers a wide range of articles and information on alternative finance and we think their efforts to educate the audience is benefiting both sides. FundingKnight has financed 224 projects, for a total of £30,712,000.

Rebuilding Society – With numbers such as £9.7 million in loans and more than 150 projects finances, Rebuilding Society focuses on the idea of community and strives to “rebuild society” by cutting out waste and employing money in an efficient way that benefits the society and its actors, rather than the intermediary institution as it is often the case in traditional financing methods.

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  1. Non-financial Crowdfunding platforms

The Data for the UK: €34m (176% average growth rate (2014 compared to 2013)), according to Wardrop et al. (2015).

BloomVC Bloom VC is a reward-based crowdfunding platform that caters for any kind of early stage start-up business, community, arts or culture that needs a small amount of cash to get going. The average “promise” of a member is £46 and through the power of getting together like-minded people, BloomVC has seen 43% of the published projects being funded, out of which 85% have exceeded their targets.

BuzzBnk Launched in 2011 as the first crowdfunding platform specifically for social enterprises and charities, BuzzBnk has successfully funded 139 projects with a total of £1,051,229. The crowdfunding platform informs us their projects seek to raise amounts varying from £1,000 to £30,000 in units of £10 to £200. BuzzBnk prides itself on welcoming social enterprise and charity projects indifferent of their size. The crowdfunding platform has had projects as small as £600 and as large as £100,000.

Crowdfunderis the rewards and community shares sibling platform of equity crowdfunding platform, CrowdCube. Crowdfunder defines itself as UK’s fastest growing crowdfunding platform and their numbers verify the statement: 500,000 members of the Crowdfunder community have contributed to turning 40,000 projects into reality and a total of £25 million raised so far. What we have found most interesting is that the Category with the largest number of projects is the Community one (£1,792,751 funds raised so far in this category), which indicates again a strong tendency for like-minded people to gather and initiate, as well as support, projects aimed at improving their lives within the society. The next category in popularity is Business projects, followed by Charities, Sports, Food & Drink and Film & Theatre.

Having seen the types of alternative finance an entrepreneur can rely on at the time of using a crowdfunding platform, we are confident our readers have gained a better grasp of crowdfunding platforms and initiatives and can now align their entrepreneurial interests with searching the right type of funding from like-minded individuals who will be able to support and create a real community around one´s ideas.

We would say crowdfunding platforms (be it equity, debt or non-financial rewards) are as much about the raise of funds as they are about raising awareness and receiving support (not restricted to financial support), issues of great interest to the innovative minds of entrepreneurs and community leaders.

Signed by Vicky Corneanu

A tool for Family Offices and Business Angels

Family Offices and Business AngelsFamily Offices and Business Angels are increasingly struggling to have efficient portfolio management and portfolio reporting. This limits their capacity to analyze their own portfolio and causes them to lose valuable time and money. In addition to this, Family Offices and Business Angels experience difficulties controlling meetings and tasks in order to provide smart capital.

In this light, Private Investments Network presents a solution:

The Private Investments Network platform facilitates the use of a tool for managing portfolio information and to continue to add value to the portfolio by allowing family offices and business angels to:

  • Facilitate the process of uploading company information
  • Same time and management costs, increasing productivity
  • Automatically receive investee companies’ information, as well as key performance indicators that are organized and automated
  • Promote Mentoring and Smart Capital processes
  • Monitor an updated evolution (with access to historical records) of the companies that currently are, and previously were, in the portfolio
  • Identify the value of unlisted shares

If you want to know more, access our web: www.privateinvestmentsnetwork.com.

Do you have to manage your investment portfolio? Tell us your experience by leaving a comment here.

Venture Capital Funds: needs and challenges

Venture Capital FundsVenture Capital Funds are increasingly experiencing difficulty in obtaining corporate information when needed. This is due to decentralized information causing a lot of work in completing reports. In addition to this, Venture Capital Funds struggle to manage their relations with investors and Limited Partners.

In this light, Private Investments Network presents a solution:

The Private Investments Network platform facilitates the use of a tool for managing corporate information by allowing venture capital funds to:

  • Automate information uploaded by companies
  • Follow the evolution of the invested companies and have information displayed and available in a simple, practical and centralized dashboard
  • Save time and management costs and increase productivity
  • Facilitate Smart Capital and Mentoring processes
  • Automate reports to Limited Partners, allowing fast and efficient reports through the corporate website
  • Have invested companies at the forefront of best practices with regards to transparency with investors (made to facilitate the exit)
  • Have easy and automated investor relations with a secure channel through the corporate website

If you want to know more, access our web: www.privateinvestmentsnetwork.com.

Are you in charge of managing corporate information at a Venture Capital Fund? Tell us your experience by leaving a comment here.

Family businesses and the relationship with shareholders

Family Businesses
Family businesses are increasingly experiencing a lack of a formal, fluid channel of communication and disordered communication within their company. They encounter decentralized information and a lot of work in completing reports. This leads to difficulty managing meetings and completing their assigned tasks.

Based on a study from IESE, launched earlier this year, we decided to highlight some of the most relevant points concerning family businesses that influence the way they communicate and their relation to shareholders.

  • Family businesses represent 85% of all Spanish businesses and create 75% of private sector employment, based on data from the Instituto de Empresa Familiar en España (Institute of Family Business in Spain).
  • Nearly 80% of respondents considered that the existence of formal communication mechanisms promote family involvement within the business, strengthening the evolution and the growth of a company, helping them convey family values, contributing to the continuity of the company and improving the quality of family relations.
  • Almost 60% of respondents said that in their companies there was no formal communication mechanism intended for family businesses. In the majority of cases, there are no established processes, nor tools, nor channels to communicate with stakeholders of the company.
  • 64% of family respondents enjoy family meetings in order to convey corporate information. The majority of respondents acknowledge that the communications with partners and shareholders is not as fluid as it should be.

In this light, Private Investments Network presents a solution:

The Private Investments Network platform facilitates the use of a tool for managing corporate information by allowing family businesses to:

  • Have a formal and fluid channel of communication with the possibility to segment stakeholders into groups
  • Have centralized information with a historical record and the ability to conduct automated reports
  • Have a simple tool to manage meetings with a historical record of calls, documents, and assigned tasks
  • Display information about KPIs that are predefined and automated
  • Manage documents on the platform at any time, including controlling access to them, as well as modifying the documents and creating several versions
  • Identify the value of the business’s unlisted shares
  • Have the option to open for intentions to buy and sell shares between shareholders and potential investors, while limiting their access and determining specific period of time for buying and selling

Furthermore, Private Investments Network’s key features continue to add value to different users of the platform

Family members:

  • Have a straightforward family members’ forum system that allows users to open a topic and invite other users to see and comment on it
  • Determine limited access and the possibility to designate view-only access to documents
  • Have direct links with access to the meeting agendas and voting enablement
  • Click to call, allowing shareholders to automatically call a basic help line service open from 9:00 to 18:00 on week days, including 6,000 incoming calls

Corporate Administrators and Managers:

  • Enable voting with specific span
  • In the details of the agenda, one can report an issue, describe every article and specify assistants
  • Add documents and determine whether they are read-only or can also be downloaded and/or printed
  • Report, during the meeting, the number of those present and remote assistants
  • Have the possibility to create a new “Responsible” manager to validate changes of secondary managers
  • Have the possibility to indicate, for every shareholder, the number of any series of shares

Board of Directors:

  • Have a private portal created in the cloud in order to have a different server from the intranet for shareholders
  • Have classified information that is restricted to the board of directors in a distinct environment
  • Allocate one’s own corporate administration manager that can be the same or different from that of the general platform
  • Have each system with its own information independently, without unwanted synchronization

Managers of large volumes of information:

  • Intelligent search engine for the shareholders list
  • Possibility to export to Excel the information available on the screen (investors list, the list of assistants to a meeting, and more.)
  • More options to segment the permits of a manager

Are you in charge of managing corporate information in a Family Business? Tell us your experience by leaving a comment here.

Fdo. Helena Lopes y Sara Jokinen.

Corporate governance: its importance for unlisted companies

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Based on “Recomendaciones de Buen Gobierno Corporativo para empresas no cotizadas” (“Recommendations for Good Corporate Governance for unlisted companies”), an excellent study realized by IE Business School and Grant Thornton, from Private Investments Network we want to point out several recommendations and best practices for unlisted companies that we have found most interesting.

 “All companies have to ensure an environment characterized by quality and integrity of information that is used by the Board of directors to take the best decisions”, claims Antonio Garcia-Lozano, Consulting Leader at Grant Thornton.

Listed companies follow corporate governance policies that are essential for the relationship with shareholders and, a logical question that the study sheds light on is: why not follow such policies in unlisted companies in order to achieve high performing boards of directors?

 “Unlisted companies make up 85% of the Spanish industrial landscape. Nevertheless, the majority of the legislation and recommendations in force, as far as good corporate governance is concerned, is directed exclusively to listed companies. Extending good corporate governance to more business segments implies strengthening the sustainability and development of our companies and, by extension, our economy and society”, says Tomas Garicano, director of Good Governance Centre, professor at IE Business School and Senior Advisor in Corporate Governance for Grant Thornton.

The study is aimed at unlisted companies with an annual turnover higher than 750 million euros or an average personnel of more than 1,500 workers. Following, we highlight the main recommendations:

  • The partners have to establish a corporate governance framework that, taking into consideration the regulations in force, adapts to their needs, their size and to the complexity of their operations
  • It is appropriate distinguishing amongst the governance activities, administration, approval and supervision, entrusted to the board of directors, and operational management activities, entrusted to the executive board and the organizational structure of the company
  • The members of the board of directors need to allocate the time needed to perform the tasks, meet periodically, assist to convened meetings and rely on timely information, the necessary advice and adequate training
  • To ensure the transparency of information, it is recommended that companies disclose in an official channel the required reports or volunteers (auditor independence, committee reports and audit appointments and remuneration, if any, related operations and corporate social responsibility)
  • There should be an information system that allows reviewing of topics prior to meetings and gathering, facilitating communication between members and optimizing meetings
  • It is advisable to maintain sufficiently comprehensive minutes. The minutes of the meetings of the board are a reflection of what happened in those meetings and the relevance and depth of the issues discussed. They should be broad enough to capture both the matters discussed, such as the views expressed by the directors and their decisions made, avoiding various communication versions.
  • It is important to have a system of relations with shareholders, allowing one to know their opinions, interests, and expectations; particularly when they are not all represented on the board. The system should have a continuous relations approach over time, aiming for a periodic relationship that goes beyond the meetings of the board of directors or holding the annual general meeting.
  • One should at least communicate: financial and non-financial information, internal and external, of the present and future; that includes at minimum the issues related to the present situation and financial prospects of the company, the strategic plan, and its implementation risks, regulatory compliance, market and competitors; and, aspects of internal management and human resources.

From Private Investments Network, we offer a tool that allows unlisted companies to follow these policies within a private and secure environment, providing solutions to enhance the relationship with shareholders and other internal stakeholders.

The features of our platform allow one to maintain a transparent, segmented, and secure communication, managing processes such as: meetings, tasks, metrics, documents and even capital increases.

If you would like to know more details about how Private Investments Network helps companies, click here.

 

What is RegTech?

RegTech

RegTech is a new concept derived from the definition of FinTech primarily signifying the technology applied to resolve issues regarding regulation within the financial industry. It helps companies to better manage and understand their legal risks as well to easily adhere to their regulatory obligations.

This is due to today’s new technologies giving rise to new regulatory necessities and the market’s legal framework often being slow in adapting to and accompanying the speed of these changes within the environment. After a disruption of the market, through new FinTech solutions arising, RegTech helps to adapt the regulatory, financial services and general professional services sectors to these changes.

Adapting to the speed of these changes is key for companies and the governments of any nation, guaranteeing that all those involved will benefit from the arising innovations within the financial industry. In this sense, the technology acts as an important frame of support to expedite, integrate, and automate this process of adaptation to regulations and even to create and audit, therefore offering security and reliability for these governments and companies involved.

The consulting company, Deloitte, announced in a report released in January this year that RegTech could already be considered the new FinTech, referring to companies that offer technology for the financial sector, a concept which is currently trending.

This roots to their belief that that there is a hole that is not being completely considered in the innovations and trends of the financial sector, simply described as the norms and regulations in place.

regtech
Similarly, an article released this March by RegTechFS discusses how regulators were often left out of the conversation of technological advancements, as they were not previously involved in how business is conducted. Filling this hole not only provides regulatory systems an opportunity to progress, but also allows other industries to move further along, not being held back by regulatory challenges.

According to the Deloitte report, “in the short term, RegTech will help companies to automate prevalent tasks of compliance and to reduce the operational risks associated with compliance and reporting obligations”.

Applying technology to issues of regulation is not particularly new, however some of the characteristics that bring and differentiate the concept of RegTech specifically are agility, velocity, integration and the possibility of analysis. According to the Deloitte report, RegTech “provides executives a higher level of opportunity to introduce new capacities that are designed to take advantage of the systems for the obtaining of normative data and the presentation of reports in a profitable, flexible, and timely manner, without running risks of replacing the existing legal systems”.

Examples of companies (according to Deloitte) that already can be considered to be within the RegTech sector include:

  • Fund Recs: Based in Ireland since 2013, Fund Recs focuses on providing a reconciliation platform to progress data management and processes in the Funds Industry. Not only does this allow data leveraging to become more efficient, powerful, and cost effective; but Fund Recs believes that day-to-day business softwares should be well designed and easy to use, making the overall platform applicable to any business. Fund Recs recently took the step forward to also launch their VELOCITY platform for Fund Administrators to develop valuations efficiently.
  • Silverfinch: Part of the MoneyMate Group, establishes connectivity between asset managers and insurers by providing fund data utility through a platform that is safe and controlled. As a self-service tool by design, Silverfinch gives the user increased control whilst still offering training, support, and establishing connectivity within Silverfinch. Through this secure platform, competitors have no access to proprietary information, while insurers can still keep up with their solvency regulation requirements through connectivity with asset managers,
  • Trustev: Based in Ireland, this RegTech company combines machine learning and human intelligence to look holistically at data from online transactions and events. Trustev then scans these transactions, all in real time, to catch potential fraud. Allowing one to reduce fraud allows one to stop fiscal leaks and operative challenges faced by fraud, whilst not affecting the genuine customers that one interacts with.
  • TradeFlow: As a platform operated by Expeditors, TradeFlow provides information on tariff data and regulations, compliance, expected costs of various operations, and much more, to assist both importers and exporters in combating challenges they may face when partaking in international trade. Tradeflow operates as a supply chain tool to make international trade easier, by making international regulations easier to follow, therefore allowing global trade to grow.
  • Vizor: Now operating in 30 countries, Vizor serves both companies and financial regulators. Through Vizor’s software, a company can see and understand all their financial regulatory requirements and have full knowledge of any gaps. Regulators can easily track companies and see which firms are meeting their regulatory obligations. Not only does this create ease in meeting obligations, but it also shows that greater trust within this industry can be built.
  • Corlytics: The Corlytics Financial Fines Database is platform of financial fines providing information on a global scale on financial institutions, regulators, fining authorities, fine parameters, and more. Using analytics technology, the database is further connected to global cases and regulators, allowing further insight. Corlytic´s database allows companies access to trends and analysis, as well as the opportunity to identify potential risks and loss estimations.
  • KYC3: Founded in 2013, KYC3 focuses on three themes: compliance, counterparty risk management, and competitive intelligence. Providing instant reports from compliance, to political risk management, to networks of influence, and much more, KYC3 allows one to complete all due diligence tasks, be efficient, meet compliance regulations, and discover further opportunities and threats. Using big data, KYC3 delivers data mining and analysis solutions to you.
  • TheMarketsTrust: Based in Luxembourg, TheMarketsTrust provides solutions to risk analysis through insights into the financial industry and offering advisory services through financial knowledge and by leveraging their expertise of technology. Through an in-house research team, TheMarketsTrust aims to be both unique and customer-centric, providing solutions to one’s specific needs.
  • AssetLogic: As a fund information network, AssetLogic allows one to aggregate all their data and information into an online location in little time. Through this tool, one can share information and data with whoever they like, allowing more efficient use of this data. Not only will compliance work more effectively, but all sides of an organization will benefit, from investor relationships, to marketing, and more.
  • FundApps: This RegTech platform allows one to automate their compliance monitoring by entering a collaborative community in which industry experts manage the community and help companies be aware of threats and opportunities. Combining high-end technology and experienced industry experts, FundApps aims to deliver quickly, efficiently, and effectively, by harmonizing technology and content.

The advantages of RegTech can be well applied tools of:

  • Analysis of gaps in legislation and regulation
  • Real-time information
  • Compliance and investor relations
  • Information management
  • Reporting of transactions and regulatory reports
  • Storages of risk data
  • Data aggregation, analysis, and sharing
  • Loss, profit, and risk estimations

RegTech represents an opportunity to companies that develop this type of technology, although the challenge currently is to know to apply it well and to do so with an agile manner with regards to technological changes, offering a real competitive edge for companies.

Private Investment Networks similarly shares this vision on RegTech, both fostering and advancing the world of FinTech that we experience today. Through its many roles, RegTech can act as a facilitator of compliance for companies, allowing them to meet regulatory obligations, whilst also fostering the investors’ relations tasks that a company may conduct, as it does in Private Investments Network.

As FinTech advances, the hopes are that we can take a step back and see if there is a missing link or hole in this chain of innovation, as these RegTech firms have done, and consider how compliance and regulatory obligations can be both met with ease, as well as advanced to help our companies innovate further.

Fdo. Helena Lopes and Sara Jokinen.

Private Investments Network is recognized by the French Finance Innovation Cluster

Finance innovation
Private Investments Network is extremely happy and grateful to have received the recognition from the Finance Innovation Cluster, the grouping of private/public competitiveness of the Paris Europlace that promotes technological innovation in the financial sector.

This recognition is given to projects with high potential at the European level and which are:

  • Innovation: Particularly with regard to techniques used, the implemented models, customer segments, the developed technologies and the covered risks;
  • Strategic for the French financial industry: Bringing new products or new customers, facilitating international competitiveness, meeting the needs of the economy and increasing employment support;
  • Credible: Verified partner skills, technical feasibility and financial viability of the project.

The selection of projects that are recognized is made by the members of the Finance Innovation Cluster, which is represented by major financial sector institutions in France.

Here you are able to view the pitch presented by the CEO and co-founder of Private Investments Network, François-Eric Perquel, at the Finance Innovation Cluster.

And here you can watch the video with the presentation (it is in French).

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