22
de Setembre
de
2015
Act.
22
de Setembre
de
2015
Spain is a country with a heavy dependence on funding from banks, around 70%, very different from other economic cultures where alternatives to banks won over investors and businesses years ago. Without even mentioning Anglo-Saxon countries, where the percentage is just about the opposite (70% alternatives to 30% from banks), neighbouring countries, such as France and Germany, have a 50-50 balance. "We are heavily dependent on banks", says Ramon Saltor, CEO of The Crowd Angel, a leading equity crowdfunding platform in Spain, with its HQ in Barcelona.
However, since the new Crowdfunding law was passed in April and the reduction in the number of banks in Spain (from 65 in 2009 to 16 in 2013), banks are no longer the only option for funding business growth. Housing is now history and professional investors no longer look to the classic asset of bricks and mortar. "Until now, banks dominated because there were no alternatives. They had a much more physical presence with their networks of branches and, what's more, we are a country with less of a funding culture compared to other countries," says Eloi Noya, manager of the Loans and Risk Department of LoanBook, a leading crowdlending platform for small to medium-sized companies.
According to the report, Moving Mainstream. The European Alternative Finance Benchmarking Report, published by Cambridge University, the alternative funding market grew by 144% in Europe last year. "A sector has to be regulated to protect everyone and here alternative funding platforms are appearing; now all of us have the same last name. We need confidence and security, for both the investor and the small to medium-sized company to continue growing," says Saltor. Since the regulations were passed, The Crowd Angel has experienced a change: "The last three operations we have launched were funded in record time; now there is more demand for investment than supply."
Specifically, the Barcelona platform deals with investment tranches of, on average, between 50,000 and 300,000 euros, normally with technology-based start-ups. In all, it has carried 10 operations to conclusion, involving more than 165 investors who have invested more than two and a half million euros in 10 start-ups.
The 'crowdfounding' tag
Given this scenario and the aim that Catalan companies become more competitive and have access to all types of funding, the Generalitat has published the second edition of the Catàleg de Finançament Alternatiu, a tool that brings together different types of platforms that are currently funding Catalan companies, both in terms of capital and debt. "Imagine you are a small company in the health sector and you need a million euros in capital. Where are you going to find that investment? This catalogue avoids you having to knock on 15 different doors," says Sandra Font, head of international and alternative funding at ACCIÓ, who adds that "alternative and bank funding have to complement one another".
The Crowd Angel and LoanBook are two of the platforms in the catalogue, together with 85 non-banking financial instruments as well as equity crowdfounding, invoice trading, crowdlending and business angels. Moreover, these bodies are waiting to receive the Generalitat's seal of quality, which vouches that these platforms comply with a series of requirements, such as having more than 20 investors registered, that they have provided funding to the tune of at least 100,000 euros and that they have carried at least two operations to a successful conclusion. "We are an association for those who are not comfortable without regulation, which is why this catalogue benefits us," adds Noya.
LoanBook's team
The head of international and alternative funding at LoanBook defends another style of funding than micro-patronage, which is less well-known than crowdfunding, but which is growing at the same rate: crowdlending, a collective loan between different investors. "Our value lies in agility and speed, both in the analysis of risk for the small to medium-sized business as for the capacity to complete the auction and obtain the necessary funding," says Noya, who adds that for a plataform to be successful it is very importantto carry out a good risk analysis of the companies.
LoanBookwill end September with five million euros of business completed, 160 loans and more than 50 companies funded. "We do not normally substitute a bank, we complement it," concludes the manager.
However, since the new Crowdfunding law was passed in April and the reduction in the number of banks in Spain (from 65 in 2009 to 16 in 2013), banks are no longer the only option for funding business growth. Housing is now history and professional investors no longer look to the classic asset of bricks and mortar. "Until now, banks dominated because there were no alternatives. They had a much more physical presence with their networks of branches and, what's more, we are a country with less of a funding culture compared to other countries," says Eloi Noya, manager of the Loans and Risk Department of LoanBook, a leading crowdlending platform for small to medium-sized companies.
According to the report, Moving Mainstream. The European Alternative Finance Benchmarking Report, published by Cambridge University, the alternative funding market grew by 144% in Europe last year. "A sector has to be regulated to protect everyone and here alternative funding platforms are appearing; now all of us have the same last name. We need confidence and security, for both the investor and the small to medium-sized company to continue growing," says Saltor. Since the regulations were passed, The Crowd Angel has experienced a change: "The last three operations we have launched were funded in record time; now there is more demand for investment than supply."
Specifically, the Barcelona platform deals with investment tranches of, on average, between 50,000 and 300,000 euros, normally with technology-based start-ups. In all, it has carried 10 operations to conclusion, involving more than 165 investors who have invested more than two and a half million euros in 10 start-ups.
The 'crowdfounding' tag
Given this scenario and the aim that Catalan companies become more competitive and have access to all types of funding, the Generalitat has published the second edition of the Catàleg de Finançament Alternatiu, a tool that brings together different types of platforms that are currently funding Catalan companies, both in terms of capital and debt. "Imagine you are a small company in the health sector and you need a million euros in capital. Where are you going to find that investment? This catalogue avoids you having to knock on 15 different doors," says Sandra Font, head of international and alternative funding at ACCIÓ, who adds that "alternative and bank funding have to complement one another".
The Crowd Angel and LoanBook are two of the platforms in the catalogue, together with 85 non-banking financial instruments as well as equity crowdfounding, invoice trading, crowdlending and business angels. Moreover, these bodies are waiting to receive the Generalitat's seal of quality, which vouches that these platforms comply with a series of requirements, such as having more than 20 investors registered, that they have provided funding to the tune of at least 100,000 euros and that they have carried at least two operations to a successful conclusion. "We are an association for those who are not comfortable without regulation, which is why this catalogue benefits us," adds Noya.
LoanBook's team
The head of international and alternative funding at LoanBook defends another style of funding than micro-patronage, which is less well-known than crowdfunding, but which is growing at the same rate: crowdlending, a collective loan between different investors. "Our value lies in agility and speed, both in the analysis of risk for the small to medium-sized business as for the capacity to complete the auction and obtain the necessary funding," says Noya, who adds that for a plataform to be successful it is very importantto carry out a good risk analysis of the companies.
LoanBookwill end September with five million euros of business completed, 160 loans and more than 50 companies funded. "We do not normally substitute a bank, we complement it," concludes the manager.