Closer cooperation between Finnvera's Venture Capital Investments and FiBAN
Finnvera’s Venture Capital Investments and the Finnish Business Angels Network FiBAN have signed an agreement on closer cooperation between Finland’s two large networks of business angels.
The free-of-charge InvestorExtra service launched by Finnvera in 2008 has expanded into a network of over 240 registered business angels. During this time, more than 300 start-up enterprises have been presented to the network as potential targets for investment. Alongside the establishment of FiBAN, the private business angel sector has become organised and has evolved rapidly during the past two years. In consequence, Finnvera decided to end the registration of new members for its own service at the end of 2012. A public actor must be active when operations are launched but must step aside when the private sector has the capacity to provide the same services.
Enterprises have been presented to business angels at a total of 29 ExtraEvents. Finnvera will still organise the events in 2013 in cooperation with FiBAN so that, after the events on 29 January and 12 March, invitations will only be sent to FiBAN’s members. FiBAN has made an offer to the business angels of InvestorExtra that would enable them to join FiBAN without a joining fee.
The cooperation agreement is a continuation of the operating model that evolved during 2012. FiBAN’s members have been invited to ExtraEvents since the beginning of 2012. Eight events were organised last year. In all, 64 enterprises that had applied for a business angel investment were selected for presentation at these events. The number of applicants totalled 208, of which 117 came through Finnvera’s application channel and 91 through FiBAN. The applications are reviewed by a jury of four business angels. Since August, the jury has consisted of FiBAN’s members. On average 40–50 business angels attended each event arranged in 2012. The presentations also included 25 enterprises from Finnvera’s own deal flow, from Vigo Accelerators, and from the NIY programme of Tekes targeted at young innovative growth enterprises.
Since the start of 2013, Finnvera has no longer taken applications for business angel investments. Applications for angel investments can now be filed through FiBAN.
FiBAN’s membership has grown rapidly, exceeding 250 members in January. At present, FiBAN’s database has about one hundred enterprises seeking financing from angels. It is estimated that the deal flow could reach 300 this year.
According to a survey conducted among business angels, the total value of investments made through the network during the first six months of 2012 exceeded 3.5 million euros. The rapid growth of membership and the tax incentive that business angels have been able to receive since the start of 2013 give reason to expect that investments made this year will reach at least 10 million euros.
About Finnvera’s Venture Capital Investments
In 2012, Finnvera’s Venture Capital Investments made initial investments in 23 enterprises and further investments in 41 enterprises. The total sum invested was 15.7 million euros. The investments made by business angels in these enterprises totalled 9.8 million euros. This was 13 per cent more than the investments made by business angels in Finnvera’s targets in 2011. Investments by angels were included in two-thirds of Finnvera’s investments. In total 115 business angels made 183 investments; thus, the average angel investment was roughly 53,000 euros.
At the end of 2012, Finnveras’ Venture Capital Investments had a portfolio of 138 enterprises. Finnvera’s investments in these enterprises totalled 75.3 million euros, while private investments totalled 145.8 million euros.
Leo Houtsonen, Finnvera’s Venture Capital Investments, +358 29 460 2733
Jan D. Oker-Blom, FiBAN, +358 40 551 7551