#ficompass

Combining ESIF financial instruments and crowdfunding

Irene Schucht, Head of Strategy and Products, Investitionsbank Berlin, Germany

1

• IBB is the business development bank of the Federal State of Berlin, an independent institution

incorporated under public law and under the control of the Federal Financial Supervisory Authority

(BaFin)

• Balance-sheet sum: EUR 17.7bn

• 630 employees

• IBB provides financial instruments for business

development, housing, climate protection and

infrastructure

• IBB focuses on supporting start-ups, SMEs and social housing companies with loans and

venture capital but also by offering grant programmes and advisory services

• IBB refinances itself on the money and capital markets (“AAA” by Fitch) and employs funds from

regional, national and EU public budgets

Berlin’s Public Regional Development Bank

Overview

2

IBB is major actor implementing EU structural

and innovation policy in Berlin

SME-FundLoans / mezzanine

72 Mio. EUR

VC Fund

Tech & CreativeRisk capital

50 Mio. EUR

Pro FITGrants / loans

175 Mio. EUR

InternationalisationGrants

10 Mio. EUR

Berlin Innovativ(InnovFin )

Loans

70 Mio. EUR

Cluster and

network structures

Grants

12 Mio. EUR

IBB manages

389 m EUR EU-

funding, provides

co-financing and

leverages multiple

private funding

3

IBB as pioneer of ERDF-FI among public banks

2014 – 2020

funding period

Pro FIT

SME-fund

VC-fund

2000 – 2006

funding period

2007 – 2013

funding period

∑ 419 m EUR

100 m EUR

144 m EUR

76 m EUR

∑ 216 m EUR

140 m EUR

28 m EUR

38 m EUR

∑ 66 m EUR

175 m EUR

4

SME-fund Berlin

SME-fund

Module Start-up

Berlin Start withguarantee up to

500 TEUR

Direct loans

up to 250 TEUR

Modul

Micro-credit

Modul Growth

Syndicated loansup to 10 m EUR

Direct loans up to

250 TEUR

Mezzanine loans

up to 5 m EUR

Module

Green credits

Berlin Kredit with

energy efficiency

windowup to 10 m EUR

Priority axis „investments and start-ups“ Priority axis reduction of CO2-emissions

Micro-credits /

IBB MikroCrowdup to 25 TEUR

➢ More than 3.500 SMEs from Berlin have been financed

with around 200 m EUR by the SME-Fund since 2005

5

How much?

Attractive interest rate irrespective

of credit rating

Fixed term of 6 years, up to 1 year

redemption free

Who? What?

Micro-credits from the SME-fund

Up to

€25,000

Businesses

Start-ups and

freelancers

SMEs

All sectors

Based in Berlin

+ Company acquisition

Investments

and working capital

Order prefinancing

Start-up costs

• IBB pioneer in developing micro-credits as part of public support schemes

• Long-standing experience, since 1999 ca. 3.000 micro-credits up to 25 TEUR

6

Simplified

application

Loan

meeting

Micro-credits – simplified procedure

Up to

€25,000

Business start-ups

Short processing time

• Lean, un-bureaucratic application process (no business plan or liquidity planning necessary)

• Fast financing decisions based on quick-check-tool, focus: personal interview, entrepreneurship

• No equity or collateral needed

0.0

2.0

4.0

6.0

8.0

10.0

Professional qualification

Business skills Industry rating

(Credit rating)Business planning

7

Micro-credits – breakdown

➢ 75 % Start-ups

➢ 55 % Businesses by women

➢ 19 % Businesses by people with a migrant background

➢ 1,5 % Defaults (share of loan volume) despite a cancellation rate of around 15 %

Retail20%

Manufacturing and business services

20%

Creative industries 12%

Tourism and catering9%

Energy7%

Other services7%

Transport6%

Health 5%

Others 14%

SectorsOthers

8

IBB MikroCrowd

https://www.startnext.com/pages/ibbmikrocrowd

9

About Startnext

• First German crowdfunding platform 2010

• Focus: Culture, Creative Industries, Food, Social Business

• Crowdfunding: Donation, Reward

• Starters from DACH region

• B-Corp-certified

10

(Reward-based) Crowdfunding Principles

11

Combination of microcredits and crowdfunding

• Start-up and innovation projects are tested in advance for their relevance on the market

• (Partial) financing through upfront revenues

• Marketing through dissemination via social media

Application Credit checkSignature loan

agreement

Combination

microcredit and

crowdfunding

Link (curation) on

partner page (IBB

MikroCrowd)

Create project

online

Advertise project

(market test)

Crowdfunding

successful

Loan disbursement

(max. 25k EUR)

Successfull

project / start-up

Funding payment

(min. 5k EUR)

12

IBB MikroCrowd

13

IBB MikroCrowd: example

• Powdy & Snatch (wb daily care GmbH) is 2nd winner of IBB-contest for social enterprises

• Powdy & Snatch offers innovative dental care for children without preservatives, without

artificially produced ingredients, with plastic-free packaging and would like to support sustainable

projects with part of the income

14

Irene Schucht

Head of Strategy & Products

Investitionsbank Berlin

Bundesallee 210

10719 Berlin

Tel: 030 2125-4730

E-Mail: irene.schucht@ibb.de

www.ibb.de

Thank you!

15

15

#ficompass

16