EBAN recommendations related to Business Angels for the EU level

Presented by: Mr. Albert Colomer

Executive Committee Member of EBAN

Content

1. About EBAN

2. Business Angel market and trends

3. EBAN Recommendations for European Commission

About EBAN

EBAN is the European Trade Association for Business Angels, Seed funds and other Early Stage Market

Players.

EBAN is a non-profit association representing the interests of business angels, business angels networks

(BANs) and federation of networks, seed funds and other entities involved in bridging the equity gap in

Europe. More than 100 associated BAN’s , Federations & other players in 29 countries.

EBAN was established with the collaboration of the European Commission in 1999 by a group of pioneer

BANs in Europe and EURADA (European Association of Development Agencies).

What we do: Represent the early stage investment market in Europe Carry out research on the angel market and produce facts and trends (Since 2004, we publishes the

annual report of Angel activity in Europe &) Identify and share best practice ( EASY and Access ICT last European Projects) Promote the role and visibility of business angel networks and early stage funds in Europe (Since

2009, EBAN has been publishing the official BA Tax Break and Co-Investment Funds reports) Promote synergies and networking opportunities among actors in the industry Support the emergence of professional structures and quality standards across Europe Support the internationalization of the angel and early stage industry and movement (Helping several

countries to create Angel communities and also to implement BA Tax Breaks) .

More info in: www.eban.org

Created in 1999 by Eurada with the support of European Commission

+ 100 members (BANs, Federations…)…and growing

Members in 35 countries

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Not for profit organization based in Brussels

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About Eban

Business Angel market and trends

Business Angels are growing and are filling partially the financing gap of the early stage SME in Europe.

EBAN reported in 2012 that there where about 460 organized angel networks in Europe, compared to

around 50 in 1999. These 460 organizations gather some 20.000 angels.

Business angel finance is relatively untapped in Europe compared to the US, where the angel market is five

times larger. However business angel investment activity and performance is very difficult to monitor unless

they are tracked by being members of a recognized Business Angel Network, EBAN estimates:

Statistics Trend y-o-y (Europe) Europe USA

Number of networks 400 360

Of which commercial c. 20%

Estimated number of business angels

70k 320k

Total amount invested annually by angels (est.)

€ 3 - 4 bln $22.5 billion

VC investments in seed and start-up/early stage

circa € 1.6 bln $1.9 bn

EUROPEAN ANGEL MARKET= c. 21.9% OF US ANGEL MARKET

Source: EBAN Statistics compendium; NVCA Yearbook 2011; Center for Venture Research at the University of New Hampshire

Number of BANs in Europe

286297

data collectedSources: Direct stats from EBAN Members + Deals published by investors + Published information from credible sources

Amount Invested by BAs members of BANs (M€)

Amount Invested by BAs members of BANs (M€)… estimated to total BANs

508M€

427M€

Amount invested:Size of Visible/ Invisible Market

4.745 M€4.745 M€ 5.086 M€5.086 M€

427M€

509 M€

2011 2012

Visible Market9% 10%

Amount invested: size of market

€5,1 Bln€5,1 Bln

30%

€17,4 Bln

Number of BAs* in BANs

241.444241.444261.054261.054

2011 2012

“formal” market9%

10%

21.730 26.105

*BAs who made at least 1 investment in the past 3 years.

Angel investments in Europe

Michelson Diagnostics

Visible market by countryM€

Average investment amount by BANs(k€)

Average = 1,1M€

7100

Impact in the economy

Companies Financed

1.872(2.900)

Jobs Created

11.434(17.700)

Businesses funded/ BAs

Average = 0,158

For every 100 BAs 16 companies get funded

EBAN Recommendations for European Commission

According to different studies, and our presence in 29 countries in Europe, EBAN recommends to support a European Business Angel facility that has an order of magnitude of at least 400M€ to help the Member States to leverage their most valuable asset: the Business Angels knowledge and financial availability to back the new entrepreneurs:

1. Support investments by suitably experienced angel syndicate , BANs

and groups or individual BAs investing locally or specially cross border.

2. Raise awareness of angel investing in Europe and help creating

a professionalized eco system.

3. Facility some form of standardization across countries amongst

others trough the use of BA co-investment schemes and platforms

to enhance visibility on deal flow.

4. Support the best deals (demand-driven, no country quotas)

5. Commission more research on the European Angel Market

Co-investing Schemes/ with Angels

More BANs and multi country networks

Cross border investing/ EASY experience

Build companies with international growth potential

Study better the BA European market

EBAN Recommendations for European Commission

The European Commission should promote besides their Member States:

National public-private co-investment schemes

National policies for the financing of the new and

existing BA networks

Alternative investment class policy by introducing

tax breaks

Stimulate the activity of “Business angels” and

cross-border investments