Raising capital abroad is one of the new opportunities opened up by the European Crowdfunding Regulation, which will officially become operational in Italy from November 2023.
The entrepreneurial culture in different European countries may be different, so you need to learn more about where you want to go to find investors, but some elements are universal.
To present yourself properly and attractively to foreign investors, you need to bring meaningful material that highlights all the most important aspects of the company in an effective and fluid way:
– in which market it is placed
– what is the business model
– how the team is composed
– what stage of development is it in
– a pitch with a concrete call to action (i.e., how much money do you need, to do what with it, and what do you offer investors in return).
Even embryonic companies must prove in some way the validation of what they do, prove that there is someone willing to buy that product or service.
A practice is widespread abroad that has not yet taken hold in Italy: creating an SPV (Special Purpose Vehicle) to raise capital, i.e., an empty company aimed only at acquiring investors’ capital and then appearing as a single investor for the original company. This strategy is important because it gathers the many, small crowd investor into a separate company structure, leaving the main company’s with its founders free and clear. The company thus remains attractive to larger investors such as venture capitalists, who prefer to enter companies where they can have broad decision-making power and discuss directly with the (few) founding partners. That is, too direct involvement of smaller investors is avoided.
In Italy this process can be very complex and expensive, so it is not very common. However, one can include in the terms and conditions of the investment contract the future creation of an SPV where crowd investors will be channeled. A viable alternative today is to open an SPV abroad, where it is less expensive, to raise capital for an Italian company.
Seedblink is a “co-investment platform” that combines crowdfunding with the world of professional investors. It uses agreements with professional investors (venture capital, business angels, etc.) as the basis for crowdfunding campaigns: a campaign that already has professional investors on board has greater validation in the eyes of potential crowd investors and makes it easier to attract them.
Italy’s entrepreneurial fabric is mainly composed of small companies, often family-owned and operating in non-tech fields. Investors, especially professional ones, often focus on tech companies, but it is also possible for small businesses to raise capital abroad, with the proper approach involving careful study of the fields of interest of various investors so as to target the right players.
We discuss this in our first webinar in English with an international guest from Seedblink.
TOPICS
0:00 Introduction
5:40 How to best present yourself abroad to find investors
11:30 Seedblink opportunities to raise capital
14:00 The reward approach to reduce investor risk and attract stakeholders
17:30 Why create an SPV (Special Purpose Vehicle) to raise capital
23:30 Raising capital in Italy through a foreign SPV: the new opportunities of the European Crowdfunding Regulation
27:00 What Seedblink does as a “co-investment platform”: integrate professional investors into the crowd
34:15 Can small Italian non-high-tech companies raise capital abroad?
39:16 Differences between pre-seed and seed stages from the perspective of raising capital
SPEAKERS
Claudio Grimoldi, Turbo Crowd Founder
Robbin Hoogstraten, Seedblink Regional Manager Benelux
