FinFinder: pitch and match

Companies, especially many SMEs often struggle with, and lack the know-how of, how to finance large-scale digital projects. In many cases they can get connected to calls within the regional funding landscape. However, this can become a problem, as these options usually become time-consuming and have in most cases complex administrative requirements and processes. Moreover, most often than not, projects need to align themselves with the specific objectives of the funding call. Regional funding support mechanisms are therefore mainly used in the early stages of the development process when clear risk is involved. However, as a project progressess from PoC to a demostrator, companies will need to seek venture capital. In this latter case they should be prepared to join forces with an investor and tap into a strong network to help achieve their goals.

Sometimes companies also have low equity in relation to their financing needs or their turnover has been postponed due to the innovative nature of their product. The main risk of a lack of capital is that the company misses the go-to-market time window and the risk that competition enters the market first. Also, they could be in need of working capital to achieve rapid growth. Then they may be able to combine different forms of financing and look for alternative financing.

This good practice “FinFinder” helps them with the preparation to connect with external capital providers. "FinFinder" supports companies to get connected to a network of VCs. Through "FinFinder" companies have the opportunity to pitch their project or company to external capital providers. Via "FinFinder" they are supported in preparing their pitch for the VCs.

FinFinder – managed by Voka Chamber of Commerce (partner in EDIH DIGITALIS) and the Flemish Agency for Entrepreneurship and Innovation – helps companies to connect with external capital providers. The companies are supported in preparing pitch sessions with these organizations. This support is organized by specialists that help companies in e.g. focusing on the key messages, the length of the pitch, and potential pitfalls. The support is also focused on the "world of VCs" so that the SMEs get used to the "pitch language". Voka CoC also provides a pitch template and organises the networking events where the companies can present themselves to the venture capitalists. The financing needs of the companies are mapped before the match making sessions, these needs are tested against governmental rules and regulations.

Often star-ups apply for regional funding when their ideas and projects are in the starting phases, when they still need to further develop their solutions and a lot of risk is involved. As their projects progress, meaning their concept studies are successful and the solution is demonstrated, that is when, in general terms, private equity will be acquired to help the company in the industrialization phase, to put the product on the market and to assist in their growth.  

As an example of what a matchmaking event would look like we can look at “Dragons Den”, where entrepreneurs can pitch their case or company to venture capitalists willing to invest their own money. Companies and entrepreneurs and inspired to submit their case via an open invitation process, after which they enter a preselection process. Finally, the selected companies are then invited to pitch their cases or ideas. 

The elaboration and improvement of a new service, product or process is often hindered by the difficulties that investing money and time often bring. For most companies, these costs exceed initial expectations as they oftentimes miscalculate the costs of bringing a product to the market. On the other hand, beyond financial investment, an important detail is to be taken into consideration, the timing. Delays in bringing the product to market can result in lost market share and reduction of profit margins. It is therefore essential, that start-ups and scale-ups have timely access to funds in order to accelerate their development process. Taking all this into consideration, the Finfinder initiative helps companies address these challenges by giving them the opportunity to pitch their projects or ideas to external capital providers, improving their chances of receiving funding.

As for tangible results, the EDIH Digitalis Project, has already made significant impact. Only in the first 18 months of the initiative, 9 pitching events had been organized, with 58 companies participating. Based on the outcomes from these events, it is estimated that the total amount of capital raised as a result of the pitching sessions lies between € 2.0 million and € 2.5 million.

The success of the “FinFinder” initiative emphasizes the importance of these types of sessions in order to connect small business and potential investors, as some of these companies wouldn’t have been able to access capital providers otherwise. 

Two concrete examples, the Intopia case and the Heau case, showcase the impact of this initiative, giving that the companies were able to receive between 100,000 and 1 million euros. These examples demonstrate the effect this initiative can have on a company’s ability to compete and innovate.