Finance Board, the first of its kind in Finland, brought together entrepreneurs and a host of financiers to share best practices in securing funds for internationalization. Widely thanked by the participants, the afternoon of March 10 featured several keynote speeches and a reverse pitching section with 15 pitches by venture capital companies and other finance providers.
Finance Board was organized by Boardman2020 and Takeoff Partners in cooperation, following the successful Growth Board that was organized in November 2015. As international growth always consumes resources, the focus this time was on funding the desired growth, as the name suggests.
Treat financing like a sales process
The afternoon’s program got a flying start
with Micke Paqvalen’s insightful presentation about best practices in seeking
finance. Paqvalen is the CEO and co-founder of Kiosked, the leading independent
advertising automation platform company for native, in-view digital advertising
that has grown into a 16,7MEUR business in 2015 and aims to maintain its rapid pace
One of the main points Paqvalen brought across
was the similarity of the financing process to a sales process. Engagement,
referrals, personal connections and relevant conversations are key, and this is
why the CRO and CFO need to continuously be on top of the financing process. Paqvalen
also emphasized the role of positioning: Trust is everything, and the team
seeking finance should also do their homework with regards to their key
differentiators in the market. Ideally, there should build a competitive
bidding process going on, with “10 other options” existing.
And just like in sales, Always Be Closing (ABC): It’s not done until you
have the money on your bank account!
It’s more art than science
Open Ocean Capital’s Partner Tom Henriksson highlighted
in his presentation the various aspects they consider in a company that is
seeking finance; Market, Team, Solution, and Traction. While these are
straightforward, what always complicates things somewhat are the less obvious
things such as timing, referrals, personal preferences and other things that
make investing more of an art than pure science.
That there is a global market for the proposed product or solution is
naturally a starting point for any meaningful financing negotiations. Hand in
hand with the importance of the market potential goes the team: Is the team of
the caliber that it can actually capture the market opportunity that it has
identified? What about the solution then: Is it global-proof and scalable?
Finally, traction of course is the best indication that customers not only have
purchased the solution but are also willing to advocate it and to participate
in developing it further. Ideally, there should already be paying customers
outside of the home country to provide evidence of the international viability
of the product.
Clean technology to China: Case GreenStream Networks
Jussi Nykänen, CEO of GreenStream Networks
discussed in his keynote presentation the China-specific challenges that GreenStream
Networks has encountered. Some of their lessons learned include:
- Getting growth financing requires
a lot of work. Closing a complex financing package takes time especially when
the chosen business sector is less traditional and hence less well known.
- The growth opportunity in
the Chinese energy efficiency markets is huge, yet the capability to move fast
is a must. The financing structures will need to enable this.
- The Chinese markets are ever-changing, and as a consequence the business
concept may need to be recreated several times. Being able to manage the
transformations is a major challenge for the team.
Reverse pitching powered by Arctic Startup
One of the interesting highlights of the
afternoon’s program was a reverse pitching event, organized in cooperation with
Arctic Startup. The idea of reverse pitching is that financiers present their
own experience references and networks to startup entrepreneurs seeking finance.
Among the pitchers were 15 financiers, both private and state-owned:
Open Ocean Capital
IPR.VC Management Oy
On behalf of all VIGO
accelerators: Marit Tuominen, FINAC ry/ Vigo-kiihdyttämöt
On behalf of Family Offices: Harry Brade (Lamy Oy) and Mikko Leino (M1
Case RELEX: Raising 20MEUR of growth finance
The afternoon was closed off with a final
keynote case presentation by CFO Johan Haataja from RELEX Systems, provider of
comprehensive solutions for supply chain management and optimization. RELEX
managed to secure a 20 MEUR minority financing round from Summit Partners in
Haataja summarized Relex’ key success factors
#1 Evidence of strong
growth – even better if profitable and cash flow positive
#2 Evidence of satisfied
customers and customer value
#3 Evidence of
#4 Evidence of 1+ B€
And to achieve the above
you also need:
#5 A talented, motivated,
happy and committed team rowing steadily towards a shared vision
The RELEX team charges ahead with a team of
200 in 9 different countries – and a solid financing for further accelerating its
international growth.Thank you once again to all presenters and participants for making
Finance Board a success!