CEC platform is a very useful networking 'tool' between entrepreneurs, investors, and business and policy leaders. It provides many advantages as a matching platform between informal investors and entrepreneurs seeking start-up money. CEC local 'Hubs' support regional networks aiming to secure expertise and equity for early stage companies.
CEC acts as a facilitator between technology business and investors through a comprehensive program of events helping companies become investor-ready and to meet potential investors. These events organized by CEC are:
Financing Eco Innovation
An investment readiness event/ partner project;
Eco Commerce Platform
A platform for enterprises seeking investors and investors sourcing opportunities;
Eco Commerce Summit
An annual stakeholder conference;
Knowledge and Skill building
Workshops, briefings, training programs, and meetings.
Non-Financial Support
The sustainability of a SME is higher if the funding is provided with support services. The CEC was built around local hands-on Advisory Programs and Soft Landing Services, which allow entrepreneurs to get access to accredited business coaches, including business angels. Among these services, CEC delivers:
- Coaching, mentoring and training;
- Space in incubator;
- Services aiming at improving the management capability of the entrepreneurs;
- Clustering and networking.
Entrepreneurs can also benefit from advisory services before the financial support is provided. These services are:
- Investment readiness partner projects;
- Support to fill in the paper requested to access the funding.
Scope of the Public Interventions
The scope for public interventions lays both at the supply side (provision of finance) and at the demand side (increase the quality of the business plan or reduce the risk to be taken by investors).
The public sector can help solve market failures by helping the demand to match the offer through networking activities.
Different types of market failures occur in the field of access to finance by SMEs and start-ups. Those market failures can be:
- Information failures: due to the fact that the market might be fragmented.
- Insufficient infrastructures: due to the fact that some tools do not exist for instance: business angels networks, investment readiness schemes, seed capital funds...
- Inefficient functioning of markets: due to the lack of competition, no exit opportunities for early stage investors, permanent assisted mentality of entrepreneurs used to receiving grants instead of seeking equity...
- Limited interaction between actors due to a lack of an integrated approach, the existence of a value chain or a lack of governance.
- Institutional mismatch between the infrastructure and the market needs due to lack of understanding by the public sector of the real needs of enterprises and the market failures.
- Missing demanding customers due to cultural problems as well as good perception of investors expectations.
- Government failure: due to a lack of coordination and focus on a component of the value chain or on the improvement of the market.
- Equity gaps.
- Insufficient number of private investors.
- Lack of risk-taking.
- Bad framework conditions (legal, administrative, fiscal, environmental).
- Bureaucracy practices.
- Lack of public-private partnership.
Improving the Demand Side
Public policy should invest in schemes allowing entrepreneurs to become investment ready, this can take different forms, such as:
- Support to enterprises wishing to improve their business plan and to build an integrated marketing communications plan in order to improve access to finance;
- Business plan competition;
- Financial intermediation;
- Investment readiness schemes;
- Support the cost of hands-on management systems and the due diligence costs;
- Reviewing blockages in distribution channels to specific entrepreneurs: disadvantaged groups or communities;
- Support the costs of public rating systems both on the point of view of bank or technology risk in favor of SMEs.
Improving the Supply Side
Public authorities can add value in the value chain of access to finance for SMEs. The support can take the form of:
- Fiscal incentives aiming at improving the environment for business angels and individuals investing either in innovative enterprises or in non-quoted enterprises;
- Soft measures such as reducing the costs of financial investors to do the due diligence or support for the recruitment of financial advisors by intermediary organizations;
- Stake in funds. Public authorities can contribute to the creation or the sustainability of specific funds responding to regional market failure;
- Clustering the main stakeholders in order to organize or strengthen a regional value chain;
- Providing guarantees or grants to reduce the level of risk taken by investors.
