1 / 17

Institutional Framework and SME Access to Finance

Institutional Framework and SME Access to Finance. Prof. dr. Sophie manigart Vlerick business school and ghent university. Funding growth is crucial for the success of companies. Development Stage. Source: EY; Frontier Economics; EVCA. 2. Most active crowdfunding categories.

yon
Download Presentation

Institutional Framework and SME Access to Finance

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Institutional Framework and SME Access to Finance Prof. dr. Sophie manigart Vlerick business school andghentuniversity

  2. Funding growth is crucial for the success of companies Development Stage Source: EY; Frontier Economics; EVCA 2

  3. Most activecrowdfundingcategories

  4. Funds paid out per equitybased project

  5. Funding growth is crucial for the success of companies Development Stage Source: EY; Frontier Economics; EVCA 2

  6. The venture funding landscape in the uscountsmany different players in all stages

  7. US companies raise more VC funding US EU First round $ 7 mio € 3,2 mio Cumulative VC amount $21 mio €10,4 mio

  8. This leads tohighergrowth in US companies

  9. Vc in europe is threatened • Banks: Basel III regulation • Insurance companies: Solvency II regulation • National/regional public policy focuses on small funds, but big money is needed • Public policy invested30%-40% of new money in european VC funds between 2009-2012

  10. Belgium scores low on broadinstitutional factors (Stock market, M&A) Quality of education Source: Groh, Liechtenstein, Lieser, 2013

  11. A strong institutionalframework leads to more SME financing Supply of funding Demandforfunding One-share-one-vote Bankruptcyregulationandexecution Discharge available? Bankruptcyprocesscosts? Duration? • Legality index • Effectiveness of legal system, absence of corruption, risk of contract repudiation,… • Self-dealingprotection • Legal protection of minorityshareholders • Creditorrightsprotection

  12. Legal frameworkandsmefinancing in europe More equityraisedif… More debtraisedif… Strongerlegalityindex (+13%) Strongercreditorrights(+12%) Discharge afterbankruptcy (+79%) Quickerbankruptcyclosing, lowerclosingcosts • Strongerlegality index(+22%) • Betterprotectionagainstself-dealing (+79%)

  13. Position of belgiumcomparedto uk

  14. Conclusion • Improving the legal (and, more broadly, the institutional) environment for • Minorityshareholders • Creditors • Entrepreneurs wouldstronglyenhance the availability of fundingforSMEs • …at low costfor public policy!

  15. FUNDING

More Related