Bilbao, 14 February 2014. In view of the rapid growth of alternative financing channels for SMEs, APD (Asociación para el Progreso de la Dirección) has held a seminar today in Bilbao with the participation of partners from Abra InvestThe aim is to discuss in depth the different existing alternatives and the keys to obtaining this funding. 

This meeting has once again highlighted how, in the business financing market in Spain, the banking sector has taken on excessive power, reaching 80% when in other countries its weight is around 30 or 40%. As a consequence of the excessive banking penetration of Spanish SMEs, new financing channels are emerging that favour the movement towards disintermediation of the financial market.

Diego Gutiérrez Zarza, Partner-Director of Abra Invest, told those present that SMEs, as an alternative to financial institutions, can turn to entities known as venture capital and venture capital. "Although they tend to believe that they only invest in large companies, in 2013, 74% of operations were oriented towards SMEs".

Despite the poor performance of Venture Capital (VC) and Venture Capital (VC) in recent years, Gutiérrez Zarza indicated that "expectations for 2014 and beyond are very positive. Venture Capital will have greater liquidity due to the support of Fond-ICO Global, which will inject 3,000 million in 3 years". To this he added that "in the last half of last year the amount invested has doubled compared to the first half, increasing in 2013 by 21% the divestments that will possibly provide greater liquidity to the funds".

In this line, it has been observed that venture capital now prefers expansion and early-stage projects, with a very significant decrease in acquisitions or buyout, mainly due to their link to bank financing. Venture capital has also invested almost 40% in the "Other services" and "Other industrial products" sectors, although technology companies are attracting investors, having doubled their presence from 2011 to 2012.

On the other hand, Gutiérrez commented that corporate investors are the main protagonists of corporate movements, growing by 29% in 2013, with very significant activity in the internet and technology sectors. In this way, they have filled the gap left by venture capital and have taken advantage of the possibility of their strategic contribution in investees to enter into good operations.

Business angels, for their part, are also playing a very important role in SME investment. According to the EBAN, European Association of Business Angels, invested 3 times more than venture capital in 2012, in fact it has indicated that "Spain has one of the best infrastructures of Business Angels networks".

In addition to these funding alternatives, the partners of the Abra Invest They also talked about direct lending, funds that directly finance SMEs with greater flexibility in terms and guarantees than a financial institution, and are usually funded by institutional investors. They also indicated that other movements favoured by technological advances are crowdfunding, oriented towards investment in technology start-ups such as Thecrowdangel, and crowdlending, which has begun to finance SMEs. Specifically, the pioneer in Spain of this model, www.comunitae.com has recently opened a line for discounting promissory notes for SMEs. The suitability of one alternative or another, as indicated to those present, will depend on the SME seeking financing.

Guillermo Ibeas, Partner of Abra Invest has told the entrepreneurs that "financial partners, sharing the same risks as the current shareholders of the SME, need to base their analysis on a good growth plan, a good professional team, good corporate governance and a good financial reporting methodology".

In short, they commented that the financial investor seeks maximum predictability of the company's future and therefore needs to reduce uncertainty or have the mechanisms to manage it. In family businesses, for example, the relationship between the family and the company must be very clear and, it is recommended that it be established in writing by means of a family protocol, and that the preparation and professionalism of the team should take precedence over whether or not they belong to the family.

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