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Belgium’s investment market amongst the best in Europe

Written by DS on in the category Insights with the tags , .


Investing in biotech requires big money; several financing rounds are necessary to allow a company to fully develop itself. Early stage financing is more risky than investing in more mature companies, but indispensable to create growth. In this article we give a brief overview of the Belgian investment market and explain why it attracts foreign investors. 

The Belgian Life Sciences Funds

The financial crisis in 2008 induced an impoverishment of life sciences investment funds. For example, KBC was an important investor, but they quit their private equity activities for young starting companies. However next to some established funds, there are quite some new very active and upcoming funds in the life sciences sector in Belgium:

  • GIMV  an important pioneer to grow biotech in Flanders
  • PMV became especially active during the last couple of years. They have a dedicated life sciences team, but also invest in other fields.
  • Vesalius biocapital has a focus on therapeutics, medical devices and diagnostics
  • Capricorn invests in human health-technology relating to the prevention, the diagnosis and the treatment of diseases.
  • BioVest is the fund of Rudi Mariën, a life science investor with more than 30 years experience
  • University-linked seed funds such as QBIC to invest in biotech spin-offs from Universities of Ghent, Brussels and Antwerp, the Gemma Frisius Fonds for KU Leuven spin-offs, Theodorus for ULB spin-offs and Vives for spin-offs of the UCL
  • Fund+, founded by Desiré Collen, provides equity for life sciences companies with a primary focus on therapeutics and diagnostics in an advanced development stage
  • LRM invests in biotech companies with a link to the Province of Limburg
  • SRIW, a key investor at the heart of the economy of Wallonia
  • TOLEFI SA is a Belgian family holding company 100% owned by Mr. Serge Goblet and his wife Isabelle Thoumyre. One of its main focuses is on biotech investments.
  • Nivelinvest, investor of risk capital in Walloon Brabant
  • Investsud, one of its main focuses is to invest in Luxembourg (bio-)technological spin-offs
  • SFPI-FPIM, the federal holding and investment company
  • V-Bio Ventures, co-founded by VIB in 2015, this fund focuses on early stage investments.

Did we miss an investment fund - despite carefull review by experts? Get in touch, and we will adjust the article! 

Belgium forms a solid basis for life sciences companies

In Belgium, several funds are available for early-stage financing and young companies can also count on governmental support from IWT (Flanders), Innoviris (Brussels) and DGO6 (Wallonia). These initiatives bridge the financial gap between early stage and more mature companies. This attracts foreign investors, as the local funding partially reduces the early-stage investment risk. Johan Cardoen (managing director, VIB) comments: “Anglo-Saxon funds used to invest a lot in Belgium, but they redirected their focus to the US. Nevertheless, Belgium is a good country for startups here in Western Europe. Dutch (such as LSP, Forbion, Gilde) and French funds (such as Sofinnova, RothShild, Seventure, Auriga partners and Kurma) actively scout for investment opportunities here in Belgium. Germany for example, misses out on these opportunities, as their local venture capital for young companies is too poorly developed.”  Foreign investors do not often fund early-stage projects. “This is true,” replies Cardoen, “but things are changing. This year, the lead investors in two VIB spin-offs were foreign venture capital funds.”

“Foreign biotech companies, especially from Southern Europe are actively looking to be based in Belgium,” adds Cardoen. “This proves that Belgium’s biotech climate performs well. They benefit from the startup funds, the abundant talent and knowledge centers, and the availability of an advanced biotech cluster.”

Funds should also be seen as partners, they bring in useful expertise

 
The US operates in a different dimension

In 2014, the US counted over 120 IPOs. Many funds made a lot of money, which they now reinvest in new startups. “US companies generally raise twice the amount of money compared to European companies during an investment round. They also have a higher frequency of capital increases; companies grow faster in the US. However, it does make me wonder whether these high valuations are justified,” explains Cardoen. “Companies in Europe grow more gradually, but we also have attractive stock exchanges, like EuroNext. More mature companies can benefit from this public equity on the long term.”

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