Nordea Bank : to support angel investing in the Nordics

01-12-17 13:40 | About Nordea

Nordea and Nordic Business Angel Network (NordicBAN) have signed a partnership agreement.

A flexible loan model for angel-backed startups

Nordea Startup & Growth takes care of the customer relationships in the start-up and growth customer market. It also cooperates closely with VC Funds, business angels and accelerators.

Nordea has been actively funding start-ups during the low business cycle. In Finland Nordea Startup & Growth has 2,600 customers, of which 1,300 have a loan solution in place. We currently have a start-up loan solution balance of EUR 250 million. In 2016 it was at EUR 150 million and in 2015 EUR 90 million. A typical early stage start-up loan amounts to EUR 100,000, whereas a typical growth/scaleup loan solution is in the EUR 2-10 million range. During 2017 we have provided over EUR 100 million of EIF guaranteed growth loans in Finland.

'Nordea has developed a very flexible loan model for start-ups, which includes the active role of private investors. Our role in cooperating with private investors has become very important for the ecosystem. Based on several years of experience in Finland, we are ramping up a similar setup in all Nordic countries,' says Magnus Montan, Head of Commercial and Business Banking at Nordea.

'We even have a deal flow manager in our team who has a Nordic role to go through Nordea's deal flow with top VCs, angels and corporate venture arms in order to help them find new portfolio companies effectively,' says Vesa Riihimäki, Head of Startup & Growth FI at Nordea.

Introduction of Nordic angel activity and future potential

The Nordic and Baltic business angel ecosystem has developed very positively during the last years and there are over 20 visible angel networks inspiring local startup investors. These so-called 'New Nordics' cover approximately 1,800 visible business angels investing a total of more than EUR 100 million a year. The majority of Nordic angels invest in groups, with a group investment averaging EUR 200,000.

There is an increased interest in finding potential co-investors in a wider region and increasing the average size of group investments. To support this interest the Nordic Business Angel Network (NordicBAN) started its activity in autumn 2017, driven by active business angels. The mission is to actively connect and introduce business angels on the Nordic level and match syndication-ready startups with an active lead investor. The Nordic region has a great potential in building a tight co-investment ecosystem, as done by the Nordic start-up movement #NordicMade.

'On the Nordic level we already see great cross-border co-investment activity among angels that know each other well. There are fewer technical challenges hindering the investment decision and therefore the focus should be on matching great investor profiles,' says NordicBAN's Managing Director Claes Mikko Nilsen.

Next steps - Recognised need of financing supporting investments on the scale of EUR 200,000 to 1 million

'Nordea's model of offering start-ups flexible loans that are backed by business angels has gathered wide interest on the Nordic level. NordicBAN and Nordea's partnership will focus on sharing best practices in startup investing and valuable services supporting cross-border investing,' says NordicBAN's Managing Director Claes Mikko Nilsen.

'Nordea is developing Startup & Growth units on the Nordic level which aims to actively support the development of a local angel ecosystem,' says Magnus Montan of Nordea.

Due to our relatively long experience in the startup field and the fact that we currently have 1,300 startups with a loan solution in Finland alone gives us a strong base to recommend great companies that we strongly believe in to Nordic angel syndicates,' says Vesa Riihimäki of Nordea.

The common goal is to see tens of syndicated investments take place in the first year alone. These angel syndicates benefit from the leverage Nordea can provide, and Nordea is extremely interested in taking part and helping the top startups succeed in the Nordic market.

For further information

Claes Mikko Nilsen, NordicBAN, [phone]

Vesa Riihimäki, Nordea, [phone]

Hans-Erik Lind, Nordea, [phone]