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Commercial bank RBI and private equity specialist C-Quadrat created the Austrian Growth Capital Fund venture capital fund. Which companies are eligible to participate and which investors should still join.
Medium-sized companies are among the most important drivers of innovation in the Austrian economy. About half of the national investments come from companies of this size. Financing is generally done through banks. National venture capital, on the other hand, is an exception. Financing for growth and acquisitions is often scarce. And this despite the fact that midsize companies invest heavily in research and development and, despite a small selection of financing options, they have become world leaders in innovation in their field.
Hardly any private equity with local presence in Vienna
Alex Schütz, CEO of C-Quadrat: “There are hardly any private equity investors with a local presence in Vienna and there is a lack of professional capital with which to achieve high returns, especially in times of economic boom.” That should change now.
Building block to strengthen SMEs
Therefore, commercial bank RBI and project partner and private equity specialist C-Quadrat have jointly launched the Austrian Growth Capital Fund. “We want to create a powerful private equity fund for Austrian SMEs and thus contribute to closing the capital requirements of high-growth SMEs,” said RBI CEO Johann Strobl.
RBI as an anchor investor, other institutional investors are welcome
Up to € 200 million will be raised for the fund. Investments must be made in equity instruments and the like. RBI acts as an anchor investor and, together with C-Quadrat and Kathrein Privatbank, advertises other institutional investors such as banks, insurance companies, foundations, family offices and state investors.
C-Quadrat guarantees independent management
“In times of low interest rates, we offer investors the rare opportunity to benefit directly from the innovative strength of Austrian SMEs. At the same time, we allow investors to participate in the economic recovery expected in the coming years through their investments. We are very happy to have won C-Quadrat as manager of the Austrian Growth Capital Fund. C-Quadrat guarantees the independence of fund management and has a team with an excellent track record in the private equity business of SMEs ”, explains Valerie Brunner, Director of Institutional Clients at RBI.
What companies should have
The focus of the Austrian Growth Capital Fund’s investments is in minority and, in selected cases, majority holdings in high-growth companies and SMEs in Austria and those with a strong connection to Austria. Companies must have a strong position against long-term competition, offer clear opportunities for growth and value appreciation, and comply with ESG criteria.
In the upstream phase, more and more capital is sought for growth and digitization.
“The Austrian SME landscape offers a large number of interesting potential investment firms and we expect that in the post-COVID rebound, there will be more demand for capital for growth and digitization and that business succession will reorganize,” he explains Cristóbal Méndez de Vigo, CEO of the Group. of the C-Quadrat Investment Group. Skepticism towards venture capitalists, widespread in Austria a few years ago, has clearly diminished in Vigo’s view. “The success of our team helps convince entrepreneurs seeking growth capital of the advantages of a partnership,” adds the manager of C-Quadrat.
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