The Swiss Entrepreneurs Fund – What start-ups must know

07.02.2019 10:04

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When? What? How? The article provides the most important answers about the newly launched Swiss Entrepreneurs Fund.

How can start-ups get an investment?

The fund invests directly and indirectly via investing in third-party funds. About 20% of the total volume will be invested directly. This share can be higher as the fund plans in addition to invest directly alongside the selected third-party funds if the opportunity is attractive. With these co-investments the share of direct investments could increase to 35%. 

When will the fund start to invest?

SwissEF will start to invest after a first closing. At the moment the first closing is planned for the end of Q2 at the latest.

In which kind of companies will the fund invest?

The fund will only select companies in the growth phase. During the presentations of the fund start-ups such as Ava, Flyability or Sophia Genetics were named as examples. The companies must at least raise CHF5 million. The sweet spot is between CHF5 and CHF15 million. However, as the examples show the fund might also contribute to much larger rounds. 25 to 40% will not be invested in younger companies but in Small- and Mid-Market-Buyouts.

The direct investments will target three focus areas health, digitisation and engineering which includes for examples robotics or drones.

What exit strategy does a start-up need?

The time horizon for investments is five years. Companies must be able to realise an exit within this time frame.

How much companies will benefit from investments?

In total the money will flow via direct and indirect investments in 100 companies?

How much of the money will flow into Swiss companies?

50 – 66%

How will the fund make sure that third-party funds really invest in Swiss start-ups?

This will be handled on a case by case basis.

Which are the third-party funds that could be selected by the Swiss Entrepreneurs Fund?

In general it will be funds that are already active in Switzerland. However the fund plans also to contribute the development of the startup ecosystem by helping investment managers who were not active in the growth phase or by bringing investors from abroad to Switzerland.

To what extent will the fund work together with the Swiss Entrepreneurs Foundation?

Tasks of the foundation include helping start-ups to become investment ready for the fund and supporting portfolio companies with mentors, access to a network of entrepreneurs and tools for growth.  

Are there similar projects like the Swiss Entrepreneurs Fund? 

No. With its partners, the foundation and the combination of direct and indirect investments the fund is unique. However in recent months, about a dozen funds have been launched or are about to start. You can find an overview in the Swiss Venture Capital Report. 

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