vestr closed an oversubscribed Series A round led by Six Group

Our portfolio company vestrwhich provides issuers of Actively Managed Certificates (AMCs) fast, flexible, and cost-efficient alternative to investment funds, has closed its Series A led by SIX Group. However, the amount invested has not been shared publicly.

The SIX Group, operator of the Swiss Exchange, led a group of professional investors, including EquityPitcher Ventures, Zuercher Kantonalbank, and the European Angels Fund, a sub-fund of the European Investment Fund (EIF). EquityPitcher Ventures and SIX have previously invested in vestr in 2018.

The funding will be used to further develop the platform, onboard additional issuers, and become the de-facto market standard for AMC issuers.

Stefan Wagner, Head of Business Development at vestr said,

"Bank Julius Baer is an early adaptor of the vestr platform."

Mehr zu vestr finden Sie hier.

Corona crisis and the change in value chains

Especially in times of crisis, the waves crash over a start-up. Questions of financing security, own liquidity, but also manifold are the entrepreneurial challenges of the customer market. However, changes often do not only occur on the customer side. Rather, the current pandemic crisis teaches us how vulnerable international supply chains are today. Continuous, reliable sourcing chains with trustworthy partners are immanent for a start-up and guarantee speed for market entry.

Global sourcing chains can be interrupted

The internationalisation of trade flows with the procurement of components, raw materials and technologies is standard practice today in our world of division of labour. Likewise, employees with specific skills are engaged abroad and their results from research and development flow into products and services at the company's location. The current crisis situation now makes us aware of the vulnerability of these global sourcing chains. Be it the unavailable parts due to ordered plant closures, or an export ban by sovereign decree, as well as the simple logistics interruption in the transport routes. For a start-up, such restrictions can be serious and lead to existential distortions.

Risk management and political changes get a price tag

As part of annual risk management, a company and in particular its strategic bodies have the opportunity to assess existing and potential risks with regard to the probability of their occurrence and possible extent. Now, as a result of the findings of the Corona crisis, the risks associated with the interruption of the company's own supply chain have been added. Since political instability will continue to increase in some countries, the dangers of logistical disruptions become obvious. Monopolistic dependence on individual suppliers is potentially dangerous and existential. Furthermore, these risks are given a relevant price tag in audits and, especially in the case of start-ups, financiers are likely to demand a realistic and serious assessment of the current situation even more in the future.

Trusting, intact value chains result in speed to market

Value chains form the basis for a healthy and stable economy with an intact labour market and are regularly mapped in so-called clusters. Starting with education and research, via suppliers and regulation, through to producers and service providers at the end customer and on to downstream specialised services - all players are important and lead innovations to the market. The trust among the partners along these links enables successful cooperation. It is also a guarantee for speed in innovation. And how often, especially in our dynamic world, it is not only the differences in products and services on the market that are decisive. The winner is often the provider who is first on the market and can thus secure a data advantage. Regional ecosystems with successful clusters offer an ideal breeding ground for start-ups due to technological and personnel overlaps between the value chains. The knowledge gained in one environment flows into other areas and opportunities arise for new, innovative companies. Knowledge about social changes, general market trends and disruptive products or service developments are part of the foundation of an economy with intact clusters, which knows its opportunities but never neglects the risks.

Bruno Sauter

How venture capital can counteract the gender gap in entrepreneurship

The gender gap plays a major role in the field of start-ups and innovative companies. It can still be observed that women founders are not only an exception, but generally encounter more barriers in the search for investment capital[1]. In addition to the more restricted access to capital, there are other factors that lead to a gender gap in society, which are not addressed in detail below. The focus of this article is to identify measures that capital providers and investors can take to counteract the gender gap in entrepreneurship.

Diversity remains too weakly perceived

New and innovative ideas are primarily generated when problems can no longer be solved in the conventional way. The more flexible and thus the more diverse the approaches are, the easier it is to find a suitable solution. For this reason, companies with gender diversity in their teams are generally noticeably more successful and above all more flexible[2]. This is also revealed in a study by the Boston Consulting Group (BCG)[3]which states that the global market economy would increase by 3 - 6 percent if women were to become entrepreneurs to the same extent as men.

The gender gap is shrinking - but not everywhere

There is very clear evidence worldwide that the gender gap in entrepreneurship is tending to narrow and has been sustainably reduced in recent years and decades. Figures from 2019 show that female founders were able to raise an average of $1.2 million in the seed phase, while male founders usually raised $1.35 million[4]. At first glance, the difference does not appear to be very great, but these figures can only be qualified in part. These figures say nothing about the number of start-ups and above all about the number of successful implementations. Above all, however, it is clear that America is again very different from the German-speaking countries in Europe[5]. In Switzerland in particular, it has been recorded that not only is there a gender gap in entrepreneurship, but that it is even growing in some areas[6].

Why women entrepreneurs have a hard time

When it comes to setting up a company and, above all, raising the necessary start-up capital, women have a much harder time than their male counterparts. This is shown, among other things, by a study from the USA, which compared how a pitch is perceived by different genders. The study showed that when pitching the same business idea, men are around 60 percent more likely to[7] were more successful than women. And this was not because the men and women argued differently, but mainly because of the perception of the other person. It still seems to be the case that women are assumed to have considerably fewer competences in the fields of technology and business. There is thus a deeply rooted defensive attitude on the part of the mostly male donors to evaluate an idea equally among women and men. In order to overcome this problem, we believe that a change is needed, especially on the part of venture capital investors.

How capital providers and investors can counteract the gender gap in entrepreneurship

1. Shift in the mindset
Often it is our own preconceived and unsupported opinions that guide our actions. You can only counteract these opinions with hard facts. It is not easy to free yourself from your own prejudices. However, many studies now show that diversified teams are more powerful, more resilient and more efficient than teams of a homogenous gender. If investors are aware of this fact and believe the studies and their results, the chances of a lasting profit are significantly higher with mixed teams. Those who look beyond their own horizons and focus primarily on the bare facts usually quickly change their own view of the world and thus their own behaviour.

2. Change your own corporate culture
This measure is closely linked to the first point. An investor who acknowledges that the performance of mixed teams is significantly better should also question his own corporate structure. If VCs want to honestly oppose the gender gap, they should also ensure diversity in their own company. And not on the basis of a quota prescribed by law, but on the basis of performance and quality. Quotas usually cause injustice and can make open exchange at eye level impossible.

An investor identifies with entrepreneurs who have a similar background, interests or background. This statement is also confirmed by research on the gender gap in entrepreneurship[8]. It can therefore be concluded that gender diversification among investors counteracts the gender gap in entrepreneurship.

3. Create, support and use networks
VCs, but also companies and social organisations should build networks and enable an exchange of experience. By connecting with successful female and male founders, exchanging ideas and, above all, critically examining them, female founders should be supported in building up a business. It is often the case that established networks do not offer any access for women, or access is more difficult[9]such as the Zürcher Zunft, student fraternities or even the Basel Fasnacht. Networks should open up so that sectors are not kept gender homogeneous and the above-mentioned identification points can take place. Investors and VCs are therefore more in demand than ever to set up new structures and create new opportunities.

Conclusion
Our proposed solution to counteract the gender gap should not be forced by law, but rather through a general social change in thinking. VCs should question whether fair and parity conditions really prevail or whether ideas of women are generally considered more disparaging than the ideas of male founders. Equality and equal rights always begin in the mind with one's own attitude. Only those who treat all genders equally can learn to judge the idea itself.

Autorin: Andrea Buhofer

Literatur

[1] https://www.ft.com/content/e5341062-4eb8-11e8-ac41-759eee1efb74

[2] https://hbr.org/2019/02/research-when-gender-diversity-makes-firms-more-productive

[3] https://www.bcg.com/en-ch/publications/2019/boost-global-economy-5-trillion-dollar-support-women-entrepreneurs.aspx

[4] http://about.crunchbase.com/wp-content/uploads/2020/03/Funding-To-Female-Founders_Report.pdf

[5] https://www.forbes.com/sites/ninaangelovska/2019/05/12/europe-we-have-a-problem-8-facts-about-female-entrepreneurs-in-the-digital-age/#78cb317c4d42

[6] https://www.bcg.com/en-ch/publications/2019/boost-global-economy-5-trillion-dollar-support-women-entrepreneurs.aspx

[7] https://www.weforum.org/agenda/2017/10/five-ways-policy-could-close-the-gender-gap-in-entrepreneurship/ and https://op.europa.eu/en/publication-detail/-/publication/84bd6dea-2351-11e8-ac73-01aa75ed71a1/language-en

[8] Greenberg and Mollick, 2017, pg. 343

[9] https://rotary.de/gesellschaft/frauen-bei-rotary-ja-aber-a-13665.html

Why the promotion of the start-up ecosystem does not stand still at EquityPitcher and in Switzerland despite COVID-19

Young entrepreneurs in particular are feeling the effects of the now worldwide economic crisis caused by COVID-19. Start-ups, which often have low liquidity, can quickly face financial bottlenecks due to declining sales. Depending on the industry, many start-ups are facing great challenges and are therefore more than ever dependent on additional financial resources from investors or loans. According to a survey by Venturelab 3% of the 660 surveyed start-ups in an existential danger and are uncertain whether they will survive this crisis.

In such times of uncertainty it would be a natural and understandable reaction as an investor to reduce investments and wait and see. The risk and the uncertainty whether the start-up will get through the crisis and can nevertheless be successful is too great.

However, we at EquityPitcher do not adopt this way of thinking for various reasons. We are convinced that especially during this crisis the start-ups are dependent on our support. Likewise, previously innovative and successful start-ups should not have to stop generating value in society because of the pandemic, which would be a loss for all of us. For this reason, we have not put a stop to investments and attach great importance to actively accompanying our portfolio through these difficult times.

However, it is important to distinguish between companies that have only experienced financial difficulties as a result of the pandemic and those that were already in difficulties before the pandemic. For the latter, this crisis should be an occasion to address the problems that have usually already existed for some time, which have become even more obvious due to the increasing pressure of the pandemic, and to work together on them. As these companies would most likely have run into a liquidity bottleneck in the future even without COVID-19, support in the sense of a purely social assistance service towards investors is not justifiable.

At this point in time, we note that a large part of the companies from our Portfolio has mastered the current situation very well and is developing well despite the crisis. Due to their already existing dynamic and agile way of working, the start-ups can react quickly to changes in the outside world. It is admirable how many of our portfolio companies are taking concrete measures and in some cases adapting their business units. In this way, the companies can contain the negative effects of the pandemic.

From an overall portfolio perspective, we therefore feel confirmed that a diversifizierte Investitionsstrategie is the right approach to ensure that a portfolio can continue to perform through a crisis. The near future will show what new possibilities and opportunities will open up for us, especially in the healthcare, media and telecommunications sectors, but also in the entire field of digitalization.

The Swiss government is also increasingly recognising the importance of young companies and will offer supplementary support for innovative start-ups from May 2020. The previous bridging loans have provided little relief for start-ups, which is why the federal government is now joining forces with the cantons to provide loans of up to 154 Millionen Swiss francs vouched for. This measure is to be warmly welcomed and shows that the Swiss government is not ignoring the importance of the start-up ecosystem and that Switzerland will continue to be promoted as a location for innovation.

The combination of the proactive, forward-looking start-ups with their dynamic and agile structure, coupled with government assistance and our support as a VC allows us to look forward to a thoroughly positive future. If many start-ups survive this crisis with the help of the government and their investors, Switzerland's start-up ecosystem will continue to grow in the long term and provide for innovation, value creation and prosperity.

Review of the year 2019

Today we look back on an exciting, labour-intensive and above all successful year 2019. We would like to take this opportunity to thank you, dear founders, investors, advisors and partners, for the trust you have placed in us and for the valuable cooperation. Your support has made a significant contribution to our further development as a venture capital company. In the following you will find an overview of the highlights that have shaped our year 2019. This certainly includes our annual "EquityPitcher Come Together", which was again a great event in 2019 with over 100 participants. One of the most important highlights was certainly the launch of our second fund, through which the first investments were already made. In the course of the year we also established and promoted further valuable relationships with important institutions and co-investors, with whom we were able to further enhance our standing in the market.

Highlights Portfolio Startups

RightNow, was able to celebrate the establishment of new verticals, the acquisition of a start-up company and the conclusion of another successful financing round. The new shareholders now include the founders of the travel platform Trivago. Futurae benefits from the new PSD2 regulation and was able to convince several well-known customers of its products. In addition, Sandra Tobler was voted one of the most successful female entrepreneurs in Switzerland by the Handelszeitung. ROOMZ closed another financing round and is now expanding as the Swiss market leader throughout Europe. Xatena was able to multiply its transaction volume from approximately CHF 8 million to over CHF 60 million in 2019 alone. Cormo has ventured into the USA through a joint venture. At the same time, the state of Indiana has promised subsidies of 30 million USD for Cormo USA. vestr hat mit Julius Bär einen grossen Ankerkunden gewinnen können. YukkaLab hat es geschafft, der erste Partner der neuen avaloq Plattform zu werden. Nach anfänglichen Sales Schwierigkeiten im Jahr 2019 konnten iLocator and Navus both successfully adapted their business model in order to further accelerate their growth.

We are very proud of the fact that ALL our portfolio companies - which contradicts all existing statistics - have developed positively! A further statement is that these 10 portfolio companies have received a total of more than CHF 27 million in fresh capital since the beginning of 2018, which gives an additional boost to the growth of each individual company.

First successes with new portfolio companies

OnlineDoctor
The leading Swiss teledermatology provider from St. Gallen was able to raise CHF 2 million in fresh capital in 2019. The greatest success is certainly the subsequent successful expansion into Germany. Thanks to an exclusive partnership agreement with the Professional Association of German Dermatologists, more than 150 new dermatologists were attracted to the OnlineDoctor platform just a few weeks after market entry!

AirConsole
The first gaming start-up in our portfolio successfully completed a CHF 3 million financing round. Co-investors include Ringier Digital Ventures, Alpana Ventures, Swiss Founders Fund and Wingman Ventures. AirConsole is making great progress in the B2B area and focuses on the implementation in TV boxes (e.g. partnership with Swisscom).

Guuru
Customer service by customers is the motto at Guuru, which received CHF 2.7 million in fresh capital in 2019. EquityPitcher is a joint venture between investee, Swiss Post, MS Direct Group, and Wayra UK. Guuru was able to convince many new customers in 2019 and thus increase its revenues by over 150% from Q2 to Q3 alone.

Outlook 2020

In 2019 we have tested a total of over 1000 start-ups. Thanks to the good preparation, our deal pipeline is full to bursting with potential deals for 2020.

We are currently focusing on the closing of the EquityPitcher Venture Fund and are in the process of closing several investments simultaneously.

We look forward to another successful year 2020 and wish you all the best for the new decade!

With kind regards,

Hermann & Sascha

OnlineDoctor is our newest portfolio company

Gone are the days when you had to wait 3 months for your appointment with the dermatologist. The OnlineDoctor skin check platform offers fast, location-independent and cost-effective a specialist's assessment. In four out of five cases, a physical visit to the doctor is no longer necessary afterwards.

OnlineDoctor has closed the Series A financing round was announced. EquityPitcher supports this together with forty:one and Startfeld.

The founders of OnlineDoctor from left to right Paul Scheidegger, Tobias Wolf and Philipp Wustrow

We first became aware of OnlineDoctor at the Investor Summit in Liechtenstein. The participation resulted from this first contact. "OnlineDoctor could convince with different points. Patients and doctors alike benefit from using the platform. Innovative technology is used which enables an uncomplicated and high-quality service. At the same time, the data is protected at all times using the latest encryption technology.say the founders of EquityPitcher.

The platform is becoming increasingly well known. More than 70 Swiss dermatologists are currently connected to the OnlineDoctor network. The funds received are used for Expansion to Austria and Germany, as well as the extend of cooperation projects with regional hospitals, pharmacies and insurance companies.