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The Investor’s Perspective on COVID-19: Options for Public and Private Funding"



House of Startups has held various webinars talking about a vast array of important topics in this time of crisis. From this special event, they talked about the investor's perspective on COVID-19 and shared some tips with the help of a few LBAN members on what investors and especially startups can do for public and private funding in these critical times.

Luxembourg with the help of the Chamber of commerce, HoST, and House of Entrepreneurship has taken part in launching many measures for startups, particularly in this COVID-19 crisis. With even supplying a helpline to share information to startups and companies on how to apply for bank guarantees, fiscal measures being taken, funds that are available and much more. If needed any information it is highly recommended to give them a call and see what best fits for your specific situation. The Ministry of Economy and startup department have also launched the COVID-19 startup program to grant 150k to 20 startups for them to have aid in continuing in this fight with the crisis.

The questions now come down to what are the investors doing and how are they using their knowledge and funds to support the startup ecosystem. After an elaborate discussion, the panel had some very constructive tips and advice.

Starting off with our own LBAN President, Stephan Peters, where he gave an interesting perspective on both sides of being an angel investor and startup owner. He gave essential advice from experience in the active startups he is more involved in by advising to work with them to figure out what are the next steps for the future and how to adapt to the changing situations. He recommended that most BAs should be taking such initiatives as well as be investing their time and knowledge. With that also begin drafting a full plan to create clear communication with all your stake holders. Stephan later shared 4 key points and questions he believes BAs and startups should take into perspective and be answering right now .

            1.  How does this situation change your industry?

            2.  Focus on what you can do in the company and how it can keep running.

            3. The industries have shifted and a lot of , where he gave an interesting perspective on both sides of being an angel investor and startup owner. He gave essential advice from experience in the active startups he is more involved in by advising to work with them to figure out what are the next steps for the future and how to adapt to the changing situations. He recommended that most BAs should be taking such initiatives as well as be investing their time and knowledge. With that also begin drafting a full plan to create clear communication with all your stakeholders. Stephan later shared 4 key points and questions he believes BAs and startups should take into perspective and be answering right now.

            4. Postpone the “nice to haves” and cut to have the focus of “we will survive.

Throughout the discussion, Larissa Best also gave various tips and perspectives on how she sees the current situation. With the economy now facing a financial crunch period, it is key to invest your time as a BA in your existing portfolios. Investors and Bas understand that now it is a very risky time. Consolidating your investment opportunities makes a lot a sense and many people are doing it because if you have capital it would be a smart move to invest in your own existing portfolios to make sure they will survive this current pressure. Larissa also shared some more practical advice on how to survive the next year from both inputs. 1. Communicating with your team and keep them motivated is key.

            2. Communicating with your existing investors is key because they are the ones that know you and trust you.

As the Lunch & Learn webinar continued, there was also great insights from members in the HoST such as CEO Philippe Linster and Nicolas Valaize. They shared vital tips and measures that are being taken today for the aid of the startup community and investors. Nicolas shared how important the relationship with investors (Angels or VCs) is right now and for them to see the growth in later months from actions taken in this time. He also mentioned how critical it is to reduce your burn rate as much as possible to survive at least until the end of this year. After a small discussion about the valuation, he noticed that a strong valuation in Luxembourg has been low already compared to any peer locations around Europe, so there will be no downward valuation going on especially for early-stage companies in Luxembourg. They are expected to see around 1-2 million Euros pre-money for very small tickets but with a very optimistic view and not worried about the valuation going down in Luxembourg compared to where they already were at. Philippe Linster then briefly talked about the amounts that are being injected to big countries and as well as in Luxembourg. At the end of the day, we are coming to a time where many companies, investors and startups are now going completely digital with using Zoom, Teams, Skype and has brought a huge challenge to implement these fundamental changes which are bringing new problems and yet creating new and positive innovative decisions.

The panel then gave their final advice from an important question:

What should entrepreneurs be focusing their time on right now?

Larissa Best =Concentrating on their operations

Stephan Peters = Communicating with your staff and current shareholders Philippe Linster = Looking at all your social media and keeping up to date with all the measures that are being launched

Nicolas Valaize = Emailing the VCs and setting up a call with them

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Key questions during the Webinar:

1. What about if you’re only raising from your exiting investors and from government grants? Still not possible?

-Raising from your existing investors & government grants is the smartest move right now.

2. Even if a company is not looking good right now, for new funds, could it be the right moment to get in touch with VC to prepare the future 2021/2022? Or are they too busy to save what it could be?

An example was Michael Jackson a Mangrove who used a key factor in deciding whether his entrepreneurs were serious or not by asking them to fly to Luxembourg in person for a meeting. This will now change in this time of crisis and be much different in the future as well.

3. Are Business angels and VCs willing to invest money on a remote basis?

An example was Michael Jackson an Mangrove who used a key factor in deciding whether his entrepreneurs were serious or not by asking them to fly to Luxembourg in person for a meeting. This will now change in this time of crisis and be much different in the future as well.

Panel:

-Larissa Best, LBAN

-Stephan Peters, LBAN -Philippe Linster House of Startups

-Nicolas Valaize, House of Startups

-Moderated by Dara Nikolova, Rising Tide Europe 3

-Written by Mika, LBAN

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