Networking is everything

Glimpses of the Newion universe

For the past eighteen years Newion Investments has been ambitiously investing time, money and energy in outstanding young entrepreneurs. As you may know, our team is focusing primarily on the controlled growing of business-to-business software companies in the Benelux market, but it does so in a truly multi-faceted and colourful environment. In two feature articles we would like to take you on an exploratory round through our extensive international network of accelerators, incubators, development agencies and colleague VC’s.

The Venture Café Rotterdam is a true melting pot of creative people, starters, entrepreneurs and investors, right up to government representatives. Patrick Polak is on the board of the Venture Café on behalf of Newion Investments, together with InnovationQuarter (the regional development company for South Holland) and Justin Jansen, professor of entrepreneurship at Erasmus University Rotterdam. A fine trinity, according to Venture Café director Anoesjka Imambaks. “With a monthly theme we bring a structure to our meetings. We have a public mission from the municipality of Rotterdam, which means that we are expected to link up with the city agenda and what else is happening around us. To steer this in the right direction, it is nice if you can plan clearly.

By curating for a whole month, you can ensure that meetings take place that are not obvious. For that is exactly what we want, that crossover. Making connections. And yes, after a year and a half in this format every Café is very successful. For us, who you are as a company or what you have done is less important than who you are as a person. Sometimes people need an introduction, but we help you find your way around, no matter if you are a student with a great idea or a minister from Saudi Arabia. Participation in a session is not mandatory, you can also have a nice conversation at the bar that may be fruitful. No obligations! Online contact is fun, but talking to each other, noticing where the interests lie and the ideas come from, that’s what counts.”

Oost NL is an investment company with public money that invests in early and later stage companies. Rob Jansen, investment manager High Tech, explains that the social goal of Oost NL is paramount: "As in: creating employment and preferably making a social contribution to one of the eight social challenges, as we have named them in the Netherlands. Financial return does play a role, but it is certainly not the most important argument for us to start a possible financing. We manage the funds of the provinces of Overijssel and Gelderland. These are different funds, with their own fund conditions and an external investment committee that is separate from the province. If we invest, the head office of that company, and the place where the people are hired for that company, must be in one of the two provinces. However, they will often expand nationally or internationally. When I look at the companies I manage from the high-tech side, these are often university spin-offs that have grown a lot, and all of them companies operating on the global market with a piece of unique technology.”

YES!Delft describes itself online as "A leading complex tech incubator that brings your product to the market as fast as possible". Merijn Zondag has been working at YES!Delft as its Investment Director since 12 months. He is a mentor as well, and as such supports young entrepreneurs - often scientists or engineers who want to test the commercial feasibility of their idea, product or technology with their funding needs. “YES!Delft has traditionally been primarily focused on hardware but this is rapidly changing into other areas where the software and data are just as important. Eighty percent of our start-ups come from TU Delft. We support these companies as an incubator in their acceleration and growth in eight different focus areas, from complex tech and medtech to for example blockchain and artificial intelligence. I approached Patrick Polak from Newion for our “Meet the VC’s”-event where we link up our start-ups to investors. On such a day the start-ups that want to obtain funding explain to the investors who they are, what they are planning, how much money they need, what they want to do with it. Many were successful thanks also to Patrick’s advice and feedback.

High-Tech Gründerfonds (HTGF) invests in early German tech startups, having over 32 German Corporates as LP on board. It is the perfect jumping board for Newion into the German market. Dr. Tanja Emmerling, the Principal at the Berlin office, explains HTGF’s focus: “We have three funds under management, for a total sum of 900 million euro. The first one launched in 2005, the second in 2011 and the third just closed, with 316 million euros. We have made over 500 investments since 2005. There are about 270 companies active in our portfolio, on three pillars: life-sciences, hardware and software, everything focused on tech. We invest in seed, which in our case means that the companies aren’t older than three years and have no more than 500.000 euro investment money already on board. In seed stage we will invest between 600.000 and one million euro as a first ticket, and we can invest up to 3 million in one company. Usually, we want to guide the company until the exit, if possible.”

Reaktor is an equity free four-month acceleration program for startups from the Wallonia region in Belgium. The program is aimed at progress, both on a national and an international level. Nathalie Guilmot, Project manager for Reaktor: “The objective of the Reaktor program is to help startups accelerate their growth and get ready to raise between 500.000 and one million euro. We are not an accelerator program where hundreds of companies are ‘accelerated’ each year. Instead, we work with no more than ten companies per year, doing whatever is necessary – especially building a network of experts and invests – to ensure that each and every company achieves the operating milestones required for the next round of financing. So that is why I invited Patrick Polak of Newion to the ‘Investor Mindset’ at the Creative Wallonia headquarters in Mont-Saint-Guibert. He shared his experience during the seminars and was present during the investment event. An interesting opportunity for the startups, especially since he was together with Thibaut Claes from WING, a public company from Belgium which provides seed capital to early startups. Thibaut had a more theoretical point-of-view, whereas Patrick was talking from his personal experience as an investor.”

Rockstart is an accelerator for early-stage companies. Active since 2011, the company has so far invested in 138 startups and raised a total of 63 million euro in follow-up funding. Don Ritzen, one of the founders of Rockstart: “Our success is based on a combination of capital, the expertise of the mentors and the community, through our location in Amsterdam, and the events we organize. The accelerators we now offer - Web & Mobile, Artificial Intelligence, Healthcare and Smart Energy - are the sectors we believe in and have built communities around. Newion has looked at a number of companies in connection with possible follow-up financing. Usually, when a startup comes out of Rockstart, angel investors are sought to do the first round.

After that, and sometimes even at the same time, Newion comes on board. They actively look at the international companies we bring to the Netherlands: whether there is a company they believe in and in which they would like to invest further. Newion has large assets under management and works intensively on a select number of investments for about five to seven years. Rockstart, on the other hand, has a broader portfolio approach. We invest in fifty companies a year; a large volume. Of course, we hope that one or two per group of ten will do very well, which will ensure that the entire fund has a return. The phase that we invest in is most risky, but also exciting and financially attractive when a company does really well.”

The golden rule for Newion Investments will remain Ambition – Focus – Execution. The inherent value of this trinity is recognized by the companies and programs mentioned above, which guarantees for an ever-inspiring and interesting exchange of ideas. After all, the strength of our ecosystem is essential to our significance as an investor. That is why we believe in long-term and two-way relationships, be it with the startups we choose to work with, with a developer, or with colleague-investors. In our next newsletter we will look at some of our business contacts who are moving in areas beyond our primary reach.

Written by: Mark van Schaick