When traditional finance becomes passionate about start-ups

2023-11-12 19:00:10

In September, when the mood of investors and entrepreneurs alike was rather gloomy, the announcement of Verkor’s record fundraising brought some optimism back into the landscape. This Grenoble start-up has managed to secure more than 2 billion euros in funding to build its gigafactory of batteries for electric cars.

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This operation is representative of the new trends that will emerge in terms of financing: mix of capital, grants and debt, but also mix of investors of different natures, hitherto little present in venture capital.

Verkor’s financing consists of a Series C fundraising (this fundraising is aimed at a start-up that wants to continue its growth very quickly) of 850 million euros in capital provided by the funds of Australian Macquarie and French Meridiam infrastructures. The European Investment Bank is providing 600 million euros in bank financing. As for the French state, it will pay 650 million euros in subsidies in association with the Hauts-de-France region and the city of Dunkirk (North), which will host the factory.

Faster turnaround times

“Investing in tech has long been seen as the preserve of venture capital funds, mainly because of the size of the companies. Today, funds from private equity [l’investissement dans des entreprises non cotées] are interested in the sector and take shares in the capital or buy start-ups »remarks Stéphane Klécha, founder of the investment bank Klécha & Co. Thus, in July, the American fund Carlyle purchased the French start-up Pr0ph3cy, specializing in cybersecurity.

Other players – and not the least – have also entered the financing of tech. To diversify their investments in times of crisis, hedge funds (funds that aim for the best return) such as Tiger Global or Coatue Management, which manage funds worth several tens of billions of dollars and which invest in tens or hundreds of millions of dollars, have launched in the start-up market, until now the playground of only venture capital firms.

In addition to the importance of the amounts they invest, they are differentiated by the decision times that are infinitely faster than the usual file studies of venture capitalists. Enough to attract entrepreneurs and stimulate venture capital funds to react more quickly.

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