05 Mar Will Symbid become the booking.com for SME financing?
Symbid, a Dutch FinTech start-up founded in 2011, announced yesterday to have launched their new online platform called ‘the Funding Network’. During an official press conference in Amsterdam - Holland FinTech was one of the few selected to attend - the founders unveiled a quite ambitious goal; to become the nr1 platform for SME financing in the same way as what booking.com is for booking a hotel. Here’s our report.
What is Symbid?
Symbid was in the early days one of first equity based crowdfunding platforms now innovating to a much broader platform. Management decided their platform should transform to a total solution package or go-to platform for SME’s and (potential) investors, hence the birth of the Funding Network. Symbid is founded by Robin Slakhorst and Korstiaan Zandvliet and has offices in Rotterdam, Amsterdam and New York, where they are listed on the US stock market under the ticker code SBID.
SME’s still struggle with attracting capital
There are reports out there that indicate that traditional banks aren’t so keen anymore on lending out cash to SME’s. As a matter of fact, the Netherlands is nowadays the toughest place in Europe (source, p36) for SME’s to obtain a loan from a bank. This trend has caused the alternative financing landscape to spring up and grow substantially. But still, it remains a challenge for many SME’s to get the right financing in time. There are ample crowdfunding platforms available, but transparency is lacking, there’s no standardization in the flow of information, and the financing options are often limited.
Marketing guru Ronald van Kralingen, who was also present at the press conference, shared his thoughts on the current and upcoming trends of the financial sector. According to him, traditional banks are destined to lose market share to big tech firms like Apple and Google. Big data, especially people’s payment history, is worth a lot to those firms. Will they get a hold of this type of information? There’s no clear answer yet, the banks, of course, want to keep this big data for themselves. The role of start-ups is also very important. They can take over, because banks are failing to cater to certain needs in this industry. Ronald van Kralingen explained that Symbid’s initiative has the potential to disrupt the traditional flow of capital.
Symbid’s innovation; the Funding Network
The Funding Network is a go-to platform connecting SME enterprises to all types of funding, traditional and alternative. It represents the next phase in the evolution of the peer-to-peer in the financial industry. Whereas ‘traditional’ crowdfunding platform often only offers either a debt-based or reward-based solution, Symbid’s new solution presents the widest range of options possible (debt, equity, reward, etc), enabling entrepreneurs to create an optimal financing mix with ease at just one counter. Private investors can initiate investments ranging from really low levels (minimum is 20 euro), so everybody can join, to the serious business angel type of investments. In this way, the Funding Network is positioned to appeal to a very wide audience.
Also, investors get full transparency on the potential risks and returns of their portfolio. Every entrepreneur connecting to The Funding Network is guided towards the right type of funding with professional financial advice. Meanwhile, investors can personalize their deal flow according to key business criteria. This produces the most effective capital allocation service possible, underpinned by innovative standardized XBRL data which directly streams from accounting reporting systems. This standardised reporting (a part of Symbid’s monitoring module) is really a key element of the solution, providing access for investors to a reliable and comparable form of reporting, so they can make well-informed decisions.
Symbid’s vision on the future
For 2015, Symbid expects to facilitate up to a billion euro’s in financing for over 2500 companies, which equates to almost 20% of the total financing of Dutch SME’s. That is quite a bold target considering their track record of only 6 million euros in funding since 2011. This quarter, they will expand to the southern part of Europe. Eventually, they want to become Europe’s nr1 platform. On a more abstract level, Symbid foresees that entrepreneurs will automatically use go-to platforms like theirs for all their financing needs, just like people use an online hotel crawler like booking.com for making a hotel reservation. The information is big data driven and standardized so the rules of the game are fair and even for everybody.
So will Symbid be the booking.com in SME financing? Time will tell, but as of today, they sure offer a very compelling and unique solution for SME’s and investors. Check out more at http://symbidcorp.com/
Blogpost by Sujan Lahiri, Research Consultant Holland FinTech
