German SME lending platform creditshelf announced that it has received €62 million in investor funds, including €30 million from the European Investment Fund (EIF) as lead investor, to set up the “Creditshelf Loan Fund”. The diversified fund will help creditshelf meet German small and medium-sized enterprises (SMEs)’ increasing demand for financing.
The fund is a closed alternative investment fund. It aims to attract additional investors over several rounds of financing with a target volume of up to €150 million and a regular maturity of 6 years. The fund invests exclusively in SME loans arranged via the creditshelf platform in compliance with clearly defined investment criteria and diversification guidelines. It is subject to the regulatory requirements of the European AIFMD (Alternative Investment Fund Managers Directive) and will shortly be approved for sale to professional investors in Germany.
First Investment of the EIF in a German Alternative Credit Platform
The European Investment Fund (EIF) contributed €30 million. It is the first investment of the EIF in a German alternative credit platform with a focus on SMEs. The EIF’s investment is part of the investment plan for Europe, the so-called Juncker Plan, which is secured by the European Fund for Strategic Investments (EFSI). Its goal is to boost investment to help create jobs.
Dr. Tim Thabe, CEO and co-founder of creditshelf declared:
“We are proud to be the first German SME credit platform the EIF has placed its trust in. Medium-sized companies are the foundation of the German economy and, in the current situation as well as in the future, need funding for growth and investment.
“In times of unprecedented crisis, it is vital that SMEs get the support they need. Diversified debt funds offer small businesses an alternative to classic bank loans, with speed deployment and a flexible approach. Our collaboration with creditshelf – with the backing of EFSI (European Fund for Strategic Investments) – comes at an important time as we try to support small and medium-sized enterprises across Europe and help them meet the enormous challenges of the COVID-19 crisis.”
Meeting Increased Demand in Time of Crisis
The fund will act as a further investor on the creditshelf platform, in addition to the existing pool of investors. It will help meet the strong increase in demand observed since the beginning of the year. In the first quarter of 2020 characterized by the uncertainties due to the Coronavirus pandemic, creditshelf saw a 60% increase in credit inquiries compared to the same quarter in the previous year.
The fund’s launch is sending a strong, positive signal in the direction of German SMEs and will make an important contribution to promoting their growth by helping them secure liquidity.
In addition to the €30 million from the EIF, the credit fund was able to collect a further €32 million from creditshelf ‘s investors. This includes a significant commitment from the two founders of creditshelf, Dr. Tim Thabe and Dr. Daniel Bartsch, who will convert smaller parts of their shares into an investment fund to demonstrate their strong confidence in the concept.
Daniel Bartsch, board member and co-founder of creditshelf declared:
“With the completion of the first round of financing, we have taken an important step towards our company’s further growth. It is particularly useful in these challenging times to have an institutional partner like the EIF at your side. I am convinced that with our platform we can make an important contribution to promoting digitization in German SME financing and that we will be a reliable partner to our customers in the current, challenging situation.
Therese Torris, PhD, is a Senior Contributing Editor to Crowdfund Insider. She is an entrepreneur and consultant in eFinance and eCommerce based in Paris. She has covered crowdfunding and P2P lending since the early days when Zopa was created in the United Kingdom. She was a director of research and consulting at Gartner Group Europe, Senior VP at Forrester Research and Content VP at Twenga. She publishes a French personal finance blog, Le Blog Finance Pratique. Torris is also a graduate of INSEAD.