Total venture capital flows in Europe are currently running at about €4 billion per year while the European Investment Bank in 2015 arranged €24 billion in loan funding to SMEs and midcaps.  Anecdotal evidence suggests that the photonics sector in Europe acquired just tens of millions of venture capital in 2015, or 1% or less of all VC deals.  Photonics firms were unable to raise any EIB debt finance that wasn’t secured by real estate and none of the large Juncker fund deals approved to date have benefitted the sector.  VC activity in Europe is about 1/5^th of USA rates and 1/20^th of California rates.  China leapfrogged the EU in 2015 and India will do likewise within 48 months.    Access to finance is a major challenge for Europe generally.  For photonics the situation is particularly challanged.

Innovative growth oriented photonics firms are typically hardware driven, capital intensive and dependent on strategic trade partnerships. There are numerous complex sub-sectors requiring special expertise, timeframes to exit are variable and line-of-sight valuations - for Europe based firms - tend towards the hundreds of millions as opposed to the billions dreamed of by ICT investors. Europe’s multi-cultural and multi-lingual landscape can make it seem impenetrable to trade and financial investors, and equally difficult to navigate for CFOs seeking finance.  There are hidden gems waiting to be uncovered and US investors hardy enough to come looking do get bargains.   There is palpable excitement about the prospects for greater deal flow and there is great willingness among the players to get things moving.

The European Photonics Venture Forum at Eindhoven on 2-3 June 2016 will shake things up by introducing dozens of Europe’s hi-tech photonics entrepreneurs to trade and financial investors, by bringing together the people who can accelerate development of better equity and debt vehicles and by consolidating a vision and a strategy for greatly increasing flows of finance.  Hosted at Eindhoven’s magnificent High Tech Campus and presented as part of Europe’s ACTPHAST innovation accelerator the EPVF will put a spotlight on Eindhoven’s potential to become Europe’s first photonics mega-cluster, known as Photon Delta.  And one of the region’s star SMEs will be showcased as an ideal candidate for the EFSI’s first photonics debt deal.  We look forward to seeing you there!