Commission approves EUR 4.4 million for innovative SME platform
The European Commission has given its green light to aid for Investbx, an innovative platform which will raise capital for growing small and medium-sized enterprises (SMEs) in the UK's West Midlands region. The company Investbx aims to bridge the gap between investors and ambitious SMEs in the field of private equity by providing between €0.7 and €2.9 million to companies looking to expand. Competition Commissioner Neelie Kroes said: 'This aid will help growing SMEs get access to capital. Improving information transparency on the risk capital market will attack the very source of the market failure. I appreciate in particular that all equity investment at Investbx will be provided by private investors. Investbx is a very innovative project, which may be a valuable precedent for other Member States.' The innovative idea behind Investbx is to publish on its website a detailed analytical research report about each SME seeking investment, a move usually reserved for institutional investors with larger stocks of shares. Furthermore, Investbx will provide an online auction-based platform for trading shares of SMEs. The advantage of this system compared to established marketplaces should be to eliminate the spread between the bid and the offer price. Investbx will receive a €4.4 (GBP 3 million) grant to offset its initial losses during an initial period of up to five years. If the project is successful at the end of the trial period, Investbx will be sold to private investors. If not, it will be closed.
Countries
United Kingdom