1. Support to innovative funding instruments TAIEX Workshop Emmanuel Noutary, Director, ANIMA – Invest in Med Milan, 26 October 2011 www.anima.coop

2. ANIMA background Initially: an EU project of 5 years (2002-2007)…  Approx. €9m, incl. €4 m from the EC (high leverage)  Foreign Direct Investment academy (60 seminars & conferences, 20 study trips & internships, participation to 79 Euromed events)  A Mediterranean think tank (30 studies & observatories)  www.animaweb.org (approx. 100 000 visitors/month) …which led ot the creation of a formal network  79 organisations, 22 countries from both Mediterranean rims  Investment promotion, territorial and export agencies (south/ north, national/ regional/local)  Business networks and org. (BusinessMed, EBAN, INSME, AFAEMME…)  SME and Innovation support organisations (API, JEDCO, EBN…)  International organisations (OECD, GIZ, AFD, WAIPA)  The structure ANIMA Investment Network has been created in 2006 October 2011 © ANIMA 2011 2

3. ANIMA target sectors and activities Strategy / Promotion for the MED territories  Studies and guide books on business opportunities  Observatories: Investment, Partnerships, Funds  MedAcademy: training sessions and seminars for economic development actors  Organisation of annual investment forum (EUROMED INVEST) Sector co-operation / clusters engineering  Identify key domains of the global positioning of the Mediterranean  Mobilisation and coaching of thematic business networks  Promotion of initiatives to develop these niche sectors and transversal issues (Diasporas)  Business events, staff exchanges, workshops, business support, etc. Innovation and entrepreneurship  Internationalisation of start-ups (coaching, bus. development)  Promotion of early stage financing  Support to innovation organisations and networks October 2011 © ANIMA 2011 3

4. How we went to innovation financing Creation of the Med funds observatory, 2008 - 2011  Panorama of private equity funds in the Mediterranean  US$ 60bln funds raised for the Med countries (500 funds) Co-ordination of Medibtikar activities on the Financing of Innovation (EU project 2006-09)  Creation of business angels networks: Morocco, Jordan, Tunisia  Publication of « Funding start-ups and SME innovation - Guide for MEDA countries », June 2008  Pre business plan of a financing facility for Med start-ups (RIFF) Leader of Invest in Med (EU project 2008-11)  Launch of 18 initiatives related to innovation (design, value creation) or entrepreneurship support (access to finance, coaching, …)  MedVentures –initiative to support the international development of innovative start-ups – Dealflow demonstration, accelerator service Management of the FARO since 2010 (French fund)  Seed fund (1M€) for partnerships between innovative firms  Already 15 companies financed  Replication in Lebanon October 2011 © ANIMA 2011 4

5. 18 octobre 20105 General development of innovation policies in the MPCs Science parks & technopoles  Infrastructures rather than services Incubators and “pépinières”  Different approaches (public vs public-private, coaching vs equity) Networking starts  EEN/ CIP/ EBN opened to the Mediterranean  FP7…  Projects: InfoDEV/ Medibtikar/MIRA/ Invest in Med Emerging financing market for innovation  Grants, guarantees, seed funds, VCs  The financing chain unequally covered depending on the country Overall lack of interactions between stakeholders  Financing actors and innovation support organisations  Innovative firms and sources of finance  Public and private Lancement IT1 © ANIMA 2010 October 2011 © ANIMA 2011 5

6. MedFunds observatory 2011 Overview October 2011 © ANIMA 2011 6

7. A MedFunds observatory findings Lack of early stage financing  $2,2bn (outside Israel) on early stages out of $90bn total PE targeted  Slower growth than other stages of financing October 2011 © ANIMA 2011 7 Targeted amounts by stage of financing (source: MedFunds 2011)

8. Survey of the financing options available across Algeria, Egypt, Jordan, Lebanon, Morocco, Tunisia, Turkey Visited Investment funds, banks, support agency, ministries, business association and representative organisations Mapping Finance Estimate the deal flow from Innovative Companies in the MEDA. Measure the quantity in terms of countries and sectors. Assess the quality in terms of sectors and projects. Identify the potential intermediary organizations to source projects. Survey of Deal flow Mapping of innovation financing & deal flow - 2008 October 2011 © ANIMA 2011 8

9. Very limited international funding facilities Major gap in seed funding between 50-500K€ Insufficient information linking entrepreneurs and financing actors Innovative companies are failing because internationalisation is not anticipated Main Findings Seed fund / VCGuarantee fund SME Incubator investors Business Angels Programme Grants Regional actors4 Algeria323 Egypt3114 Jordan163 Lebanon2132 Morocco111 2 Syria33 Tunisia81196 Turkey6113 Negative international environment requires risk reduction MEDA Opportunities perceived as in privatisations, construction, energy & infrastructures Risk reduction includes larger portfolios, mutualisation of investors & equity guarantees Context Some results of the finance mapping October 2011 © ANIMA 2011 9

10. Estimate the deal flow quantitatively: by country and sector...... and qualitatively: type of Innovation, list of projects Identify Partners to source projects Assess the support needed Questionnaires sent returned by 38 Innovation intermediaries Objective Declared potential relevant annual deal flow around 300 to 500 through existing innovation actors Innovation occurs in strong regional sectors such as Agro-Food, Energy, ICT and Health Entrepreneurs need access to international markets to succeed Major risk for Entrepreneurs is finding finance followed by business development Major support required by Entrepreneurs is on finding finance Entrepreneurs in the region are focused on services rather than new products and technologies Some findings Estimate Med Deal flow for seed funding October 2011 © ANIMA 2011 10

11. October 2011 © ANIMA 2011 11 Support needed by innovative firms Services needed by 100 start-up companies having participated to MedVentures (source ANIMA – Invest in Med)  International development and networking comes first  Access to finance is just behind

12. October 2011 © ANIMA 2011 12 Sources of dealflow Partners of Medibtikar dealflow survey (2008). Algerian Startup Initiative, Alinov, Genilem (Algeria). EJB, GAFI, Ideavelopers, Itida, Nile Capital (Egypt). Invest in Israel, The Technology Incubators program (Israel). Bedaya Angel Investors Network, El Hassan Science City (Jordan). Berytech, Capital Trust (Lebanon). Fondation Banques Populaires pour la création d'entreprise, Fonds Dayam / Sherpa finance (Morocco). Palestine Information and Communications Technology Incubator (Palestinian Authority). Syrian Enterprise and Business Center (Syria). Sages Capital / Fonds Indet, UTICA (Tunisia). Galata Business Angels, LabX, MersinBAN (Turkey). And several Euromed networks: ANIMA, European Business Angels Network, European Business Incubators Network, INSME, International Society for Professional Innovation Management (ISPIM), Réseau Méditerranéen des Ecoles de Management, TechWadi (Arab-american technology association) Plus EU partners:. CCIMP, CDC Entreprises, Euroméditerranée, Invest in France, OSEO, Provence Promotion, Publicis Activ Marseille (France). Italian Business Angels Network (Italy) MedVentures coaches and partners (2010)

13.  40% of projects in the ICT Sector  Agro-Food is the other dominant sector  Biotech is an important emerging sector Sector distribution of innovative projects sourced annualy Source: Dealflow survey, Medibtikar, Nov. 2008 (38 answers) October 2011 © ANIMA 2011 13 Sectors of innovation - 2008

14. October 2011 © ANIMA 2011 14 Sectors of innovation - 2010 Trend confirmed for ICT and Health Sector distribution between the 100 start-ups of MedVentures 2010 (sourced by ANIMA with 20 South Med innovation actors)

15. Component 1 NETWORK & MATCH MAKING PLATFORM Qualify projects: need analysis  Coaching AND/OR Financing Promote projects toward investors: match making events and web platform Component 2 CONSULTING & COACHING TASK FORCE Pre/ Post-investment Due diligence consulting Monitoring (strategic watch) Component 3 CO-INVESTMENT/ EQUITY GARANTEES International Pre-seed, Seed, Venture Capital fund Co-investment with local fund MNCs Schools & Universities Innovative Start up/ SMEs R&D Centers Valorisation Industrial SMEs Science parks & incubators Investment funds Network of Dealflow providers – Coach - Partners October 2011 © ANIMA 2011 15 The RIFF proposition a regional networking, coaching and financing facility

16. 16 Euromed Capital Forum (24 April 2008) Promotion of Med funds and Mapping finance (lobby for more funds on early stage) Medibtikar Casablanca seminar (25 May 2008) 50 participants agree on a shared diagnostic and recommendations for boosting innovation and start-up financing Medibtikar Marseille Conference (20 November 2008) Signature of the Declaration of Marseille by 30 organisations, asking public donors and private actors to support the creation of a RIFF Euromed Industry in Nice (6 November 2008) Ministries of Italy, Morocco and Jordan raise the interministerial’s attention on the RIFF Working Party on EuroMed Industrial Cooperation (8 June 2009) The WP mandates ANIMA to study the feasibility of RIFF. Emphasise to be put on Diapora projects promotion. Launch of the MedVentures initiative (March 2010) Implementation of a pilot on the component 1 and 2 Mapping innovation financing Dealflow surveyRIFF Business Plan Med Funds Observatory Fund raising & implementation Shaping the RIFF October 2011 © ANIMA 2011 16 Creation of the FARO fund in France (May 2010) Funds UpM innovative projects 120 start-ups in “portfolio” (Sept. & Oct. 2011) Coaching and Bus. dev. roadshows on in Tunisa, Lebanon, France Creation of the FARO fund in Lebanon (Sept. 2011) Funds UpM innovative projects

17. Thank you for your attention  ANIMA Investment Network 11b rue Saint Ferréol 13001 Marseille – FR T. +33(0) 4 9611 6760 www.anima.coop  Emmanuel NOUTARY emmanuel.noutary@anima.coop