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FROM REAL LIFE The foundation of the success achieved by the family-run company Baum Zerspanungstechnik Page 18

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“Standing still means going backwards.” this is certainly not the first time you’re hearing this sound bite. from our point of view, though, it describes a principle that all CEOs, managers and board members should take to heart. We, as the designers of the digital financing of SmEs, also adhere to the idea by working on ever improved technologies, by building out a profitable network and by generating entrepreneurial stimuli — for instance, by our creditshelf magazine. that brings us directly to the topic at hand: How satisfied are you with the magazine? do you feel fully informed or are you missing certain subjects? What can we do to make you feel perfectly prepared for the challenges awaiting you in your dayto-day work as an entrepreneur? Let us know!

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Editorial

Dear Readers, It’s the milestones that shape the development of a company. They instil pride and motivate managers and board members to stay on top of things. Sometimes, a company succeeds in leaving a clear mark on the market. Sometimes, however, it is changes from the outside, such as the accelerating digitisation of an industry, that rip you out of your comfort zone. Then the motto can only be: Let’s tackle it straight on! You don’t passively have to accept new developments, competitors and trends on the market – you can use them as an impetus for your own actions. With hindsight, it frequently turns out that a new way of thinking and adaptation of the company strategy has ultimately resulted in major development boosts in the right direction. We at creditshelf recently also reached a new milestone in the lending business: Since the commencement of our business activities, we have arranged loans of a total volume of more than EUR 100 million for German SMEs with our digital business model – a success that pleases us mightily. If you accelerate your thinking into fourth gear, you’ll realise what else became possible with this success. Many entrepreneurs had ample reason to be pleased about additional capital for their investment projects. In this issue, we want to introduce two awe-inspiring personalities to you: The two managing directors Melanie Baum and Peter Müller needed capital for equipment financing and contacted creditshelf. Other companies request loans on our digital platform for pending projects or growth schemes. Growth strategies, in particular, are only possible when entrepreneurs are not just marking time but have their eyes on market condi-

tions and are checking things out in relation to their business model. By the way: This is true not only for small and medium-sized enterprises but also for established banks and financial institutions. creditshelf customer account manager Richard Heller and Dr. Mark Mietzner from Zeppelin University have a great deal to say about it. You won’t be surprised to hear that, among other things, it is digitisation that has turned the financing market on its head. Even for us as pioneers and passionate operators in this area, it’s always wonderful to see how many promising opportunities open up due to technological and digital change. You want to know what these opportunities are? If so, please don’t hesitate long and read the following articles. Become a part of the creditshelf network and experience the fact that collaboration is an integral part of it.

Dr. Tim Thabe Co-Founder and Chairman of the Board of creditshelf

Editorial

Overview 3

Editorial

Table of Contents and masthead

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24 27

TRENDS

Finanzierungsmonitor 2019: “Building a weatherresistant financing structure”

From real life

tegos GmbH & Co. KG: Partner and problem solver

A VIEW OF THE MARKET

Trends and recommendations for action in corporate financing

FROM REAL LIFE

Baum Zerspanungstechnik e.K.: A human being through and through

A GLIMPSE BEHIND THE SCENES

Faster and better data processing through augmented intelligence

STIMULI

Corporate culture sets the course for digital transformation

STIMULI

Our influencers reveal the things that drive SMEs and investors

DATES

Don’t miss these network activities and events!

Cooperation projects

End of odyssey: AMB and creditshelf end capital odyssey

TRENDS

Zeppelin study: Doubts and fears regarding FinTech companies are unfounded

AT A GLANCE

Range of services and key data of creditshelf at a glance

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Publishers: creditshelf Aktiengesellschaft Mainzer Landstraße 33a 60329 Frankfurt/Main, Germany Telephone: +49 69 348 772 40 E-mail: info@creditshelf.com www.creditshelf.com Board of Management: Dr. Tim Thabe (Chairman), Dr. Daniel Bartsch, Dr. Mark Währisch Chairman of the Supervisory Board: Rolf Elgeti Entered at the Frankfurt/Main District Court – Comm. Reg. no. 112087 VAT ID: DE298667279 Responsible under the German press law: Birgit Hass (Head of Marketing and Communication, creditshelf AG) Head of Advertising: Birgit Hass (Head of Marketing and Communication, creditshelf AG)

Conceptual design and implementation: ABG Marketing GmbH & Co. KG www.abg-partner.de Editorial office: Ilka Stiegler, Dominik Schilling, Cindy Knoblauch, Nora Körner ABG Marketing GmbH & Co. KG Layout and design: Alin Poetzsch ABG Marketing GmbH & Co. KG Print: RheinMail GmbH, Boppard Photo credits: yy creditshelf AG yy Jan Bürgermeister (www.fotostate.com) yy Laura Gabriel (creditshelf AG) yy Sebastian Seibold (creditshelf AG) yy Company photos

yy Mahya Ketabchi (creditshelf AG)

yy Bert Bostelmann Head of Subscription Service: (www.bildfolio.de) Laura Gabriel (Marketing and Editorial deadline: 18 January 2019 Communication, creditshelf AG) Print run: 100,000 Internal project team of creditshelf: Birgit Hass, Jan Richardson, Laura Gabriel, Nico Bleh, Richard Heller, Sebastian Seibold, Zorana Bejtovic

Edition 1 / 2019 • creditshelf

Trends

Dr. Daniel Bartsch

“Building a weather-resistant financing structure” The latest findings of Finanzierungsmonitor 2019 Although creditshelf, together with TU Darmstadt, has been taking the pulse of the German economy for more than four years in a row, “Finanzierungsmonitor 2019” is something of a one-of-a-kind first. After the last few years featured full order books and companies could hardly keep up, first dark clouds are showing on the economic horizon. Global trade conflicts do not leave the German economy unscathed. 47 percent of small and medium-sized enterprises in this country complain that their business is strongly, or even very strongly, affected by current global trade disputes. Only seven percent of the 200 financial decision-makers who were interviewed said they don’t see themselves affected at all. Furthermore, 50 percent of the companies reported that access to loans is now even worse than twelve months ago.

Dr. Dirk Schiereck

“Not yet completely switched into crisis mood” “Our study also shows: Companies have not yet completely switched into crisis mood”, says Dr. Daniel Bartsch, co-founder and member of the Board of Management of creditshelf. “The majority of the financial decision-makers expect there won’t be any further deterioration of the financing conditions after the adjustments already made in 2018.” Dr. Dirk Schiereck, who has provided academic support to “Finanzierungsmonitor” since its first edition, has observed increased attentiveness on the part of the companies but as yet no real unease. “The current experience with punitive tariffs and import quotas ought to be

Trends

a warning to companies and prompt them to build a weather-resistant financing structure if it hasn’t been done yet”, says the financing expert from TU Darmstadt. Financing is turning into a bottleneck for digitisation A stable financial structure is all the more important in view of the fact that digitisation does not allow for taking a break, even in somewhat rougher times for the economy. Most companies agree: For 72 per cent of them, Industry 4.0, artificial intelligence, etc., are important or even very important for this year’s investment planning. At the same time, two out of three CEOs fear that the factor of financing might turn into a bottleneck for the digitisation of their companies. Above all, worries prevail in the industrial and service sector. Since digitisation means that the financing of intangible assets is also gaining in significance, the search for alternative funding, in addition to traditional bank loans, is becoming more and more vital. 54 percent of the companies surveyed for the “Finanzierungsmonitor” have financed intangible assets in alternative ways at least once in the past. This means that these new ways of funding have nearly caught up with the financing of intangible assets via the principal bank. “Not least in economically and geopolitically troubled times, companies should – even beyond the funding of the digital transformation – open up other options in good time so that they always remain able to act”, recommends creditshelf board member Bartsch.

Partner and problem solver According to FOCUS, tegos, the system supplier for mobile homes and caravans, is one of the 500 fastest growing companies in Germany. With a 93 percent sales growth inside of two years, this appears fairly obvious. Managing Director Peter Müller firmly believes in further growth in the future. Read here what the died-in-the-wool family entrepreneur has done for success until now, how things will proceed and why he does not want to do without creditshelf.

Building and managing a company successfully Absolutely no need to tell a man like Peter Müller how it’s done. The B.A. graduate can look back on twenty-five years of experience as a manager at three companies in different industries. That was the situation roughly seven years – then he came across a job ad for a managing partner at tegos. All-rounder with ambitious goals The company sees itself as a system supplier and development partner for selected manufacturers of high-quality recreation vehicles. “The right company size and an optimum ratio between income and investment were ultimately the arguments that won me over to taking on the managing position there in February 2012”, Peter Müller explains. And he is still filled with enthusiasm today. The rest, i.e. a thorough familiarisation with the industry, about which he had no idea up till then, he owes to his former activity as organisational consultant with Ernst & Young: “I’m accustomed to get6

ting familiar with new companies and markets quickly and I’ve always been committed to putting companies on a path towards growth.” A total 93 percent rise in sales from 2016 to 2018 is ample proof of how he succeeded in doing just that at tegos. Is it simply due to the boom that has been lasting in the market for recreation vehicles since 2015? “No way”, the entrepreneur stresses. “Such a success does not just fall into your lap. You must do something for it and can’t just rely on the market.”

Baden-Württemberg. He established a cloud/ SAP system to optimise the business processes, did a great deal of networking and acquisition. The dedication paid off. In 2016, “overnight”, a large order from a premium caravan manufacturer materialised. “It was an important milestone for us in the company’s development. Not only was it an order from a completely new and renowned manufacturer, it also ensured a significant spurt in growth”, the Managing Director recounts with visible pride.

New order and growth spurt in one fell sweep

Never stand still: A sense for trends and needs

Competitors of tegos include both globally operating corporations and small family-run enterprises. For door systems alone, there are four to five providers in Europe. “It doesn’t sound like much”, says Peter Müller. “But still, it is important to keep the upper hand against these competitors.” In order to make it possible, Peter Müller lost no time when he took over the mid-sized company at its location in Ostrach,

In tandem with that, according to Peter Müller, it’s not always only about gaining one order after the other and scoring big with your service. “Quality and technology are the two factors that separate the wheat from the chaff”, the Business Admin graduate emphasises. This means: The tegos team relies on maximum vertical integration and in-house expertise. In the truest sense of the word, everybody can

Edition 1 / 2019 • creditshelf

From real life be confident that the products and services are 100% from tegos. Because the company is both a system supplier in the B2B area and active in the end customer manufacture in retrofitting. Especially when it comes to retrofitting, replacements and individual productions for the after-market, tegos has been the market leader for many years now. “We are keen to keep up with the times and pick up on needs such as the increasing demand for comfort and safety. For this reason, we’re always in close touch with the latest trends on the market. At trade fairs, we talk directly to caravan owners and interested parties.” In this way, the company has not only made a name for itself as a renowned system supplier for the manufacturers of recreation vehicles. At the same time, it became famous as a problem solver that derives innovative ideas from specific needs and develops products that are at a later time made available to a great number of satisfied caravan owners through serial orders. Just one example of many is the “outfly” brand: With this brand, the business segment of tegos was expanded

with insect protection systems for properties in 2015. So much for the business – but is there any time left for the family? Family business means: “All of us go all out for success together” In the case of tegos, family is a pretty apt keyword. Because here, the term is not used as an empty phrase but actually characterises the corporate culture. Alongside Peter Müller, his wife Ilona Müller, sons Christopher and Matthias Müller, daughter Stephanie Scheld and son-in-law Alexander Scheld hold responsible executive positions with the company. But not only the top-management floor is family – the relationship with partners, customers and employees is also quite family-like. How does it show? Peter Müller has an answer: “Profit should not have priority over everything else in a company. A respectful and congenial way of dealing with one another is just as important. We’re proud of our 160 employees, who all go all out for success. As the Managing Director,

I take pride in employing such people in my company”, says Müller. “It can be seen in so many little things – even little gifts such as the home-made 3-D birthday card from my wife.” One man who can confirm this is Martin Geißler. The banker by profession has been working for creditshelf, the digital financial backer for SMEs, since 2018 as the competent account manager. He recalls: “I got to know Peter Müller as a very open, down-to-earth person and at the same time as a committed and very capable entrepreneur. I sensed that immediately when I visited the company headquarters in Ostrach. When he took me on a guided tour through the production hall, I got a good impression of the highly structured processes and the premium quality of the products. During the tour, he made a point of congratulating an employee for his 50th birthday. For me as an account manager, it is a valuable experience to meet such model entrepreneurs and work together with them.” That the encounter came into being was inevitable.

“The procurement of liquidity for growth projects and the implementation of innovative ideas are among the greatest problems an entrepreneur must face. It is reassuring to know that FinTechs such as creditshelf open up ways of financing that are completely new, quick and flexible.” Peter Müller, Managing Partner, tegos GmbH & Co. KG

From real life

creditshelf wherever one looked A specialist article in Frankfurter Allgemeine Zeitung, a booth at the SME Forum in BadenWürttemberg and the first edition of the creditshelf magazine: “You simply couldn’t miss creditshelf”, says Peter Müller and laughs. “Of course, it’s natural then that you want to find out more about this new form of financing. And since I’m always on the lookout for innovations anyhow, I thought to myself: I certainly won’t stop when it comes to questions of financing.” The completed return fax on the back of the magazine finally landed on the desk of Martin Geißler, who promptly picked up the phone and contacted the Managing Director. The chemistry was right from the first telephone conversation on. “And that was not just due to our shared passion for cars”, the 61-year-old Peter Müller adds, winking. He didn’t let much time pass after the phone call. On the way back from a trade fair, he took a detour via Mainzer Landstraße in Frankfurt: the headquarters of creditshelf. A first one-on-one discussion and exchange of information took place here. An ideal supplement to the principal bank

“From my point of view, alongside the exclusive analysis of the company figures, it’s absolutely necessary to know the company, the products and the market, including competitors. Only then can all risks be assessed to be ultimately able to make a reliable decision on Yes or No to the credit arrangement.” Martin Geißler, Corporate Account Manager, creditshelf Aktiengesellschaft

Edition 1 / 2019 • creditshelf

tegos has been successful over the last few years and has grown enormously. For things to continue this way, partnerships must be continually built out and more large orders acquired. Liquidity needs are correspondingly long-term and high. The Managing Director: “Although I’ve been working with my principal bank for a long time and on a basis of trust, I was on the lookout for another partner for a multi-year bridge financing. We’re talking about EUR 1 million here, a sum that you shouldn’t have covered by one lender alone.” At this point, an additional provider such as creditshelf, which conveniently, quickly and flexibly brokered a loan via a network of professional investors, was right on cue for Peter Müller: “With the mix of traditional financing by the principal bank and a digital, innovative form like a loan from creditshelf, I’m perfectly prepared for the future in terms of liquidity.”

From real life

Not only the result counts but the way to achieve it as well Peter Müller likes creditshelf not only because of the capital in the amount of EUR 1 million that he received in early November of last year or because of the fact that no more than ten weeks lapsed from the initial request to the payment. “The smooth procedure is worthy of equal praise”, says Müller. “Quick decisions, an ongoing, personal exchange and an overall professional way of working. Martin Geißler as the account manager has totally won me over with his professionalism and expertise. Apart from his experience in commercial financing, he quickly familiarised himself with our company portfolio and the rather specialised market.” Martin Geißler adds: “From my point of view, alongside the bare analysis of the company figures, it is absolutely necessary to know the company, the products and the market, including competitors. Only then can all risks be assessed to be ultimately able to make a reliable decision on Yes or No to the credit arrangement.” “Efforts will pay off” After a thorough risk analysis, the creditshelf account manager gave the go-ahead: Geißler comments: “I’m pretty sure that tegos will continue to grow – not least owing to the tireless

entrepreneurial spirit of Peter Müller and his family, who always stay right on the ball and keep up with the times. In short: Their reputation as a reliable systems supplier, partner and problem solver is more than justified.” Peter Müller returns the compliment: “As the CEO and as an entrepreneur, you have more than enough problems to take care of next to the operational business. The list is definitely topped by the procurement of liquidity for growth projects and the implementation of innovative ideas. It is reassuring to know that FinTechs such as creditshelf open up ways of financing that are completely new, flexible and above all quick. For me, this represents an additional option, supplementing the principal bank, on which I will certainly fall back upon in the future.” Partner and problem solver: If you thought these two terms only related to tegos, you ought to know better by now.

Also as a video on our YouTube channel

Products from tegos yy Door modules yy Flap modules yy Electro-mechanical assemblies yy Locking systems yy Insect protection systems yy Cable systems

In-house core competencies of tegos yy Development of complex modules and assemblies yy Bending and powder-coating of aluminium profiles yy Deep drawing, foaming, milling and gluing of moulded parts yy Flexible assembly of complex cable systems yy Pre- and final assembly of complex assemblies yy Individual logistics, including justin-time delivery

From real life

where does the JourneY take us? Interview about trends in corporate financing and recommendations for small and medium-sized businesses

Richard Heller is a banker and graduated economist. Since 2017, the 28-year-old has headed the Customer Account department of creditshelf. He takes care of new and satisfied customers, services credit inquiries and provides information on alternative corporate funding in lectures. In an exclusive interview for our magazine, he gives his views on trends in the financing market and on perspectives in the lending business. mr. Heller, would you gaze into the crystal ball? How will the lending rates change in the near future? Heller: I think they will remain at about the same level as they did in 2019. But after that, they will steadily rise. We won’t see large jumps in the lending rates again soon, though.

What is currently the mega-trend in the financing market? Heller: The FinTechs! They complement the principal bank, always come up with fresh ideas, fill niches in the market and move quite quickly. We at creditshelf, for example, offer our customers efficient solutions due to low process costs. From the customer’s point of view, we are simply a lean, agreeable financial backer that helps them, quite quickly and on a shortterm basis, with additional loans in the case of order peaks and purchase situations. Of course, the banks take a look at this too; and already today, they help themselves to the ideas of the FinTechs. In my view, however, they will not soon reach the speed with which we handle processes. Speed is what characterises us as a FinTech and makes us part of this mega-trend in the financing market.

Will we still have the traditional bank loan in ten years?

What other trends are there in addition to the mega-trend of fintech?

Heller: Yes, definitely! With yet another round of banking regulations – let’s call it Basel IV – bank processes will become even more expensive. The equity deposit obligations will increase and continue to impact the marginal return accounting of the banks. In the case of collateralised loans, the banks will continue to be first choice because they can offer relatively good terms.

Heller: Above all, there are the changing funding needs: Collateralised bank loans will continue to be handed out for planned investments. But more and more frequently, quick, short-term loans are needed, e.g. for seasonal business or to secure discounts and other favourable purchasing conditions. In such situations, the traditional lending paths are too slow, and we step in. Thanks to the digital systems provided by us for checking

Edition 1 / 2019 • creditshelf

A view of the market

financing requests, we can give feedback to a company within a very short period of time. Not much time passes until the request is rejected or accepted. Speed is important for an entrepreneur so he can continue to plan and knows whether he can accept the order or make the purchase. In summary, we can say that the trend of the future will consist of a mixture of tried-and-tested banking products and new products offered by the FinTechs. We see ourselves as a complement to the banks. What are the credit periods companies want today? Heller: It depends on the size and industry: Large, manufacturing businesses usually need purchase financing with a short-term maturity. In the case of large purchasing volumes and a strong discount option, a term of 24 to 36 months can be of interest. While larger companies like to act flexibly and quickly, smaller enterprises need greater security with less expense. Hence they sometimes prefer terms between 36 and 60 months. What should a healthy financing mix for a medium-sized company look like? Heller: Already today, our customers have one or two commercial banks and a regional bank as their principal bank, which all give mostly collateralised loans. In addition, there is more and more leasing and factoring as well as, occasionally, mezzanine financing or investments. This colourful bouquet of financing options has been augmented in recent times by the short-term uncollateralised loan usually needed during the year.

How will the financing mix change in the future? Heller: The increase in the equity ratios that we have observed for ten years and the stagnating traditional loan financing by banks show that there is a need for alternative financing options. Factoring and uncollateralised, fast loans are more and more in demand. Pay-per-use in relation to the use of movables will also be an issue. This goes hand in hand with the decline in relevance of principal banks â€“ which will probably be accelerated by the new regulatory requirements under Basel IV. What advice would you give the CEO of an SmE for his corporate financing? Heller: My advice: Diversify your financing mix! Just like you shouldnâ€™t focus on one big buyer in selling, you have to have a broad base for the purchase of financing. One can change a principal bank only medium-term and with relatively high expenditure. For all complementary factors of the financing mix, you should observe the market and take advantage of opportunities. Always keep the purpose in mind: If I need money quickly to secure favourable purchasing conditions, contacting creditshelf is absolutely worth your while. If you need long-term sales financing given fluctuating sales, factoring is the right choice. Again, a call to creditshelf is well worth it. thank you, mr. Heller, for your assessment and your outlook.

Rating

financing options from an SmE point of view The higher the financing costs and the lower the rating, the more interesting alternative corporate financing becomes. In the worst case, the use of equity is the only way out.

A Banks Uncollateralised

BBB

Banks Collateralised

Banks Uncollateralised

Banks Collateralised

creditshelf

Finetrading

4%-11%

12%-20%

B 1%-4%

4%-7%

A view of the market

Supplier credit

20%-25%

Equity

> 25%

Financing costs 11

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Edition 1 / 2019 â€¢ creditshelf

A human being through and through Young, female and blond. If there is an entrepreneur who could tell you a thing or two about the stereotyped thinking in an industry dominated by men, then it is Melanie Baum. Despite all the clichés and reservations, she convinced her environment with her achievements. Today, she is Managing Director and owner of the midsized company Baum Zerspanungstechnik in Marl near Recklinghausen. Although the path there was anything but easy, it was worthwhile from today’s perspective. Are you curious about her history and do you want to know what her recipe for success is? Legitimate question. In the eyes of Melanie Baum, several ingredients are key here. Particularly one of them should not be underestimated by entrepreneurs… Preferably each and every one For young Melanie Baum, it was an impossible task to limit herself to five guests at her birthday party. “If it had been up to me, I would have invited a lot more people”, says the 34-year14

Edition 1 / 2019 • creditshelf

old today. If not in her childhood, many years later her dream has come true. Instead of many birthday guests, it is now her employees who surround Melanie Braun every day. For five years now, she has been managing the midsized company Baum Zerspanungstechnik. “I’ve always been interested in people and, to this very day, have kept the ability to get involved with different characters. I would even go so far as to say that this constitutes the core of my being as an entrepreneur. I just love to meet new people and always find a way to connect with them. For dealing with my employees, customers, partners and suppliers, that’s not such a bad thing”, she says, smiling. “Things get exciting when we need a crane” The company is specialised in providing various services in the field of machining. For 35 years now, the team of 60 has been manufacturing single parts and small series for a total of 20 industry target groups with the help of turning, milling and drilling techniques. The targeted industries include food technology, the packag-

From real life

ing industry, special machine construction and recycling technology. “Although we use stateof-the-art equipment and technologies, we still place great value on the manufacturing work of our skilled employees”, Managing Director Melanie Baum underscores. At times in which many industrial enterprises rely on automation technology in order to manage high order volumes, this may sound a bit risky. But what you should know: Baum Zerspanungstechnik specially produces individual and sophisticated single parts and small series. “It just so happens that one part weighs up to 16 tons. You need a crane to make it ready for transport to the customer. That is then the point when it gets really exciting.” Exciting as the history of the family company: Founded as a one-man business under the name of “Hans-Peter Baum Maschinenbau” in a workshop of 200 square metres, by and by new employees were hired and state-of-the-art machinery was purchased, certifications obtained, partnerships built out, and process optimisation was carried out. “We had healthy growth. On average, one

employee and one machine were added every year”, the entrepreneur explains. She took the company over from her father Hans-Peter in 2016. The succession within the family was not a matter of course for both sides. The world economic crisis upset plans Melanie Baum explains: “My father did not force me to take over in any way. Although it suggested itself since I’d been helping at the factory in various positions ever since I was 15, he always told me I’d have to find my own way.” And that she did. After graduating from high school, she completed an apprenticeship as a design assistant but quickly realised she wasn’t cut out for the advertising industry. A stay abroad was to bring clarity on her professional future. After her return, she embarked on a course of studies – not mechanical engineering as many might think because of the thematic proximity to the family business. Her father had talked her out of it. Instead, she majored in business administration, communication sciences and sociology, subjects that would pave her way From real life

“Employees, that is human beings, are not the means to earn money with your company. Money is just the means, human beings are the end.” Melanie Baum, Managing Director and owner, Baum Zerspanungstechnik e.K.

towards the profession of business consultant. She sent out initial applications. But the global economic crisis upset all well-thought out plans. One look was enough “Even shortly before the global economic crisis, my father delighted over the substantial growth of his business. There were so many customer requests that it was sometimes impossible to meet them all. So he invested heavily in new staff, production space and machinery”, Melanie Baum remembers. “The far-reaching consequences of the financial crisis hit us out of the blue. We had our wings pretty drastically clipped. My father saw no other way out. During this difficult time, he needed a trustworthy person at his side and, in 2009, he finally asked me to help him out awhile.” They agreed on two years in total, during which Melanie Baum was to provide support in questions of strategy. The idea was that, after that period, it should be decided whether the Baum daughter would stay with the company. “From the very beginning, I enjoyed it immensely. I became familiar with all areas and core processes and was able to apply my knowledge and ideas garnered during my studies. I helped in optimising personnel management, provided ideas for the establishment of a management level and advanced Marketing and Sales. My father, rather the technician, and I, better in all structural and commercial matters, complemented each other excellently.” When the two years had lapsed, a quick glance between Melanie and her father was enough. There was no longer any question for her having to take up the succession. In 2014, Melanie Baum joined the management; in 2016, the company was officially handed over to her. The change at the helm was well received by employees, business partners and customers.

Her father stayed in the background, encouraging her to realise her own ideas and letting her leave her mark on the company. One of the projects that was close to her heart was the development of a new corporate culture. From their point of view, it should move from being fairly hierarchical to being more open. HR developer and philanthropist To be on equal footing with the boss and be even allowed to criticise him without punishment. Old-school managers probably don’t want to hear about it but for the young entrepreneur Melanie Baum, it constitutes part of her vision. “I want to offer good jobs. For me, human resources is neither a cost centre nor a tool to earn money. Instead, I see my employees as people with individual needs and potentials that must be used in the best way possible and promoted as well, underscores entrepreneur, who likes travelling. She doesn’t even dream of replacing them by robots. Skilled workers are a rare commodity, and you have to make an effort to get and keep them.

This is why the collaboration with schools as well as regular training and further training are part and parcel of the North Rhine-Westphalian company’s human resources policy. “I make an exception for myself, because I, too, am still learning and I depend on the experience of my employees. I therefore expressly welcome any form of criticism and ideas for improvement.” The human being takes centre stage, and the constructive exchange of ideas forms an integral part of corporate culture: By the way: The 34-year-old entrepreneur applies this principle not only to her employees but also to her collaboration with customers, suppliers and business partners. She adds: “I don’t think onesided profit is the be-all and end-all. I always ask myself how all parties involved can share in the profit made. And I’m not just referring to the monetary aspect.” Network pays off Feeling that you’re in good hands and getting the best out of any collaboration. This is what Richard Heller wants to convey to customers in his day-to-day work. He is the senior account

"‘How will we both do well here?’ That’s the question I always pose to myself – when dealing with employees, with customers and with business partners.” Melanie Baum, Managing Director and owner, Baum Zerspanungstechnik e.K.:

Edition 1 / 2019 • creditshelf

From real life

Companies that are geared to growth and values such as Baum Zerspanungstechnik are the ones to shape the SME sector in the future. We at creditshelf are committed and dedicated to this goal.” Richard Heller, Head of Corporate Customers, creditshelf Aktiengesellschaft

manager at creditshelf and was responsible for the financing request from Melanie Baum. Her joyful, positive way and her keen entrepreneurial spirit impressed him on a personal level during their first meeting in August 2018. For Melanie Baum, it was important to have a personal encounter with the account manager from creditshelf before any collaboration took a specific form. “I can only applaud such business conduct”, says Richard Heller. “After all, personal care – literally and figuratively – is an important aspect of creditshelf’s corporate philosophy.” So is the establishment and advancement of a comprehensive creditshelf network of entrepreneurs, investors and partners. This was ultimately the reason for the meeting between Melanie Baum and the 28-year-old account manager. “Baum Zerspanungstechnik was presented to us by the consultant Martin Kuklinski, who works for AMB Aktive Management Beratung. He gave us the information that Melanie Baum was looking for a partner for a traditional financing for equipment”, recounts Richard Heller and adds: “AMB and we have been working together for quite a while.

It’s nice to see what can arise from a trusting partnership. Who knows whether we would otherwise have come to the attention of Ms Braun.” Not competition but, instead, a supplementary part “In retrospect, creditshelf was exactly the piece of the puzzle that was missing for me in terms of an optimal financing mix”, says the 34-yearold entrepreneur happily. “In the case of capital requirements in the form of long-term credit financing, our partner banks had always been the first choice. I don’t want to dispense with that in the future either.” But to ensure 100% financial security at all times, the machining company relies on additional, alternative financing solutions such as factoring. “For us as a supplier of goods with long payment terms, it’s a must-have”, says the entrepreneur. What was missing was a second provider of shortto medium-term loans at favourable terms. She found such a provider in creditshelf. The digital financial backer for SMEs not only turned out to be the one that was able to deliver the From real life

EUR 100,000 needed at the time in the most agile, quick and uncomplicated way. The trust level and the direct contact with account manager Richard Heller also make a monumental contribution to convincing her that she made the right choice. “Beyond the bare figures, he showed a sincere interest, took a lot of time to collect in-depth knowledge of the company and the people behind it. I really appreciate this kind of conduct, which I strive to live myself in everyday business.” “That exactly is our goal” In the eyes of Richard Heller, such experienced and courageous entrepreneurs are the ones the small firm sector needs. For them to succeed, creditshelf offers its assistance. With regard to Melanie Braun, in particular, he has a clear opinion: “She is very innovative, forwardlooking and aware of her niche position. She understands what employee and customer loyalty means and stands behind her values. I’m not surprised that she and her employees are so delighted over such a solid order backlog. I’m certain the company will continue to be successful.” Indeed, Director Baum looks into the future with great confidence. For her, an unambiguous “yes” to growth does not mean she will expand disproportionately, though. Quality, not quantity, is the motto. The experience from the global economic crisis in 2008 serves as a warning. What we learn from history: Human resources development and appreciation are among the key success factors of a company, especially for manufacturing firms such as Baum Zerspanungstechnik. Securing liquidity is a concern that haunts all entrepreneurs, though. For Melanie Baum, these worries are over for the time being. As an added ingredient to her financing mix, creditshelf has certainly something to do with it. 17

Augmented intelligence How human and machine come to think together and thus achieve better results more quickly

Ms. Bejtovic, what does “augmented intelligence” mean to you? Bejtovic: As the term literally suggests, augmented intelligence, in short: AI, is the combination of human and artificial intelligence. Intelligent algorithms are used in order to prepare human decisions. Thus augmented intelligence means the combination of human creativity and interpretation capability with the computing power of computers – with human beings as analysts being of vital importance for the end result. Where is AI used in the global economy? Bejtovic: In fact, absolutely everywhere where very large amounts of data need to be processed. The most well-known example of an application is Pokémon Go. Professional applications also already used augmented intelligence, however, e.g. Volvo, where it is predicted when parts will fail or vehicles need to be maintained with the aid of AI. creditshelf also uses AI. Where exactly? Bejtovic: We use algorithms in the financial analysis of company figures, for example. The software that was developed by us evaluates the business figures of the last three years as well as the ongoing fiscal year, identifies historical trends and, based on all that, prepares a forecast. Experi-

enced analysts and corporate account managers receive this information in the form of meaningful graphics, whereupon they discuss the results of the analysis with the persons responsible at the companies. They ask about plans, new developments or current orders – i.e. all those factors that can only be clearly identified in a one-to-one talk. This additional information is then integrated into the forecast model so viable conclusions can be drawn. Are there other fields of application at your company? Bejtovic: Yes, we also use AI in order to be able to understand complex structures and dependencies. From the list of accounts receivable and accounts payable, our intelligent algorithms work out a size ranking and, if applicable, the display of the network of relationships. Market and industry data, news and trends in the global or regional market are also incorporated. The human analysts can then see in the evaluation where there are risks and opportunities for the company. This must involve huge amounts of data. How do you keep track? Bejtovic: That’s exactly what requires some expertise when dealing with augmented intelligence: Don’t let the amount of data become too large. This is why we continuously develop models with which optimal key words can be found for the search for market and industry data, news and trends so as to come to an ideal level in terms of the amount of data. On the one hand, the data must be meaningful; on the other hand, the amount of data should not get too large in order still to allow quick decisions.

Edition 1 / 2019 • creditshelf

Credit limit

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Week 18

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HISTORY LIQUIDITY

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In an interview, Zorana Bejtovic of creditshelf explains the role augmented intelligence already plays today in the global economy and in lending. The graduate in Business Administration completed her master’s degree in finance and is now working as a credit risk analyst for the financial backer for SMEs.

A glimpse behind the scenes

How finely can the results of the automated analysis be adjusted?

Profit and sales development

Bejtovic: We have written our algorithms in such a way that we can easily identify seasonal business models, for instance. Because it is our ambition to analyse and understand the business of our customers as accurately and comprehensibly as possible. Once we know how the requirements for working capital will develop over the course of the year, we can tailor the loan optimally to the business. Secondly, we can give recommendations for the future development of the company. Finally, in the context of the financial analysis, our customers receive the financial report generated from their data.

Profit

Confidence

Sales

As a conclusion: What benefits do your customers get from augmented intelligence? Bejtovic: Once companies have provided us with their accounting data in digital form, the data is evaluated in a very short time by the intelligent algorithms. Analysts and account managers quickly have the well-founded results in their hands. Thanks to this approach, we at creditshelf can very quickly come to a decision on a credit request. The automatic evaluation by means of augmented intelligence does away with the operational risk of manual data entry, which was a common problem in the financial world up until recently. With augmented intelligence â€“ i.e. the interacting of human intelligence and interpretation ability with intelligent algorithms â€“ we are able to make

Profit

Sales

Forecast

Confidence

informed credit decisions within a very short period of time. The decisions are based on solid data, common sense and a comprehensive market analysis. We communicate the results of our work openly and transparently to our customers. In this way, we create trust and lay the foundation for a long-term partnership. Thank you, Ms. Bejtovic, for this deep insight into the processes at creditshelf.

Our offer:

Liquidity inflow through the purchase of your machines while you continue to use them (sale & lease back)

Independent of banks and creditworthiness

Improve balance sheet figures and thus your rating

Realise extraordinary income by raising hidden reserves

Financial security for special situations? We offer it to you! Maturus Finance GmbH T +49 40 3003936-250 info@maturus.com

A glimpse behind the scenes

www.maturus.com

New Work Corporate culture sets the course for a digital transformation Interview with Fabian Kienbaum, Chief Empowerment Officer, Kienbaum Consultants International

Digitisation is changing our society rapidly and is transforming practically all areas of life. Although it offers great opportunities for a better quality of life and new business models, small and medium-sized enterprises are confronted with new strategic challenges as well. There is no longer any getting around it: Anybody wanting to continue to operate successfully on the market must set the course for digital transformation. Fabian Kienbaum, CEO of Kienbaum Consultants International, warns against relying solely on new technologies alone. In his view, the corporate culture makes a significant contribution to a successful transition. In the following interview, he provides answers to the questions of what the term “New Work” means in this context and how it affects the working environment of companies today and in the future. What does the term “New Work” stand for and to what extent does it affect our working environment? Kienbaum: The Industrial Revolution, with its meticulous division of labour, clear hierarchies and structures, has shaped the classical image of standardised work. The digital age now chal20

lenges this way of working. Because: People’s own ideas and desires as well as empowerment are gaining more and more in importance. The zeitgeist is characterised by individualisation, and the working world is confronted with new challenges and changes. Many managers are currently experiencing this in particular: Everything that has stood the test of time over many years and has been accepted by most employees is suddenly being questioned. Status, salary and title are losing their significance; at the same time, they remain quite important as hygiene factors in cross-comparisons. At the same time, the focus is increasingly on soft factors such as the compatibility of family and career, flexible working hours, transparency and communication on an equal footing. All in all, New Work is about the question of how we can guarantee agility, flexibility, serving leadership, individuality and aesthetic office architecture in the working world of tomorrow in an intelligent mix. I personally now prefer to use the term Fair Work instead of New Work. How can companies respond to the transformation, and what are the potential starting points? Kienbaum: Last year, we conducted a survey, Edition 1 / 2019 • creditshelf

from which we came to the conclusion that around three- quarters of German companies are actively looking into the concept of New Work — sometimes without knowing exactly what it means. That’s not really bad because every company must find its own individual path within the dimensions described above; there are no standard solutions for New Work. In principle, it is not even anything new because the form of management was and is the linchpin to it all – and thus the role of the managers is of paramount importance. If they really mean it, managers must primarily answer one question for the employees: Why do we do what we do, and what do we stand for or want to stand for? Ultimately, the attractiveness of the company in terms of both customers and employees is derived from this. It is therefore necessary to emphasise the meaning and thus underscore its credibility and attitude in a world marked by transparency. Very often these changes rightfully go hand-in-hand with cultural change projects, because many people deep down want another form of dealing with one another in their working life. The digital transformation is ultimately a social transformation: it is firstly about human beings, only secondly about technology. It is really crucial

Stimuli

Fabian Kienbaum

to internalise this. If I built an honest, sincere relationship with my fellow human beings, the solutions in terms of New Work will follow automatically. What should executives define as their primary goals in this context? Kienbaum: Executives must engage with this paradigm shift, realise how important their role is for the employees and personify corporate values. It’s not always easy but it is doable. After all, the role of managers is not becoming – as is sometimes incorrectly rumoured – less important but, on the contrary, more important. As banal as it sounds: People like to follow other people with their hearts and minds who are not free of faults and are capable of laughing at themselves. We all crave more humanness again – and that is as it should be! How would you describe the role of managers? Kienbaum: The role model of managers is in the process of changing. Instead of patriarchs, moderators are in demand today, who communicate with their employees on an equal footing. The goal is to bring them together with

suitable projects, topics and teams, to instil enthusiasm in them and convey meaning. This includes the ability to pull yourself back and let qualified employees do their thing within a defined framework. That is the right approach in order to give in equal measure more orientation, security and inspiration to your own employees, something that is absolutely crucial in an increasingly complex world. Would you dare to glimpse into the future for us, please: Will the term “New Work” turn out as nothing more than a catchword in the future; or will New Work actually come to SMEs in Germany? Kienbaum: I firmly belie we’re experiencing a movement that is spreading and will therefore change the working world in the long term. And there are already a lot of companies in which New Work, Fair Work or whatever we want to call it works quite well in all its different aspects thanks to a working environment where a culture of trust has been implemented and lived. It’s not just called that in these cases but reflects the self-image of many family-run small or mid-sized enterprises. A healthy corporate culture is the key to sustainable value development and innovation. And given the increasing pressure for digitisation and change, CEOs and executives will have a hard time refusing the development of such a culture. Stimuli

Fabian Kienbaum is CEO of Kienbaum Consultants International He took over the renowned human resources and management consultancy firm from his father in 2018 and carries on the business of the top consultancy firm of the Federal Republic in the third generation. His grandfather, at the age of 26, had founded it at the end of the war in 1945 in Gummersbach. Fabian Kienbaum is a former player in the German Handball League. Since he took over the helm of the Group, he has dedicated himself especially to its digital development and has launched an investment vehicle with which Kienbaum invests in HR tech start-ups.

Kienbaum Consultants International The family-run partnership company has been around for over 70 years. The human resources and management consultancy firm Kienbaum Consultants International GmbH, headquartered in Cologne, is the operational parent company of the Kienbaum Group. The longestablished consultancy firm is active in the business fields of Executive Search, Human Capital Services as well as change and organisational consultancy. It is represented in 18 countries on four continents and generates a revenue of around EUR 100 million.

Your oPinion, dear influencers? What drives SmEs and investors If there’s one thing we love, it’s discourse! Especially on topics that drive SmEs. And who shares this passion more than our inﬂuencers? that’s exactly why again in this issue we will present their opinions on the stock market, the market, finance and more....

Isabelle Hägewald, Editor-in-Chief and CEO, mein Geld medien Gruppe

Anja U. Kraus, Editor, “die bank – Zeitschrift für bankpolitik und Praxis”

ms. Hägewald, what does the equity culture in Germany look like?

If you look at the development over the last few years, the answer can only be: on banks AND FinTechs! A collision of interests in the start-up phase has left room for a fruitful co-existence. Hybrids such as Main Incubator or Digital Factory prove that the established banks are not lagging behind the development but drive innovations themselves. The trendy platform banking is also not conceivable without cooperation. Positive for the customer: He gets the best of both worlds.

In principle, the Germans must deal with the topic of “money” in a more serious manner. As editors, we have found time and again that compared with other countries, people in Germany are insufficiently informed about the topic of “investment”. This results in a disastrous equity culture because out of fear or lack of knowledge, many different investment options are simply not used. Instead, the wrong investments are made or none made at all. Providing information on the basic concepts of investing already at school might help. This way, a basic knowledge about equities, saving accounts and bonds could be established. In addition, training offers both for young people and adults would have a positive impact on the investment behaviour of the Germans.

Read more at: www.iif-potsdam.de

Stimuli

Knowledge transfer and dialogue

No matter how fast or comfortable our business model is for SMEs – all topics concerning finance, banking and capital procurement are and will always remain a matter of trust. And therefore one-on-one talks have at least the same high priority for us as the digital, automated processes. So let’s seize the opportunity and get to know one another at all sorts of events. We will exchange ideas on trends, show you design options of digital SME financing and we’ll find the right solution for your funding needs! We’re looking forward to a face-to-face contact with you! Live on site in your area or by webinar? You decide! More information and bookings at: www.creditshelf.com/de/events

Events with creditshelf as the (co-) organiser

Investor Relations Events

Finanz-Talk: Digitale Mittelstandsfinanzierung (Finance Talk: Digital SME Financing)

In July 2018, creditshelf had a successful IPO. Are you an investor and want to get acquainted with us? Here you will find an overview of the coming Investor Relations Events:

The market for SME financing in Germany is in a state of upheaval: Several recent studies have examined the situation of the banks in the corporate customer segment and have reached a conclusion that comes as no surprise to anyone: German banks’ business with corporate customers is under pressure. For well-nigh one-half of the bank units analysed, the result after capital cost is negative. At the same time, new “digital” FinTech players are making an appearance on the market that try to win over companies especially by being substantially faster and by lean processes. With this, they act as a useful addition to the financing mix. In the context of our event series “FINANZ-TALK: Digitale Mittelstandsfinanzierung”, we offer you the opportunity for gathering information on the latest trends and developments and to engage in dialogue with experts from the field. [[ Flight 1:

[[ Flight 2:

 • Münchner Kapitalmarktkonferenz (Munich Capital Market Conference), 7-8 May 2019

• DFVA Spring Conference, Frankfurt/Main, 13-15 May 2019 • General Meeting, Frankfurt/Main, 14 May 2019 • Quarterly reporting for the 1st quarter, 28 May 2019 • Prior Kapitalmarktkonferenz (Prior Capital Market Conference), Dreieich-Götzenheim, 4 June 2019 • Commerzbank Small & Mid Cap Conference, Frankfurt/Main, 29 August 2019 • DFVA Herbstkonferenz (Autumn Conference), Frankfurt/Main, 2-3 Sept. 2019 • Deutsches Eigenkapitalforum (German Equity Forum), Frankfurt/Main, 25-27 May 2019

• Hamburg, 22 May 2019

• Hamburg, 25 Sept. 2019

• Berlin, 23 May 2019

• Berlin, 26 Sept. 2019

• Stuttgart, 5 June 2019

• Stuttgart, 16 Oct. 2019

Equity Lounge

• Munich, 6 June 2019

• Munich, 17 Oct. 2019

• Düsseldorf, 19 June 2019

• Düsseldorf, 6 Nov. 2019

• Frankfurt/Main, 27 June 2019

• Frankfurt/Main, 7 Nov. 2019

We would also like to invite you to the “Equity Lounge” network event held by the consultancy firm Dr. Wieselhuber & Partner GmbH on a regular basis.  • Panorama Lounge, Munich, 21 March 2019

Morning Meetup

• Oosten, Frankfurt/Main, 3 April 2019

Alternative forms of financing such as crowdfunding, (online) direct lending, factoring, finetrading or mezzanine financing are increasingly gaining in importance and thus changing the financing projects of German small and mid-sized companies. Innovative FinTechs are more and more in demand and act as a useful supplement to conventional banks.

• Hyatt Hafen, Düsseldorf, 22 May 2019

In our series of events, we offer you the opportunity of getting to talk to representatives of various financing areas. Organisers: creditshelf, Wieselhuber & Partner, Patrimonium  • Frankfurt/Main, 7 May 2019 • Munich, 11 Sept. 2019 • Hamburg, 19 Nov. 2019

• Alsterlounge, Hamburg, 6 June 2019

External events We take part in these events as guest speakers, contributors and partners. Maybe we’ll find an opportunity for a one-on-one discussion here as well? Mark down the following dates in your calendar:  • Digital Growth Forum 2019, Frankfurt/Main, 9 April 2019 • Family Entrepreneur Day, Nuremberg, 24-25 May 2019 • 42. German Tax Consultant Day 2019, Berlin, 20-22 Oct. 2019

Edition 1 / 2019 • creditshelf

Dates

Webinars creditshelf webinar “SME financing – new opportunities!” If you are unable to attend the aforementioned dates but are interested in the opportunities creditshelf is offering, you can make use of our new webinar offering. Richard Heller, Head of Corporate Customers, explains step by step how you can obtain a corporate loan quickly and conveniently. What do you have to submit? What follows then? How quickly will you learn if creditshelf will grant you a loan? Find out here! Online registration for the webinar at: www.creditshelf.com

Trade fairs

You’ll find the first dates here:

How will small and medium-sized enterprises cover their financing needs in the future? What are the advantages of FinTechs in this context? How does fast, uncomplicated and digital credit brokering via creditshelf work? What can creditshelf do to make you successful? Visit us at our booth at the following trade fairs. We promise: Together, we will find the answers to your questions.

 • Tuesday, 26 March 2019 • Thursday, 6 June 2019 • Friday, 27 Sept. 2019

Convent Mittelstandstage (Convent SME Days): nationwide series of events

What you should not miss: Familien-Unternehmertag (Family Entrepreneur Day) 2019 of Weissman Group in Nuremberg

The “Convent Mittelstandstage” are part of a nationwide series of events that has been implemented at German economic hubs for almost 20 years. creditshelf is a sponsor. Managing directors and board members as well as decision-makers in small and mid-sized, owner-managed firms with a turnover of between EUR 5 and EUR 150 million are cordially invited. Are you interested? Then don’t miss any of the broad range of opportunities:

How do I define my success as an entrepreneur: Success is always the result of self-created inputs. Especially in a volatile working environment with fierce challenges, success needs a clear goal for all employees to pursue. In order to hold one’s own in future competition, family businesses need a clearly defined and implementable strategy as a basis and an agile organisation in the implementation process. Highly motivated and qualified employees, stability and security are vital cultural factors of success in the entrepreneurial family. If you want to be successful, you must assume responsibility – for yourself and for the activities of the company as a whole.

 • 15th Norddeutscher Unternehmertag (North German Entrepreneur Congress), Hamburg, 28 May 2019 • 4. Mittelstandsforum Nordrhein-Westfalen (SME Forum North Rhine-Westphalia), Düsseldorf, 16 June 2019 • 16. Mittelstandsforum Baden-Württemberg (SME Forum Baden-Württemberg), Stuttgart, 25 July 2019 • 18. Mittelstandstag FrankfurtRheinMain (SME Congress FrankfurtRheinMain), Frankfurt/Main, 5 Nov. 2019

Let yourself be inspired: We recommend visiting the Family Entrepreneur Day on 24-25 May 2019 in Nuremberg!

• 16. Mitteldeutscher Unternehmertag (Central German Entrepreneur Congress), Leipzig, 2 Dec. 2019

You can gain insights there into personal success stories and trend-setting conceptual ideas from family businesses. Seize the opportunity of collecting new ideas for your success and compare your own experience with that of other entrepreneurs.

15. “Structured Finance” congress Would you like to take a look behind the scenes and benefit from the experience of others? Then we recommend the “Structured Finance” congress that takes place every year. Financial managers of major SMEs and listed companies provide insights into their work. We are among these CFOs, Treasury heads, bankers and selected financial service providers! Where:

Internationales Congresscenter Stuttgart, Messepiazza 1, 70629 Stuttgart

When:

27-28 Nov. 2019

Where:

Schindlerhof Nuremberg Steinacher Str. 6-10, 90427 Nuremberg

When:

24 May 2019 from 1:00 p.m. and 25 May 2019 from 1:30 p.m.

More information and bookings at: www.weissman.de/institut/veranstaltungen/ familien-unternehmertag-2019/

Dates

WORKING TOGETHER FOR A STRONG MITTElSTANd. BVMW

900,000 voices united for the SME sector. 32 strong partners in the SME alliance. 300 offices nationwide. 40 agencies in countries all over the world. Over 2,000 events for entrepreneurs every year.

BECOME A MEMBER NOW! 26

Edition 1 / 2019 Ad â€¢ creditshelf

www.bvmw.de

Cooperation projects

end of odYsseY Amb and creditshelf end capital odyssey When small and medium-sized companies needed money at that time, a stressful odyssey began for CEOs and financial officers. PCs or an electronic calculation tool like Excel did not exist. balance sheets and financial statements were carried to the principal bank in paper form. the bank checked all data in a time-consuming way, asked questions and checked again. In the meantime, the entrepreneur sometimes waited for months, hoping that the funds would be provided. In 1991, that was still the usual way and the starting point for founding Amb Aktive management beratung GmbH in Essen, today headquartered in bottrop and active throughout Germany. turning a shortcoming into a business “At that time, we realised over and over again that essential financial knowledge simply did not exist in SMEs”, Joachim Aschenbruck remembers. He is co-founder and Managing Director of the consultancy firm. “We support small and mid-sized companies in tackling the challenge of generating capital – a bit like an outsourced Finance Department”, Joachim Aschenbruck adds. As the first letter in the name of the firm suggests, the consultants of AMB immersed themselves actively in the

business models of their clients. With objective expertise, they obtain a detailed overview. The consultants create the necessary transparency – internally, in relation to the entrepreneur, and externally, in relation to investors. The demand, the strategies and the sometimes complex payment modalities become more clear. With this information, the investors are also on the safe side because they now understand better what is to be funded and for what reason. tailored funding for a variety of reasons “Our goal is to open up new opportunities for companies with liquidity”, says Martin Kuklinski, partner and Managing Director of AMB. Companies always have occasions calling for financing. After the financial crisis of 2008, the supply of credit to small and mid-sized businesses became more difficult given tightened regulations and the increasingly risk-averse behaviour of commercial banks. In view of these problems, expansion-oriented companies came to ABM more and more. In addition, special situations into which companies have gotten themselves must be mastered with creative solutions and quick decisions. Requirements that a principal bank does not meet due to long-winded processes and keen security thinking. “When looking for an alternative financing partner for our

Edition Cooperation 1 / 2019 •projects creditshelf

clients, we soon discovered creditshelf”, says Martin Kuklinski. Highly committed, constantly giving their best and equipped with lean processes – these are standards both companies represent. If you ask the clients, they actually fulfil them. Competitive advantage through ﬂexibility and speed Together with creditshelf, ABM up to now has provided two companies with short-term capital. Case 1: A medium-sized bakery with 30 sites wanted to continue to grow. The foreign bank previously providing capital didn’t go along with it. Case 2: An owner-managed software and consulting company was quite successful on the market and wanted to expand. Both companies received the necessary liquidity for their projects via creditshelf, which in the meantime has already flowed back to the financial backer. Success on all sides. “FinTechs such as creditshelf have gained a competitive edge with speed and the willingness to cover short-term and volatile capital needs”, Martin Kuklinski sums up. Companies that take advantage of this offer are no longer exposed to a stressful odyssey when they want to generate fresh capital. 27

Offerer of opportunities, driver of innovation and cooperation partner Why doubts and fear of FinTechs are unfounded Nothing lasts forever. Even Nokia, once the most valuable company in Europe, felt the effects after the turn of the millennium. The mobile telephone giant dominated the global business in mobile phones and was valued at EUR 250 billion on the stock exchange in 2007. A few years later, the core business was sold for EUR 5.4 billion. What happened? New competitors, the shift in customer preferences and innovative products had turned the market upside down – and steam-rolled Nokia. A study conducted by Dr. Mark Mietzner of Zeppelin University in Friedrichshafen examined whether a similar fate awaits banks due to the emerging FinTech scene. In his opinion, banks can breathe a sigh of relief – but only under certain preconditions. Read here what they are and what SMEs can look forward to in this phase of radical change. Change requires rethinking Lehman Brothers, the financial crisis and Basel. If you ask banking executives about the reasons for the situation banks are in today, they’ll nearly always answer with one of these three buzzwords. It’s only half the truth, though. Because it’s also due to the digital transformation that has

“Banks are still the most important funding instrument for SMEs.” Dr. Mark Mietzner, Chair of Banking and Finance, Zeppelin University

Edition 1 / 2019 • creditshelf

called for completely new business models, products and services to emerge in the financial sector. Banks had a hard time keeping abreast of these rapid developments. Platform-based FinTechs and their technologies certainly did. According to McKinsey, it’s their market entry that will have a significant impact on the well-established financial institutions until 2025. In figures: Sales slumps of 10 to 40 percent and profit losses of 20 to 60 percent. What at first sounds not so great for the banks is good news for the managing directors of mid-sized companies. After all, the growing range of offers on the financing market gives them significantly more negotiating power. The fact that German companies have been actively looking for complementary capital providers and models for several years, not just since yesterday, is shown by the development of their financing structure. Dr. Mietzner and his research team traced this development by means of the analysis of extrapolated balance sheet and income data. Bank loans are still in first place but are on the decline In the case of small and medium-sized enterprises, the bank is traditionally the most important financial instrument: A total of 36 to 46 percent of the liabilities are to banks. At around EUR 490 billion in 2016, the volume of loans projected in the study is still quite high. Over time, however, a declining trend can be observed since 1997: According to this, the proportion of liabilities to banks in the total capital fell from 36.8 percent to 22.6 percent; since 2013, its total is even behind the equity share. If you listen to statements from entrepreneurs, the decline is due to the difficult access to loans on account of stricter regulations. Statistics and data from the German Federal Bank, however, refute this argument and even point to a significant easing and greater scope for negotiation in the context of lending. Among other things, this can be seen from the decline in collateralised loans. Their share fell from 20.9 percent to 14.7 percent in the period from 2010 to 2017. Apparently, the banks relinquished the collateralisation of their commitments despite the greater risk of loss in the event of a company insolvency. Mietzner interprets this as evidence of the growing independence of the SMEs from banks.

trends fintechs have recognised the demand Entrepreneurs have put their financing mix on a broad basis and rely more and more on internal financing as well as on alternative models such as factoring. The factoring market alone – with a total volume of EUR 232.4 billion in 2017 – shows that alternative financing solutions and partners have long since arrived in the SME segment. Access to liquidity should be as convenient, easy and fast as possible. The business models and technologies of FinTechs put the focus right on this aspect. Owing to their automated, efficient and transparent settlement processes, they are becoming more and more attractive to entrepreneurs. Winners on all sides. In the opinion of Mark Mietzner, the established banks should rethink their current business model and be willing, from a strategic point of view, to cooperate with FinTechs. Decision-makers should not shake their heads at this point, especially in view of the current market potential for FinTechs and the high volume of loans brokered by FinTechs. creditshelf, for example, recently reached a new milestone in the lending business: In 2018 alone, credit requests in the amount of EUR 1 billion were processed at this pioneer in digital SME financing. Since the commencement of business activities, short-term and medium-term loans with a total volume of more than EUR 100 million for German SMEs were arranged by creditshelf. An end to this growth is not in sight. So – is it a yes or no to cooperation between banks and FinTechs? The answer is: Yes. Banks will be enabled to lower marginal costs, increase their productivity, adapt innovative technologies and provide services they don’t want to offer themselves. Advantages all along the line that will prevent a fate à la Nokia. You’ll find the complete paper on the study at: www.zu.de.

“Entrepreneurs need convenient, easy and quick access to capital. With their business model, FinTechs have adapted to the needs of small and medium-sized businesses and are becoming more and more attractive due to their automated, efficient and transparent settlement processes.” dr. mark mietzner, Chair of banking and finance, Zeppelin University

bASIC InfORmAtIOn On tHE ZEPPELIn StUdY: y Title of study: Die globale FinTech-Revolution: eine Chance für KMUs? (The Global FinTech Revolution: An Opportunity for SMEs) y Management: Dr. Mark Mietzner, Zeppelin University y Databases: Corporate accounts statistics of the German Federal Bank and Dafne database provided by Bureau van Dijk

You’ll find the complete paper on the study at: www.zu.de.

y Duration of the survey: 1997 to 2016

100

% of the balance sheet total

development of the financing structure of German SmEs

80 70

Companies with sales of under EUR 50 million are included in the group of small and medium-sized companies.

60 50 40 30

Source: Own calculation on the basis of corporate accounts statistics of the German Federal Bank, projected company accounts from 1997 to 2015, as at December 2017.

20 10 0

1997

1998

Equity

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Bank loans

Other liabilities

Provisions Trends

2011

2012

2013

2014

2015

Prepaid expenses 29

creditshelf at a glance Loan amounts Kreditbeträge from €100,000bisto ab 100.000€ €5,000,000 5.000.000€

Fast ﬁnancing with Schnelle Finanzierung maturities of upbis to zu 60 mit Laufzeiten 60months Monaten

Quick andund easy Schnelle einfache digital request digitalecredit Kreditanfrage

Response Rückmeldung within 48 hours innerhalb 48 Stunden

Experienced Erfahrene top experts Top-Experten

Personal andund Persönlicher individual service individueller Service

Qualified Kompetente advice Beratung

Maximum Maximale data security Datensicherheit

Broaden your Verbreiterung Ihrer ﬁnancing basis Finanzierungsbasis

our UNSER offer ANGEBOT for FÜR You SIE

Our financing guidelines Financing solution

• • • • •

• •

Established small and medium-sized enterprises, market-proven business model, reporting company (German Commercial Code, HGB) Company history of at least 3 years Excluded sectors: Renewable energies, ships, automotive retail/repair

Financial indicators (indicative)

• • • •

Sales > EUR 2.5 million, stable or growing EBITDA > 0 Equity > 0, no negative equity creditreform score < 300

Cost

• •

Interest rates starting at 3.99% p.a. One-time fee for payment of the loan (depending on creditworthiness and industry)

Basis for decision-making

• •

Last two annual financial statements, audited or signed by GF/StB Current business assessment, including list of account balances as well as lists of accounts receivable/accounts payable (not older than 2 months) Current lists of open items Account statements for the last three months (PDF from online banking) Financial liabilities analysis

Business criteria

•

Equipment financing and acquisition financing Loan amounts from EUR 100,000 to EUR 5,000,000 Term: 1 to 60 months Repayment: final maturity (maturities of up to 12 months) or on a monthly annuity basis Usually not collateralised

• • •

TIP

If you provide us with the current business assessment and list of account balances as machine-readable PDFs (not copied but digitally created documents) or submit the GDPdU (principles of data access and auditing of digital documents) data, our analysis will be more exact and even faster. Please don’t hesitate to contact us.

Edition 1 / 2019 • creditshelf

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