EXECUTIVE SUMMARY

The present project analysed how VC investors can create sustainable added value for start-ups through non-financial value-added services (NFVAs). The study was grounded in comprehensive secondary analyses and primary research through qualitative interviews with 11 start-ups and 10 investors. The insights gained provide a data-based foundation for the targeted recommendation of the further development of BCII's value-add approach.

Goal

The objective of this project was to investigate how VC investors can create additional added value for their portfolio companies beyond the provision of financial support. The focus of this study is on so-called 'smart money' services, i.e. non-financial value adding services (NFVAs for short) such as mentoring, network access or operational support. Insights were gained by conducting secondary research, examining the range of services offered by other venture capital investors, and identifying the practical support needs of technology-driven start-ups and scale-ups in different growth stages. The further goal of this study was to derive well-founded recommendations for action for investors, with a view to strategically developing their support offering.

Methodology

A mix of primary and secondary research was applied. The secondary research included a review of over 85 sources. These sources were analysed to determine what services other investors provide and what services maximize ROI. The secondary research findings were then used to conduct primary research in the form of interviews (10 with investors and 11 with start-up founders, both in the DACH region). Thematic analysis was then employed to analyse the interviews, and a demand and supply analysis was created. The results of the two analyses were then compared to identify a gap. A series of strategic recommendations for refining the strategy of B&C Innovation Investment were then derived.

Results

Secondary research has already clearly demonstrated that non-financial value-added services (NFVAs) are a decisive differentiating factor in today's VC landscape. It is evident that successful NFVAs are not standardised, but rather context-specific, flexible and strongly relationship-oriented.

The primary research conducted indicated that for pre-seed and seed start-ups, the primary requirements are network access, recruitment assistance and technical expertise. In contrast, growth start-ups prioritize mentoring and sales support. Investors emphasize network and also acknowledge that different priorities are to be considered depending on the phase, such as strategic advice for larger start-ups or technical support for early-stage start-ups.

Most NFVAs offered by investors generally align with the needs of early-stage start-ups. The actual challenge is not a shortage of services; rather, it is a lack of congruence and subsequent adherence. Consequently, we advocate a shift in focus from a comprehensive array of services to a more targeted, stage-specific approach, facilitated by an NFVA lead, a tracking system, and a robust community. 

Cooperation Partner

• B&C Innovation Investments GmbH
  Universitätsring 14
  1010 Wien, Austria
  www.bcgruppe.at/innovation-investments/

Contact Person

• Katrin Kaiser

Student Team

• Viktoria Dimitrova
  Kevin Nguyen
  Daniel Do
  Simon Klaffenböck
  Larissa Goldsteiner
  Moritz Gillhuber
  Sebastian Schulz

Project Manager

• Dr. Dorothee Horvath

• Mag. Benjamin Monsorno