Innovation and Funding - an EBRD Perspective 5G Ecosystem Forum, - - PowerPoint PPT Presentation

Innovation and Funding - an EBRD Perspective

5G Ecosystem Forum, Baltic Sea Region Riga, September 27, 2018

Jürgen Rigterink

First Vice President, EBRD

• Founded in 1991
• 69 shareholders from 5 continents
• We invest in 38 economies
• Capital base of €30bn and a triple-A rating
• Since 1991 invested >€120 billion in >5,000 projects (€9.2 billion in Poland,

€2.1 billion in the Baltics)

• 2017: €9.7 billion in 412 projects, €1.1bn of mobilized investment

About EBRD

Our Mandate

• Mandat

ate: e: furthering progress towards market-oriented economies

• Focus

us on Privat vate e Sector: r: key conduit of delivery across the full capital structure

• Po

Polic icy Connect ectivit ivity: : engagement multiplier

• Mobilis

ilisat ation ion: financial multiplier

• Market

et Pricing: ing: working with markets without market distortion

• Sector
• r Know
• wled

ledge ge & Locally ally Embedded: dded: strong sector teams 56 offices in 35 countries of operations

• Prefer

erred red Credit itor

• r Status

us: : privileges and immunities provide risk mitigation

4 4

EBRD - ICT Investments

• €4.4

.4 billion lion inves ested ed in ICT

• including

luding €3.6 .6 billion lion in telecom

• ms,

, of which: h:  €1,6 billion in mobile (36% of ICT investments)  €864 million (20% of ICT investments) in the Baltics and Poland

1,586

36% 36% 2,028 47% 224 5% 5% 538 538 12% 12%

Mobile Other Telecom Innovative Tech Other

Total tal amou

• unt

t invested vested (€m) since 1991 91 by sub-sec ector tor

5 5

Knowled ledge e Econom

• nomy Initiati

iative (2014) promotes:

• infrastructure investment - e.g. 4G/5G, fibre
• local R&D
• investment and support for early stage technology companies
• TC-funded support for national policy, legal & regulatory frameworks, capacity building

EBRD - ICT Experience and Focus

Venture Capital ital Investm estmen ent Programm amme e (2012): ):

• €200m dedicated fund
• for early stage high growth tech companies
• makes investments and brings in-house and industry expertise
• developing the local VC ecosystem

6 6

10 35 179 1991- 1997 1998-2004 2005-2011 2012-2018

1989: Public Internet Started 1993: Emails started 1994: Amazon Founded 2004: Facebook Founded 1998: Google Founded

Invest stments s in Innovative Tech chnology se segment by pe peri riod (€mn) alongsi side landmar arks s in the tech chnology re revolution

EBRD - Investment in Innovative Tech

7 7

Debt Equ quit ity y Venture ure Capital

New Technolog nology Infras astruc tructure ure

Debt Equ quit ity y Venture ure Capital

EBRD projec jects

• 87% ‘KEI’
• €700m broadband
• €200m innovative tech
• € volume → infrastructure debt
• number of projects → equity, VC

VCIP (2012) 2)

• €53m invested to date in 14 companies

EBRD - Recent ICT Experience

8 8

EBRD – ICT in the Baltic Region

9 9

EBRD – Challenges in the Baltic Region

EBRD RD Investm estment nt in ICT T

(2014-2017): ): Es Estoni

• nia - € 0

Latvia via – € 0 Lith thuan uania - € 5 million Poland nd - € 456 million

Why?

• Most advanced region (regulatory &

market reforms and knowledge economy)

• Sector is well-served by commercial

banks, equity investors, DCM and ECM But The VC ecosystem is nascent

10 10

The Nascent VC Ecosystem in the Baltic Region

• The Baltic Region lags well behind global leaders such as Israel and the US.
• Early stage companies look to Western Europe, or further afield, (e.g. US) for VC funding.

Poland nd Latvia ia Eston

• nia

ia

11 11

5G – Is it a Game Changer?

Differ erin ing views, s, but:

• Large investment amounts and long tenors (€500bn for Europe?)
• 5G economics may drive infrastructure sharing
• EU Gigabit Society 2025
• Need to develop the local VC ecosystem to support local entrepreneurial talent, to create the applications that will run on

5G broadband EBRD:

• Large ticket, long term financing for telecoms
• Tower company financing
• Debt and equity
• Supporting VC ecosystem for early stage companies through finance and expertise.
• Support for other 5G ‘Use Cases’ such as Smart Cities

12 12

• Public sector support (incentives, subsidies) required to make 5G truly widely accessible.
• The EBRD will play a multi-faceted role: financing 5G, supporting early stage tech

companies, supporting the VC ecosystem, development of smart cities.

• The EBRD is ready to play its part in the creation of a truly connected world throughout its

mandate countries. We are confident that we will play a key role in the Baltic Region too!

Final Remarks

Contacts

EBRD, One Exchange Square London, EC2A 2JN United Kingdom www.ebrd.com Find us on social media