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Creativity Secures Capital

NRW

Major and minor dramas all around love, jealousy and death regularly happen in the streets of Cologne. They do not create too much excitement though among the inhabitants of the Cathedral City, as most of the dramas are purely fictitious.

In Cologne, around one third of all German films and series are produced. The city is one of Germany’s most important media locations. Only a few kilometres away – in Düsseldorf – however, excitement was real when the Eurovision Song Contest, a superlative media event, took place there in May. Not far away either from the river Rhine, but more silently, the former coal mine Zeche Zollverein in Essen steadily develops into an important centre of the creative industry. It has become clear for a long time that North Rhine-Westphalia is an important media location and still has a lot of potential in this segment. And to fully develop this potential, the NRW.BANK offers various funding products for the financial requirements of creative companies.


Michael Stölting

»The media location NRW profits to a great extent from innovative small and medium-sized companies. Our numerous, custom-made offers ensure that NRW will continue to be a leader. We see ourselves as a reliable partner for companies in North Rhine-Westphalia, especially during the coming challenges for the media industry, such as digitalisation and increasing convergence.«

Michael Stölting, Director of the NRW.Bank


 

Expansion through Equity Capital

Gerrit Schumann also required capital for his plans to expand. He convinced the NRW.BANK’s investment managers and received equity capital from the NRW.BANK Creative Industry Fund: in 2006, Schumann founded Music Networx AG together with Georg Bergheim. The idea was to store live concerts on a USB stick and offer them to visitors for immediate purchase. Via an online portal, the music video from the very same concert, which the fan has just attended, is held ready for download. In late 2009, the two managing directors decided to buy the company Simfy, which offered its customers a digital music record collection on the Internet with more than 8 million songs. For the takeover and expansion, the NRW.BANK made available €7 million in equity capital from the NRW.BANK Creative Industry Fund in cooperation with other risk capital providers.

The NRW.BANK Creative Industry Fund, issued in 2009, holds funds of 30 million. Its target group are companies from the areas of film and TV, music, advertising, software, games, design, art and events. The fund makes equity capital available to both young and well-established companies of the creative sector in North Rhine-Westphalia in the form of direct minority stakes and equity-related financing forms like silent partnerships or profit-sharing rights (so-called «mezzanine capital«). In this context, funding is provided in cooperation with co-investors; the NRW.BANK Creative Industry Fund can account for a share of up to 50% in any individual financing round. The funds of up to €3 million per individual engagement are supposed to serve the financing of investments or acquisitions and co-operations. Any funding is subject to a conclusive overall business concept, a convincing team, a provable unique selling proposition and sufficient growth perspectives.

For creativity alone is mostly not enough. »Time and again, we find that many creative industry companies have too little equity capital«, says Peter Güllmann, Head of Investments at NRW.BANK. »On the one hand, this is attributable to the small-scale company structures typical of this industry, which have previously often prevented access to the capital market. On the other hand, we see that are banks sometimes quite reluctant to approve corresponding financing requests«, Mr Güllmann adds.

Small Loan for Great Ideas

Die NRW.BANK offers funding not only to large, but also to small creative companies. Especially for smaller start-up projects, the NRW.BANK offers NRW/EU micro loans for business start-ups and companies with a market presence of less than five years. Contact points are the local STARTER CENTRES NRW, which advise the founder and forward the start-up concept to the NRW.BANK. The latter can approve loans of between € 5,000 and € 25,000. Business ideas range from companies for media and event technology or an own photographic studio down to communications design offices. And should the business grow, the NRW.BANK holds ready further outside and equity capital products such as the NRW.BANK Creative Industry Fund or the NRW Innovation Loan to close possible financing gaps.


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NRW.BANK – Anstalt des öffentlichen Rechts

Düsseldorf

Kavalleriestr. 22
40213 Düsseldorf
Tel. 02 11/9 17 41-0
Fax02 11/9 17 41-1800

Münster

Friedrichstr. 1
48145 Münster
Tel. 02 51/9 17 41-0
Fax 02 51/9 17 41-2921

Email:info@nrwbank.de

Managing Board: Dietmar P. Binkowska, Klaus Neuhaus, Michael Stölting, Dietrich Suhlrie

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