3 questions to smart minds

How companies with weak credit ratings can finance growth

For this 3 questions to Tobias M. Weitzel

CREDION AG in Hamburg
Photo: Tobias M. Weitzel
10. Novem­ber 2020

In the current situa­tion, many medium-sized compa­nies are in need of addi­tio­nal liqui­dity. Espe­ci­ally for compa­nies in crisis and special situa­tions, finan­cing via private debt funds can be an alter­na­tive or supple­ment to bank loans. But debt funds also offer addi­tio­nal oppor­tu­ni­ties for growth finan­cing. You score with flexi­bi­lity and willing­ness to take risks. This also posi­ti­ons them as an alter­na­tive to private equity. How entre­pre­neurs can gain room for maneu­ver without having to sell company shares or relin­quish control of the company, 3 ques­ti­ons to Tobias M. Weit­zel, one of the two board members of CREDION AG in Hamburg.

For this 3 ques­ti­ons to Tobias M. Weit­zel, Member of the Manage­ment Board at CREDION AG in Hamburg

1. What needs do you see among your target groups in terms of finan­cing? What added value can CREDION offer them?

Our offer is aimed at any entre­pre­neur who wants to finance a growth spurt — without giving up shares in his company. The demand is immense, whether in retail or produc­tion. Finan­cing is far too often a brake on growth. We want to change that. Entre­pre­neurs need flexi­bi­lity in loan volume, matu­rity, and a finan­cing struc­ture that precis­ely fits their value chain. We’re looking at that very closely. Addi­tio­nal added value is provi­ded by our risk analy­sis of the value chain and recom­men­da­ti­ons for effi­ci­ent risk manage­ment. In this respect, we have abso­lut­ely iden­ti­cal inte­rests with our credit custo­mer. Better risk manage­ment ensu­res that more custo­mers have access to finan­cing — from start­ups to estab­lished compa­nies looking to finance a large contract. With our finan­cing, the entre­pre­neur can take advan­tage of oppor­tu­ni­ties without having to give up shares to a co-inves­tor. Result: The full increase in value belongs to the entre­pre­neur. That is the guiding prin­ci­ple of our new trading fund.

2. How does your new fund diffe­ren­tiate itself from compe­ti­tors? On what scale do you finance?

We analyze the entire value crea­tion process in order to be able to provide the maxi­mum value contri­bu­tion with our finan­cing. We focus on the tran­sac­tion struc­ture, not on a customer’s credit­wort­hi­ness. The tran­sac­tion itself is our secu­rity. This makes it possi­ble to provide finan­cing to start-ups as well. And start­ups can use their inves­tors’ money for struc­tu­ral invest­ments instead of tying it up inef­fi­ci­ently in goods and receiv­a­bles. Our approach is the entre­pre­neu­rial perspec­tive: How do we manage to increase capi­tal produc­ti­vity toge­ther? Through intel­li­gent finan­cing, one of our retail custo­mers, for exam­ple, mana­ged to triple its sales and quadru­ple its earnings. For retail­ers, this is a fami­liar pheno­me­non: it works the same way as a three times faster inven­tory turno­ver speed. We can finance a line of up to EUR 5 million per company with our current fund, which we make available as flexi­bly as an over­draft faci­lity. Compa­nies then use this finan­cing as needed for a few days or seve­ral months — but in all cases to procure addi­tio­nal volu­mes and deli­ver them to their own custo­mers. We start as low as 100,000 euros when revol­ving finan­cing is required.

3. Who are your investors?

These are high-profile entre­pre­neurs, top mana­gers, inves­tors with distinc­tive finan­cing exper­tise and family offices of entre­pre­neu­rial fami­lies. Our inves­tors under­stand very well what the diffe­ren­tia­ting advan­tage of our finan­cing is and have studied our model inten­si­vely. We have been inspi­red by tradi­tio­nal, very clever finan­cing models from anci­ent Greece and Pales­tine, Genoa, Venice and Fland­ers. In short: We parti­ci­pate in the success — in case of fail­ure we also go empty-handed. We have ther­e­fore also made a very conscious decis­ion not to charge struc­tu­ring fees. We consider it central that the inte­rests of loan custo­mers and finan­cing part­ners are aligned. This also convin­ced our inves­tors. Toge­ther, we want to enable the success of a tran­sac­tion. A fair model with simple rules. Compa­nies only pay for what they actually get — a finan­cing frame­work and a loan actually drawn down to finance their growth.


CREDION AG (“Loans when it counts”) finan­ces entre­pre­neurs and their compa­nies in chal­len­ging growth phases, during take­overs, in succes­sion situa­tions or basi­cally in special situa­tions with credit and supports know-how. CREDION AG is backed by a large circle of high-profile entre­pre­neurs and wealthy indi­vi­du­als who think and act like entrepreneurs.

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