A fund of 19 funds
The Belgium Growth Fund is what we call, in financial jargon, a “fund of funds”. This means that BGF does not invest directly in companies, but through specialist venture capital and growth funds. Depending on opportunities and following rigorous selection of files, these funds invest in scale-ups and growth companies.
With Sofindev, the new “Belgian Growth Fund” has already made its third investment
BGF I closed its investment phase last June. Between 2019 and mid-2024, he invested in 19 Belgian and cross-border funds. “In total, BGF I is expected to provide more than 300 million euros in risk capital to around sixty Belgian scale-ups and growth companies.indicates, to The FreePierre Demaerel, president of Belgium Growth Fund. Of the 130 companies invested to date by the 19 funds, there are already 40 Belgian companies.
The objective of the BGF is to support the growth and internationalization of promising Belgian scale-ups and companies by giving them access to risk capital, thanks to the funds in which BGF invests, while ensuring their Belgian anchoring. Belgium remains behind, compared to its neighbors, in terms of financing scale-ups and growth companies. When they have to raise 20 or 30 million euros, they are often forced to turn to foreign funds or be absorbed by companies not established in Belgium. The risk is then great of losing the benefits, in terms of value creation and jobs, of these emerging gems.
A respected roadmap
By relying on specialized funds (such as Smartfin, Fortino, Sofindev, Andera, Kurma, M80, Forbion, Apheon, etc.), BGF I has built up a solid portfolio of active Belgian scale-ups and growth companies in different sectors. This is the case for companies such as Theo Technologies (a Leuven-based company which develops video technologies), Ampacimon (a Liège-based company providing surveillance software and sensors for electrical networks) and Acumen (a Brussels-based lobbying company). Of the 40 companies invested to date, it must be admitted that there are few Walloon companies (Hex-Rays, Sigma Conso, Haulogy, Ampacimon, etc.). “This is a reflection of the economic reality of Belgium (in terms of growth companies and venture capital funds, Editor’s note)”, Pierre Demaerel simply notes.
gull“With 576 million euros invested in 40 Belgian scale-ups by the funds in which we have invested, we have already reached 3.7 times the amount that Belgian Growth Fund has released from these funds.”
The financial performance of BGF I is, in any case, up to the objectives stated when the fund was launched in 2019. “With 576 million euros invested in 40 Belgian scale-ups by the funds in which we have invested, we have already reached 3.7 times the amount that BGF has released from these funds. welcome Wouter Winnen (Head of Fund Investments at PMV) and Koen Broothaers (Investment Director of BNP Paribas Fortis).
BGF I shareholders have already started to receive the first fruits of their investments thanks to the payment, by some of the 19 invested funds, of capital gains realized during the sale of shares. “At the end of the 3rd quarter, 16 million euros had been returned to BGF I shareholders, continue the representatives of PMV and BNP Paribas Fortis. This represents 9% of the resources that we have currently released for the various funds in which we are involved.. The financial return, measured by the net IRR (i.e. after deduction of management fees due to the various funds), already reaches 8.04%. “This is a great performance, for a fund of funds, at this stage of the investment and while we are not yet a third of its lifespan (18 years). So far, we have delivered what we promised to the fund’s investors. Based on our projections, we estimate that the net IRR should be between 10 and 15%.”underlines Pierre Demaerel.
BGF II, copy-paste of I
The second BGF fund is a copy and paste of the first. The only real novelty concerns the portion dedicated to ESG funds (75% of resources invested in Article 8 and 9 funds).
PMV and BNP Paribas Fortis were once again chosen by the SFPI to manage the fund. They are also among the first investors: while SFPI plans to invest up to 150 million euros in BGF II, PMV will inject a total of between 25 and 40 million and BNP Paribas Fortis 25 million. AG Insurance and Ethias have also already decided to come back. And given the good performance of BGF I, we expect most others to follow. New potential investors, for their part, should come forward during a second closing planned for sometime in 2025.
gull“We would like to attract Belgian family offices. From now on, thanks to BGF I, we can demonstrate financial performance and a very solid portfolio. We have respected our roadmap.”
The BGF II has set itself the final objective of raising 350 million euros (with a ceiling of 400 million). “We would like to attract Belgian family officesexplains Pierre Demaerel. It is a very diversified product in terms of risk. Now, thanks to BGF I, we can also highlight financial performance and a very solid portfolio. We have respected our roadmap, which gives confidence to existing investors, but also to future investors.”
Otherwise, the strategy remains unchanged: the objective of BGF II is to invest in 10 to 15 specialized investment funds.
