This week, Berthold Baurek-Karlic, Alexander Rapatz and our Junior Analyst Lukas Arzberger attended the European Forum Alpach and took part in the Economic Symposium. One of this year’s hottest topics was the digital revolution.
The topics of merging industries, creating new business models and promoting a closer collaboration between startups and big corporates were intensively discussed at a side event with Wolfgang Anzengruber (CEO, Verbund AG), State Secretary Harald Mahrer and Richard Grasl (ORF Commercial Director). With the ever growing speed of innovation cycles, even the biggest corporations are facing competition from young companies that traditionally would never have been in the position to compete. One strategy for corporates is to work closer with startups and therefore enable access to innovation. This approach has already been proven to work across many industries, as Mr. Mahrer pointed out.
Venture Capital in Austria
Afterwards, with an insipring backdrop of picturesque mountain scenery, Wilhelm Molterer (Vice President and member of the Management Committee of the European Investment Bank), Christoph Leitl (Chairman of the Austrian Chamber of Commerce) and our CEO Berthold Baurek-Karlic discussed the current market environment for establishing venture capital funds in Austria. One big step forward would be, if trusts were given the necessary permission to invest in venture capital. Another one, if banks would be capable to offset their venture capital investments from the Austrian Bank Levy (“Bankenabgabe”), which would effectively compensate them for the burdening capital adequacy obligations for such investments.
The last one is critical for Europes’s economy, as Basel III and Solvency II have already raised barriers for banks and insurance companies to invest within this asset class. This caused an unintended side effect. In fact, both regulatory frameworks intended to stabilize the economy after the latest crisis. However, as a result early stage financing was also strongly challenged through these regulatory frameworks. Venture Capital is urgently needed in Europe as it drives growth, builds jobs and secures the competitiveness of local markets.
We hope the current attention for this topic, discussed by Top Level Executives and Politicians from all over Europe, will boost positive developments to ease this challenging market environment.