20 June, 2019

How do you finance your start-up company?

Small and medium-sized enterprises (SMEs) represent the backbone of the European economy, employing two-thirds of all workers and generating almost 60% of all added value. In addition, start-up SMEs play a decisive role in economic growth. For this reason, the European Union has been working hard for improving the business environment in which SMEs operate – from the 2008 Small Business Act – for a long time.

An important aspect of the functioning of SMEs is their access to funding sources, both equity and debt. While large companies often have access to diversified sources, SMEs – especially start-up SMEs – are often neglected. Therefore, the latest legislative proposal of the European Commission focuses specifically on this aspect of their business, by facilitating their access to the so-called multilateral trading facility (MTF).

MTFs are platforms that are similar to traditionally regulated markets (stock exchanges) as they provide certain standards regarding transparency of operations and enable quick execution of transactions – thereby attracting investors. At the same time, MFTs, with financial instruments traded on them, impose less administrative obligations.

The European Commission seeks to facilitate the access of start-up SMEs to MTFs focusing on SMEs (eg. by simplifying the obligation to publish a prospectus) and, in general, to reduce their administrative burden (eg regarding mandatory disclosures under the Market Abuse Regulation).

In this way, transparent multilateral markets – attracting investors and traditionally reserved for large companies – are becoming easier to access (startup) SMEs. While the only Slovenian MTF (SI ENTER, managed by the Ljubljana Stock Exchange) is not yet specialized for start-up companies, some foreign MTFs are – the closest is the MTF Zagreb Stock Exchange.

Have you considered setting up an MTF as a way of financing your business?

RELATED POSTS
New wave of the epidemic, new restrictions on the work of the courts

New wave of the epidemic, new restrictions on the work of the courts

On 19 October 2020 the president of the Supreme Court issued an Order on special measures from Article 83.a of…

Read more
Revolut moves its customers to Lithuania – have you notified the change to the Financial Administration?

Revolut moves its customers to Lithuania – have you notified the change to the Financial Administration?

Revolut Ltd, a British fin-tech company that offers banking services, has started shifting its customers to its Lithuanian entity Revolut…

Read more
We are ranked in the IFLR 1000

We are ranked in the IFLR 1000

We are proud to announce that our law firm has been ranked #Tier 3 for Corporate and Financial law in…

Read more

Address:

Dalmatinova ulica 2
SI-1000 Ljubljana, Slovenia

Phone:

+386 59 097 400
+386 59 097 410

Email:

info@s-k.law

Social: