Welcome to Poetzsch Consulting

Financing high-tech businesses is not something you can buy off

the shelf, like a mortgage for your home. Each project has its own

strength and weaknesses, scientific background, opportunities and

risks, and of course - people. It needs specialized investors who

not only work and think differently compared to banks, but who

also will take a much greater risk in providing you with the funds

you need to convert your science into business. *********, there

are several Thousand of these Venture Capitalists. And maybe a

handfull of them would be interested in just your project.
Of course, there are online directories of them, and business plan

templates you can fill in. But there is one thing you cannot

download: Experience from working with many investors and

companies over many years. Of course, you can insist on making

your own mistakes, and learning from them. But isn't the price for

it too high?
And because each project is special and needs a tailor-made

solution, it will take some time to get it "in dry sheets". So,

start early and consider: The best time for raising money is, when

you do not need it (immediately, I should add, to avoid any

misinterpretation).

Enjoy this site and let me know if there is something I can do for

you.

Yours
Joerg Poetzsch




Conflicting Political Signals for the German Biotech Industry



German politicians do not get tired to run expensive campaigns for

innvoations, including the biotech and pharmaceutical industries.

We hear, Germany should - again - become the "Drug store of the

World", after "some territory has been lost" (which is a mild

description for scaring away pharmaceutical research during the

past decades). Will now everything change? Hard to believe. And

right: While at the one hand, the Research Ministry puts hundreds

of Million Euros into research grants, it stops German scientists

from keeping up with modern stem cell research. And more: A new

law should make capital investments in innovative companies more

attractive. At the same time, a tax "reform" (the term "reform"

generally means, to make things better, and not worse), excludes

companies from these benefits that are less than 10 years old and

have more than 20 Mio EUR equity. In other words: Most promising

biotech companies. My best guess would be, it is still not fully

understood how the biotech industry works, and even more

"territory will be lost".



Venture Capital for German Biotechs declined in 2006



Ernst & Young reports a sharp decline of Venture Capital invested

in German Biotech companies in 2006 by almost 35% from 326 to 213

Mio €. The amount invested fell below the investments made in

2003. Compared to other European countries, Germany losts its 2005

top position, and now ranks on position three. Only Finland (-59%)

and Sweden (-39%) experienced a sharper decline in Venture Capital

Financing. France experienced a sharp raise (+60%) with a total of

€ 242 Mio invested, followed by the British Biotech industry (€

238 Mio). The average amount invested in Germany declined to € 5,5

Mio.The reason for the decline is related to the decline of "late

stage financing" rounds - due to the lack of a sufficient number

of such companies. Obviously, the short-sighted investment

strategy "late stage only" of the past years now starts paying its

tribute. Even the sharp raise of seed- and early stage financings

in 2006 will not be able to change the situation fast: The

comanies will need years to grow up.



Key Parameters of the German Biotech

* 480 "dedicated biotech companies"
* 13,000 employees
* 88% of these companies have between 10 and 50 employees
* only 4.5% have more than 100 employees
* the average age of the companies is 6.9 years
* 44% of the companies received venture capital in 2005
* 83% of the companies is active in the medicine/healthcare

sector



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Poetzsch Consulting
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