Innovation and Funding - an EBRD Perspective 5G Ecosystem Forum, - PowerPoint PPT Presentation

Innovation and Funding - an EBRD Perspective 5G Ecosystem Forum, Baltic Sea Region Riga, September 27, 2018 J ürgen Rigterink First Vice President, EBRD

About EBRD  Founded in 1991 69 shareholders from 5 continents   We invest in 38 economies  Capital base of € 30bn and a triple-A rating  Since 1991 invested > € 120 billion in >5,000 projects ( € 9.2 billion in Poland, € 2.1 billion in the Baltics)  2017: € 9.7 billion in 412 projects, € 1.1bn of mobilized investment

Our Mandate Mandat ate: e: furthering progress towards market-oriented  economies  Focus us on Privat vate e Sector: r: key conduit of delivery across the full capital structure  Po Polic icy Connect ectivit ivity: : engagement multiplier  Mobilis ilisat ation ion: financial multiplier Market et Pricing: ing: working with markets without market  distortion  Sector or Know owled ledge ge & Locally ally Embedded: dded: strong sector teams 56 offices in 35 countries of operations  Prefer erred red Credit itor or Status us: : privileges and immunities provide risk mitigation

EBRD - ICT Investments Total tal amou ount t invested vested ( € m) since 1991 91 by sub-sec ector tor 1,586 538 538 36% 36% 12% 12% Mobile 224 5% 5% Other Telecom Innovative Tech Other 2,028 47%  € 4.4 .4 billion lion inves ested ed in ICT  including luding € 3.6 .6 billion lion in telecom oms, , of which: h:  € 1,6 billion in mobile (36% of ICT investments)  € 864 million (20% of ICT investments) in the Baltics and Poland 4 4

EBRD - ICT Experience and Focus Knowled ledge e Econom onomy Initiati iative (2014) promotes:  infrastructure investment - e.g. 4G/5G, fibre  local R&D  investment and support for early stage technology companies  TC-funded support for national policy, legal & regulatory frameworks, capacity building Venture Capital ital Investm estmen ent Programm amme e (2012): ):  € 200m dedicated fund  for early stage high growth tech companies  makes investments and brings in-house and industry expertise  developing the local VC ecosystem 5 5

EBRD - Investment in Innovative Tech Invest stments s in Innovative Tech chnology se segment by pe peri riod ( € mn) alongsi side landmar arks s in the tech chnology re revolution 179 35 10 0 1991- 1997 1998-2004 2005-2011 2012-2018 1989: 1993: 1994: 1998: 2004: Public Emails Amazon Google Facebook Internet started Founded Founded Founded Started 6 6

EBRD - Recent ICT Experience Technolog New nology EBRD projec jects  87% ‘KEI’ € 700m broadband  Infras  € 200m innovative tech astruc  € volume → infrastructure debt tructure  number of projects → equity, VC ure VCIP (2012) 2)  € 53m invested to date in 14 companies Debt Debt Equ Equ quit quit ity ity y y Venture Venture ure Capital ure Capital 7 7

EBRD – ICT in the Baltic Region 8 8

EBRD – Challenges in the Baltic Region Why? EBRD RD Investm estment nt in ICT T (2014-2017): ):  Most advanced region (regulatory & market reforms and knowledge economy) Estoni Es onia - € 0  Sector is well-served by commercial Latvia via – € 0 banks, equity investors, DCM and ECM Lith thuan uania - € 5 million But Poland nd - € 456 million The VC ecosystem is nascent 9 9

The Nascent VC Ecosystem in the Baltic Region  The Baltic Region lags well behind global leaders such as Israel and the US.  Early stage companies look to Western Europe, or further afield, (e.g. US) for VC funding. Poland nd Latvia ia Eston onia ia 10 10

5G – Is it a Game Changer? Differ erin ing views, s, but: Large investment amounts and long tenors ( € 500bn for Europe?)   5G economics may drive infrastructure sharing  EU Gigabit Society 2025  Need to develop the local VC ecosystem to support local entrepreneurial talent, to create the applications that will run on 5G broadband EBRD:  Large ticket, long term financing for telecoms  Tower company financing  Debt and equity  Supporting VC ecosystem for early stage companies through finance and expertise. Support for other 5G ‘Use Cases’ such as Smart Cities  11 11

Final Remarks  Public sector support (incentives, subsidies) required to make 5G truly widely accessible.  The EBRD will play a multi-faceted role: financing 5G, supporting early stage tech companies, supporting the VC ecosystem, development of smart cities.  The EBRD is ready to play its part in the creation of a truly connected world throughout its mandate countries. We are confident that we will play a key role in the Baltic Region too! 12 12

Contacts EBRD, One Exchange Square London, EC2A 2JN United Kingdom www.ebrd.com Find us on social media