While we are hearing more and more about the ICO, this way of raising money in cryptocurrencies can still seem nebulous and uncertain. This is because anything remotely linked to virtual currencies is subject to rather polarising debate. Will the ICO become a real way for companies to raise funds ?

Raising equity in the digital era

The Initial Coin Offering (ICO) is an alternative financing method which involves raising funds in digital currency in the startup phase of a company. Specifically, the company issues chips (i.e. digital assets known as tokens) on a dedicated platform and, in exchange, receives an amount in a cryptocurrency, whether this be Bitcoins, Ethereum or any other altcoin (the name given to the hundreds of cryptocurrencies in existence). The whole transaction is therefore based on blockchain technology.

Similar to crowdfunding

Comparable to an IPO (Initial Public Offering) - the operation which allows a company to list its shares on a stock exchange - the ICO is more similar to fundraising via a crowdfunding platform. In effect, it can be accessed by anyone who holds virtual currency and requires neither shares to be issued nor a stake to be acquired. This means that the investor is not subject to any potential dilution of the capital. The crypto investor therefore bets on a specific project and, in exchange, receives digital assets, access and use of the service being offered, plus part of the profits generated by the company.

Is it reserved for blockchain companies?

The phenomenon of raising funds via an ICO is taking on considerable proportions (in 2017, more than 4 billion dollars are believed to have been raised via ICO worldwide), but it is still primarily reserved for companies which have built a link to a blockchain technology into their project. This is because the operation tends to be quick, flexible and simple, requires no intermediary and, above all, is unregulated. This type of financing therefore primarily attracts blockchain startups looking for significant funds... From the crypto investor side, while some cryptocurrency billionaires say that they want to support blockchain projects, there is no doubt that their interest is based partly on the significant liquidity of the ICO, as well as on the quick returns on their investment, which are the result of the considerable price volatility.

Communicate well for a successful consultation

In most cases, this starts with the drafting of a white paper (equivalent to the prospectus for an IPO) in which the framework of the project, especially the underlying technology, is laid out in order to arouse market interest. Generally, the company puts forward its own cryptocurrency, then sets the terms of the ICO (duration etc.) and the value of its tokens - which will be purchased, for example, with Bitcoins or Ethereum - according to the amount required to complete its project. What follows is often a huge surge...within only a few minutes!

Growing appetite

12.5 million dollars in 15 minutes (for the decentralised predictive markets platform Gnosis in the Netherlands), 36 million dollars in 1 minute (for the startup Brave which is developing a new generation of web browser), 250 million dollars for Filecoin (the American company which offers a data storage solution based on blockchain)... There are tons of crazy fundraising examples. At the start of 2018, the encrypted messaging service Telegram reported that it wanted to create its own blockchain technology to house decentralised services, via the most significant ICO to date: over one billion dollars. "Old hands" are also embarking on the adventure: Kodak, for example, who announced a project to develop a blockchain specially dedicated to managing copyright.

What does the future hold for the ICO?

Clearly, the world of cryptocurrency must often navigate greed, excess and speculation. In this sense, both for companies and for crypto investors, the ICO does not just present advantages. Potential hazards include the lack of guarantees of the relevance, seriousness and quality of a project, and also the huge volatility of virtual currency prices. Many experts are also predicting that it will create a bubble which will indeed burst one day. But when ? It's too early to say! As with the dot-com bubble at the start of the century, this might give us a clearer picture and allow us to clean up the world of digital currencies. In any case, there is no doubt that the question of regulation and the framing of this kind of financing will also be one of the main challenges facing the ICO in future...

Factoring is playing an increasingly important role in promoting the growth of Belgian and international companies. BNP Paribas Fortis Factor provides the oxygen to their growth story.

You want your business to grow and thrive, and so all the help and guidance you can get are more than welcome. The reason is clear: support brings extra energy to your entrepreneurial spirit and essential resources to fuel your innovative growth plans.

BNP Paribas Fortis Factor, a subsidiary of BNP Paribas Fortis, offers a service designed precisely for that: to relieve stress and motivate, to promote and nurture your growth. In this interview, Jef Ramaekers, Head Factoring Benelux at BNP Paribas Fortis Factor, and Audrey Bourguet, Working Capital Advisor at BNP Paribas Fortis Corporate Banking, come together to discuss one key topic: Factoring and the positive role it can play for Belgian businesses and their international branches.

Explaining factoring succinctly, however, is a challenge. Jef Ramaekers, Head Factoring Benelux at BNP Paribas Fortis Factor, clarifies: “To start with, factoring is a means, not an end. It’s a tool for business owners or CFOs to optimise working capital. Every financial manager, in any company, will at some point ask the same question: ‘Who do I need to pay, when, and how can I pay them with the resources I have?’ Simply put, factoring enables businesses to pay suppliers without waiting for customer payments to come in. We finance invoices by converting them into directly available cash for the business.”

This process actively alleviates concerns and reduces stress factors, allowing entrepreneurs to focus on what they do best – running their business. Ramaekers adds, “We like to say ‘giving oxygen to growth stories.’ But I certainly see the value in the term ‘relieving stress’ here. By giving an entrepreneur or CFO the freedom to focus on core activities and by taking on a key part of the financial management, we create extra time and opportunities. And they also have less to worry about."

Positive shift

According to Ramaekers, the traditionally negative perception of factoring is a thing of the past: “Factoring was once seen by many business leaders as a ‘lender of last-resort’ – a way to borrow money from the bank by using assets, receivables, or customer invoices. In other words, a company’s last resort. Fortunately, those days are long behind us. We’ve evolved towards a very open attitude to factoring, allowing our division to grow into a true service provider. Our clients’ primary need remains short-term financing. Today, one in five invoices in our country is paid through factoring. Factoring is now a substantial market, representing more than one hundred billion euros per year. BNP Paribas Fortis Factor manages 41 per cent of this market, accounting for EUR 55 billion at the end of 2023.

Growth

From the bank’s perspective, factoring also represents a significant growth story. Audrey Bourguet, Working Capital Advisor at Transaction Banking for BNP Paribas Fortis, explains: “Today, factoring is the financial product that nicely aligns with the rising turnover of our companies. It provides a practical solution for working capital and is part of a suite of Transaction Banking services. In addition to Factor, this also includes Global Trade Solutions, Cash Management, Fixed Income, and Working Capital Advisory. All these services share a common goal: provide the best possible solution for our clients’ financial needs and be there for them in all situations where they can benefit from our support.”

Factoring, from the bank’s standpoint, represents an increasingly strong and positive story, unlinked from its past connotations. Bourguet adds, “You can see this in how we truly integrate factoring within our bank and the group, and in how we offer this service to businesses across all sectors and sizes. We work with a wide range of companies in the Belgian economy. As a result, we have seen that it is precisely those companies that succeed in optimising the funding of their working capital by making use of our factoring services, among other things. This reinforces our belief that it is a very positive story: we’re talking about a form of financing that seamlessly adapts to the growth of any business, large or small.”

Natural evolution

Factoring is available to small, medium-sized, and large companies alike. Ramaekers says, “We aim to provide a solution that supports businesses throughout their entire lifecycle – we’re genuinely unique in the market in this regard. This means that we are there for start-ups, SMEs, multinationals, and every type of business in between. We are the only bank on the market to have a digital solution for small businesses in the form of Easy2Cash. This digitalisation makes it a very cost-effective option with highly competitive margins, but also a reliable, particularly fast and up-to-date link with our customers and their accounting, using a digital yet personal approach. Although Easy2Cash is digital, it includes a dedicated contact person, making the solution both personal and accessible. For start-ups, for example, it’s often challenging to secure credit. For these modest, short-term credit needs, we provide a solution in consultation with the BNP Paribas Fortis banker, enabling them to keep growing without being hindered by their expanding requirements for financing, automation, accounting, etc. Factoring gives them additional resources to meet these needs.”

Ramaekers notes that the steady growth of young companies also demands an adaptation of financial services: “It’s a natural evolution that benefits both partners. If your business grows, we grow with you – it’s that simple. During all those specific growth moments – when entrepreneurs start considering additional staff or potential exports – factoring grows with them. And we do this together with the bank; the group behind this story plays as a team. And let’s not forget, we’re here even if more challenging times come. We’re well aware that a company’s journey is not always easy. It’s at those moments that the value of our expertise and the support we provide really stands out.”

When a company grows into a large enterprise with the profile of a multinational, the importance of factoring further increases. Ramaekers says, "More than 65% of the really large companies in Belgium, with a turnover of more than EUR 1 billion, use factoring services. And half of them are our customers. Factoring often provides additional economies of scale for large enterprises. For example, we can finance receivables that have no impact on a company’s debt ratio. By combining invoice pre-financing with credit insurance, companies can avoid having debt on their balance sheet, with the approval of the company auditor. It’s a technical matter, but it is this combination of various financial elements that makes factoring efficient, high-performing and valuable for many companies.”

Economic fabric

The two agree on the value of factoring in supporting the economic fabric. Bourguet explains, “Part of this supportive role is due to the fact that factoring is a completely transparent financial service – you can only finance what is effectively there.” Ramaekers adds, “Absolutely. Plus, factoring sits right in the middle of the value chain, embedded in the economic fabric. We work alongside our clients, their customers (debtors), the bank, and so on. This makes us a key figure in this chain. We coordinate and facilitate. And for this we need to have our feet firmly planted on economic ground, often for the benefit of all our customers. When we succeed in, for example, reducing the payment terms of invoices for a business, it has a positive ripple effect not only for that company but for the economic process as a whole. This is why I am convinced that we play a broad role in the economic ecosystem – often broader than is generally perceived.”

Opportunities and fair guidance are also crucial in this financial field. Ramaekers says, “At Factor, we engage in transparent discussions with the bank and our clients to find the best solution for their needs. This means we identify opportunities and often suggest them, but also act as an honest, proactive sounding board. It’s about dialogue, analysis, and constructive critique.” Bourguet concurs: “I completely agree. With a service like factoring, we are deeply involved in our clients’ economic activity – the entrepreneurs who rely on us. So, we take a broad view of every case, looking beyond just a banking product or a single solution. This is what makes BNP Paribas Fortis’s approach so strong: we operate as a team, consisting of specialists from both Factor and the bank. This group of experts from different, well-coordinated entities provides entrepreneurs and companies with a comprehensive approach, even for complex cases. These are the moments when we truly rely on our internal expertise: years of experience; colleagues with solid knowledge; reliable economic data applicable to numerous scenarios. This combination enables us not only to guide companies in the right direction but also to provide financial support that is fair, safe, and sound.”

Future

Just like the bank itself, BNP Paribas Fortis Factor frequently considers its strategic direction for the future. As a provider of forward-thinking services, it’s essential to adopt a future-oriented approach to financial services. Ramaekers notes, “Earlier, I mentioned our digital solution, Easy2Cash. I think we can be quite proud of this because it is a glimpse into the future – today. Beyond that, our services are evolving very organically towards the future: we’re constantly striving to make them accessible to an ever-wider group of clients across the economic landscape. Additionally, we’re very focused on sustainability.”

Bourguet adds, “This last aspect is a natural extension of what we do at the bank every day. Our commitment to sustainability extends seamlessly to factoring: we encourage and motivate our clients to join us on this sustainable path.”

The two teams also collaborate closely in developing new services. Ramaekers explains, “We see a significant evolution in the commercial sector, with many online stores offering deferred payment options, such as a 30-day extension. This practice is also increasingly common in the B2B market. Factoring can innovate in this area, so we see it as part of the future we’re actively developing. From a European perspective, there are other innovations too: e-invoicing, for example, is soon to become the standard for all businesses. This presents both a challenge and an opportunity in terms of services and advisory, which we’re shaping together with the bank.”

The two partners have also developed new services. Ramaekers: "We have observed a remarkable evolution in the commercial sector, where many online stores offer payment delays of 30 days, for example. This practice is also increasingly common in the B2B market. Factoring can offer an innovative solution, so this is part of the future that we are currently developing. On the European level, there are also new features: e-invoicing will soon become the norm for all companies. This presents both a challenge and an opportunity in terms of services and advice, which we are developing together with the bank."

Bourguet concludes, “It’s clear that this is a story of synergy, one where we work together seamlessly. This isn’t just rewarding for us but also for our clients. We’re rooted in the heart of the economic marketplace, yet we’re also focused on creating platforms and products that will lead the way and shape the future of this market.”

More information: https://factor.bnpparibasfortis.be/

Can a fashion company be successful even if it forgoes the excesses of fast fashion? Definitely, as Jean Chabert proves with Stanley/Stella, which produces custom-made clothes from organic cotton.

The Brussels-based scale-up Optimy brings together corporate volunteering, donations, patronage and sponsorship activities all on one platform. On it, their impact on society is concretely measurable.

"Originally, I didn't think of myself as a social entrepreneur, even though I was involved in sponsorship. At the request of our customers, my partners and I have developed an entire provision of services that has become the most comprehensive platform on the market," says Kenneth Bérard, CEO of Optimy.

One of these customers was the BNP Paribas Fortis Foundation, which wanted to make a greater social difference and also give these actions more visibility. "It's a must for companies to contribute to society. This generates added value for the company and fuels a positive spiral. But that social impact has to be measurable. How many children have been helped? How many trees have been planted? What effect does this have on employee satisfaction, image and turnover? Our model offers all of this. This means that companies don't have to purchase new modules every time they want to add additional activities. I think that’s our great success factor. We are the market leader in Europe in our sector and the only company operating in both Europe and North America."

Personal support

"Many companies are full of good intentions. They want to have a positive impact on society, but they often lack a good method to do this efficiently," the entrepreneur notes. "They tend to see all their efforts in isolation. The Optimy platform offers a solution for this. It's easy to put together and it's service-oriented. We adapt to the processes of each business unit and company. It doesn't work the other way around," assures Bérard. "Our customers are not looking for technology; they're looking for guidance. We invest in personalisation, and it's paying off, as a customer satisfaction survey shows."

Structuring actions

The first piece of advice that Optimy always gives companies is: don't shred your efforts, they should form a whole. "We recommend that companies structure their actions using our tool. The corporate social responsibility policy must be in line with the company’s values, DNA and broader strategy. And of course, the actions must be transparent and well executed."

The right partner

From the beginning, the connection Optimy had with BNP Paribas Fortis was decisive for the company’s growth. "The fact that the bank follows us has increased our credibility with our partners, investors, customers and also internally. Now it's setting up a factoring service for us to further support our growth."

Optimy's growth was initially supported by cash flow, which is unusual for a technology company. Financing came into play beginning in 2019. That's when a Canadian fund specialising in software as a service (SaaS) companies and affiliated with the prestigious Massachusetts Institute of Technology (MIT) became a shareholder.

Multicultural enrichment

As with increasingly more companies, one of Optimy’s biggest challenges is recruiting new talent. “We've been able to convert that challenge into an asset,” concludes Bérard. "We attract talent from abroad. Sixty people from twenty nationalities work in our Brussels branch. This multiculturalism is a huge enrichment and has helped us break through internationally."

“The corporate social responsibility policy must be in line with your company’s values, DNA and broader strategy”.

BNP Paribas Fortis is ready for the mobility of tomorrow. And Laurent Loncke, General Manager Retail Banking and member of the bank’s management committee confirms this when he says “We do much more than lease electric vehicles”.

How can companies leverage mobility as part of their transition?

"If we look at vehicle usage alone, switching from fossil fuels to electric energy can reduce CO₂ emissions by a factor of four. This transition is being encouraged in our country more than ever by tax incentives and tax breaks. From 2035, the European Union will also ban the sale of cars with combustion engines. Whether it’s for the company fleet or company cars for employees, electric driving is the way forward, alongside other forms of mobility."

Are all businesses aware of this?

"These days, two out of every three new vehicles are company cars. And 80% of those orders are electric vehicles, a trend that is also apparent at our partner Arval."

So companies are playing a pioneering role in this transition?

"Certainly. First and foremost because former company cars find their way to the second-hand market at some point, making electric driving more accessible for everyone. Secondly, by choosing an electric car, you can encourage your friends and family to follow your example. Our recent Profacts survey (only in Dutch and French) showed that 85% of electric vehicle owners are satisfied to very satisfied that they switched to an electric vehicle. However, 42% of Belgians are still reluctant. Half of them are worried their battery will run out before they can get to a charging point."

Is their fear justified?

"Not really. Most drivers only feel comfortable with a range of 500 kilometres, even if they only drive a few dozen kilometres a day. It’s true the charging network does need to be developed further. Many people, especially those living in cities, cannot install a charging point at home. BNP Paribas Fortis is contributing to the expansion of the charging network through its participation in Optimile. This Ghent scale-up offers software solutions for charging electric cars and is developing strategic partnerships for the installation and maintenance of charging points."

Can an electric car be part of each employee’s remuneration package?

"Today, there are already less expensive vehicles on the market, making electric driving an option for middle and lower-management. The Total Cost of Ownership of an electric car is the most important factor, however. And this is still much lower than that of a vehicle with a combustion engine. Leasing is often the best solution. We have a comprehensive, tailor-made offering for all companies, regardless of their size and needs."

What exactly do you mean by a 'comprehensive offering'?

“In addition to leasing, we are able to offer charging solutions at home or at work, a charging card for public networks, the automatic reimbursement of electricity consumption at home, an app to find charging stations, and electric driving training through our many partners.”

So a complete ecosystem?

"We want to contribute to the mobility of tomorrow. By financing it, through credits or leasing, and with insurance, but also by working with partners outside our traditional activities. Like Optimile, and Touring, an organisation that is synonymous with reliability."

But mobility isn't just about cars, is it?

"We believe we need to rethink our relationship with the car. Given the climate targets and the increasing scarcity of resources, it is simply not possible to replace every internal combustion engine with an electric car at the moment. Arval offers its extensive expertise to companies considering a different approach to mobility. We help them analyse their needs, propose alternatives to the car, establish a mobility budget or draw up a mobility policy. We offer bicycle leasing, sometimes in combination with car leasing. We strongly believe in multimodality and mobility-as-a-service solutions: the option to combine different transport modes and pay for them without too much hassle. This is also one of the specialities of our partner Optimile."

Are companies and their employees open to this idea?

"The idea of employees no longer saying 'I have this amount for my car in my salary package', but rather 'I have this amount for my mobility'  is gaining traction. People are already paying for use rather than ownership in gyms or for streaming services. Mobility is going down the same route, with car-sharing and flat-rate subscriptions, making costs more predictable for businesses and private individuals. But the pace of change will also depend on the success of the federal mobility budget. For now, uptake is slow."

BNP Paribas Fortis SA/NV – Montagne du Parc/Warandeberg 3 – 1000 Brussels – VAT BE 0403.199.702 – RPM/RPR Brussels

Optimile SA/NV – Sassevaartstraat 46 bus 204, 9000 Ghent – RPM/RPR Ghent – VAT BE 0648.837.849 – www.optimile.eu – BNP Paribas Fortis SA/NV holds a greater than 10% stake in Optimile SA/NV.

Arval Belgium NV, Ikaroslaan 99, 1930 Zaventem – Brussels Register of Companies – VAT BE 0436.781.102.

Touring SA/NV, Koning Albert II-laan/Avenue Roi Albert II 4 B12, 1000 Brussels – Brussels Register of Companies – VAT BE 0403.471.401, is registered under this number with the FSMA, Rue du Congrès/Congresstraat 12-14, B-1000 Brussels, and acts as an associated agent on commission for AG Insurance SA/NV. AG Insurance SA/NV owns a greater than 10% stake in Touring SA/NV.