SESSION 1From Start-Up to Scale-Up

Early Stage Investing

APEC Accelerator Network Forum IAtlanta, Georgia, USA

MSME’s Access to Finance:Key Areas in ABAC’s Work

Lending Infrastructure• Credit information systems

• Secured transactions and movables financing

Trade and Supply Chain Finance• Legal/regulatory issues (Basel III, KYC/AML/CDD)

• Facilitators (trade settlement tools, e-platforms)

Alternative Financing MechanismsEnhancing Resilience

Overview of MSME Financing EcosystemPrerevenue

StageEarly Revenue Stage/

Early Commercialization StageEstablished/

Profitable Stage

Personal, Family and Friends Supply Chain Financing Bank Debt

Start-up Labs and Accelerators Internet Trade/Value Chain Finance Trade Financing – Letters of Credit

Convertible Debt Bank Line of Credit Junior Stock/Venture Exchange

Seed/Angel Funding Subordinated Debt Public Market IPO

Venture Capital Venture Debt Bond/Capital Markets

Crowdfunding Equipment Leasing Private Equity

Microfinance Venture Capital

Financial Capital Crowdfunding

Islamic Financing

Areas of Innovative Growth

Seed/Angel Funding Internet Trade/Value Chain Finance Junior Stock/Venture Exchange

Microfinance Venture Capital

Venture Capital Equity Crowdfunding

Crowdfunding

Source: APEC Business Advisory Council and SME Finance Forum, APEC Framework for Innovative SMME Financing Mechanisms

Regulations and Financial Services

• New financing mechanisms typically flourish under lightly regulated or unregulated environments.

Regulations and Financial Services

• New financing mechanisms typically flourish under lightly regulated or unregulated environments.

• Regulators step in as financing mechanisms’ economic, social and political impact or intersection with regulatory objectives become significant.

Importance of Legal, Policy and Regulatory Environment

Enabling?or

Disabling?

APEC: Creating an Enabling Environment for MSME Finance

Bringing public and private sector together

Better understanding of market evolution and

development

Better laws, policies, regulations

Especially important for new and rapidly evolving market for financing innovative enterprises!