(Firstly published on 23.07.22 in Delfi Ärileht in Estonian, by Kaspar Allik)
A Belgian computer scientist Hugues Flament has always been interested in how the technology can improve the world. He’s been in financing for 25 years and the past 6 has been investing into startups as an angel investor.
Although Hugues lives in Belgium, joining EstBAN seemed to be a logical step. “Since a part of my portfolio is dedicated to finding unicorns, I was looking at the European map and tried to figure out which country has the most unicorns per capita. Naturally I found Estonia and wanted to start investing here”, said Flament.
As a member of Belgian angel investors network, joining EstBAN made sense. “Without EstBAN it would have been very tricky. Starting with how to reach the local startups as a foreigner, which conferences to go to, how to access the network – it was very reasonable, no regrets there whatsoever.”
“I mainly wanted to get access to the deal flow, hence got in contact with EstBAN’s president and the experience has been very-very positive.” Flament had only praise for Lev Dolgatsjov, who was a great help introducing Estonian business angels ecosystem.
“Monthly pitch events are very well organised and accessible online. All the pitches are in English and there is such a strong sense of community. Every time I’ve had a question for the EstBAN angels, I’ve received help and feedback”, said Flament.
Goal to create jobs
What drew Flament to angel investing, is the wish to create sustainable jobs, which has also impacted his investing strategy.
“The past 20 years has shown that the middle class is decreasing in Europe, due to the people getting richer and on the other side of the scale – poorer. This is why I was led to angel investing, so I could contribute to creating jobs in Europe, he said, which is why he has two portfolios – one to find unicorns and the other for creating job opportunities, the first creating capital for the latter. To enable creating jobs he has invested mainly into companies in education and entrepreneurship. Flament says that he’s not focused on specific sectors but has excluded companies in tobacco, weapons etc.
Estonia stands out with the strong community
In Flament’s opinion, he biggest difference between Belgium and Estonia is that you can see more deeptech companies. In addition, the local entrepreneurs understand that you have to aim international, from day 1. “Both countries are similar with the entrepreneurs’ desire to change the world. The difference is that Estonia has achieved grand success stories and those who have been among the first (unicorns) have reinvested the profits. And since the country is small, this has created the effect where almost everyone in Estonia wishes to be a founder. ”
He emphasized the local community feeling. “I know that there’s a slack channel where startup founders are searching answers to their problems, and since it’s a small country, there’s more support between the managers”.
During the past 18 months Flament has invested into 7 startups which are mainly in the sustainable energy sector. “In addition I have invested into digital signature solution and to an edtech company”.
Syndicated investments add trust
Flament has participated in 3 syndicated investments within EstBAN, in which he sees many advantages. First of all – deal flow. “Good deals in Estonia are competetive for the investors, and syndicates help to get access to deals which would be difficult to reach, since the individual invested amount should be a lot bigger.”
Secondly why should anyone invest within a syndicate, is the due diligence. “As a business angel you have to do research – find out whether the company that is raising funding, has a good product, customers, whether all is well in their financials etc. When investing alone, that research falls onto you, but in a syndicate there are other participants, which ease the load,” adds Flament.
Thirdly, the extra layer of security is added by EstBAN and the lead investor who are driving the syndicates.
Although most of the time Hugues participates in EstBAN events virtually, he really took interest in Estonia and last year brought his family here for a summer vacation. “This year I came to Latitude59, which was really amazing and well organised. I truly saw the dynamics of the local startup ecosystem, ” he added. “Most of the time I’ve participated in the events online but I’m really considering to come to Estonia more often to build a personal network and connections, ” said Flament.