Our portfolio companies have all been carefully selected. We only invest in dynamic teams with global mindsets who can take their company all the way to the top.
Our investment model
Borean is able to co-finance promising business ideas with up to 6,7 million DKK. The investment is a combination of capital infusion and risk-bearing subordinate loan capital. Depending on the size of the capital infusion, we will own a part of the new company for between 4 and 7 seven years – and then exit. We are happy to syndicate with other investors in the first round of investments.
We take risks with our investments, and as an innovation incubator we are more risk-minded than most conventional investors on the capital market.
Run-down of a typical investment
When our board has approved a company for investment, in most cases a private company with 50.000 DKK in capital is founded. Most often, the founder contributes 70 % of the company capital, while we typically contribute 30 %. The distribution of shares depends on the project, and other investors may also be part of the owners circle.
When the company is founded, Borean also grants a risk-bearing loan. Its size depends on needs and negotiations but will typically be about 2 – 3,5 million DKK. The loan is released in tranches on the basis of agreed-upon milestones and is used to cover development and operating costs. The interest rate is 8 % annually, which reflects the investment risk. It is the company which is responsible for the loan, with no personal risk to the founder.
When the company is operationally sound, the loan is paid off in step with earnings and profit. If this fails, or if other situations arise – for instance in connection with new financing rounds – Borean always works constructively and professionally to find a solution.
Second round of financing
Borean also commands a secondary investment framework of 2,5 million DKK. Borean’s secondary investment of up to 2,5 million DKK may maximally account for 40 % of the total secondary investment in the company. Therefore, the remaining 60 % must come from other investors who can contribute with a total investment of up to 3,75 million DKK.
Become a co-investor
At Borean we are always on the look-out for the businesses of tomorrow – the companies that have both the idea, the team, the talent and the ambition to succeed. At the same time, we are continuously in contact with private investors who wants and dares to invest early with companies showing potential, or who are potential buyers of a portfolio company. Browse through our portfolio, and if any company piques your interest, don’t hesitate to call us for further information.
CEO, Borean Innovation