How to fund high-growth startups in Europe

Luisa Alemany found there were no useful resources on entrepreneurial finance in Europe – so she wrote the definitive textbook


What do you do if you need something, but the thing you need simply doesn’t exist?

If you’re an entrepreneurial sort of person, the chances are that you will simply make it yourself. Which is precisely what Dr Luisa Alemany has done.

Dr Alemany, Associate Professor of Management Practice in Strategy and Entrepreneurship and Academic Director of the Institute of Innovation and Entrepreneurship at LBS, has a string of prestigious credentials in all things entrepreneurial.

Her latest accomplishment, however, is arguably one of the most impressive. Together with Job J. Andreoli of Nyenrode Business Universiteit (The Netherlands), Dr Alemany has authored Entrepreneurial Finance: The Art and Science of Growing Venturesthe first definitive guide to funding, scaling and harvesting from startups in Europe.

The book is a step-by-step guide covering every stage of the entrepreneurial finance life-cycle; from sourcing early stage funds to leveraging financial tools for growth; from navigating challenges to determining the right moment to exit. In 2021, it picked up the Textbook and Academic Authors Association prize for the ‘Most Promising New Textbook;’ official recognition of its unique value, and of the fact that it is – quite literally – the first book of its kind.

“There just wasn’t a practical book out there on financing startups in the European or international context,” says Dr Alemany. “It simply didn’t exist.”

There’s no shortage of titles and tomes on entrepreneurial finance in the US and Silicon Valley in particular – there, she says, it is simply “part of the culture”. But on this side of the Atlantic or other regions around the world, there is a long-standing shortage of serious literature. So much so, that academics teaching entrepreneurial finance courses in European business schools have traditionally had to pull together teaching resources from “sundry articles and book chapters.”

“I’ve been researching and teaching entrepreneurial finance for almost two decades, and it’s been a constant issue for me and for all of my colleagues. You’d have to select material from chapters here and there and print them off. My teaching resources have historically been reams of print outs – photocopies stapled together as thick as two books.”

An invitation to lead a workshop at a Harvard Business School consortium of entrepreneurship education in 2016 sparked an idea: to do something about this.

“There just wasn’t a practical book out there on financing high growth startups in the European context,” says Dr Alemany. “It simply didn’t exist”

It was during a conversation in Boston with Andreoli, who heads up the team at Nyenrode’s Incubator, that Dr Alemany conceived the idea to create the book that she and her colleagues so badly needed.

“When we put the idea out there to fellow academics and practitioners both at Harvard and then in Europe, there was an immediate upswell of support. The necessity was clearly there for the European market; and so too was the opportunity.”

There’s something meta – an entrepreneurial dynamic – to the way that the book itself was devised that Dr Alemany finds pleasingly apt.

“We conceived it very much the way you conceive a startup. We looked at the need, did the market analysis, identified the necessary resources, put together the dream team of contributors and scouted for the right publishers. And we plotted this initially in an index written on a napkin over dinner in Amsterdam,” she laughs.

Entrepreneurial Finance: The Art and Science of Growing Ventures is very much a “how to do it.”

While it draws on the collective expertise of many of Europe’s foremost researchers, it is not a work of scholarship per se, says Dr Alemany, but rather a highly practical and holistic guide to each phase of the entrepreneurial finance journey. Chapters are authored by subject matter experts – professors and practitioners from leading business schools and institutions, such as INSEAD, IMD, Bocconi, ESADE, Cambridge Judge or Bocconi and also includes experts from the European Investment Fund, the largest investor in venture capital funds in Europe. Identifying and recruiting these contributors, Dr Alemany says, was straightforward.

“I knew the people. I’ve been working in this space for years, so my European network in entrepreneurial finance is extensive.”

That said, she and Andreoli were careful to select experts with deep experience in Executive Education; faculty and practitioners who were used to teaching business executives.

“This book is designed primarily to be useful to practitioners, so the language had to be right. We had to adopt a tone that was concise, even conversational, so that the content would be clear, and each insight totally actionable. Every collaborator, every chapter author in the book is an expert in their field, but also expert in speaking to real-world practitioners.”

For these experts, the incentive to contribute was as much to service their own needs as those of entrepreneurs and investors, says Dr Alemany.

“We all felt we had to write this book for the European startup scene, but also because we needed it ourselves, to teach. It’s the resource that every contributor has been wanting to have for a long time. As part of the long publishing process, Cambridge University Press invited a selection of 12 blind reviewers – faculty of entrepreneurship – to come in and do a review of an example chapter.  Straight away, 11 of them told us they wanted this book tomorrow!”

Entrepreneurial Finance: The Art and Science of Growing Ventures has value for every player in the startup finance scene in Europe. The book is purposefully crafted and enriched with case studies and anecdotes to provide essential insights not just for entrepreneurs, investors and scholars, but also for all those involved in the process of financing new ventures, such as lawyers, consultants, auditors, investment bankers and policy-makers, Dr Alemany says.

It is organised into successive chapters that cover funding sources and processes, through to growing the venture, monitoring, corporate governance and managing intellectual property. Section Four explores “alternative” routes to finance, including acquisitions, turnarounds and workouts, and impact investing. The final part looks at exiting and the harvesting strategy, and closes with a meditation on the future of entrepreneurial finance – and this is a space, she adds, in a state of continuous evolution.

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“That’s the thing that makes entrepreneurial finance so very exciting. It’s just evolving all the time. Regulations evolve, so too do sources of finance. Increasingly we are seeing entrepreneurs doing things like direct listing – doing their own IPOs. Then you have the growing trend of ‘super angels’ competing with venture capital or large rounds of financing coming from crowdfunding. And we are still to see the impact of new technologies like Blockchain and crypto. It’s a constantly changing space.”

Dr Alemany acknowledges that there is a challenge in writing a definitive textbook – one capable of encapsulating such a very dynamic space for any length of time.

“Clearly, we will need to update the book as necessary, and that’s something that Job and I have very much on our radar. But this isn’t a problem, really. I think that the thing that defines your work as an academic is the way that different aspects of what you do overlap and complement each other. Your research, your teaching and your writing, all of these dimensions feed into and enrich each other. If my purview is to understand what’s happening in entrepreneurial finance, then all the work that I do, including the book writing and publishing new case studies in the topic, creates a kind of virtuous circle of investigation that keeps on enriching itself.”

Besides future updates, Dr Alemany and Andreoli are also keen to service other geographies.

An edition looking at Asia – and venture capital is China in particular – is planned for release later this year. And a future edition focused on Latin America is in the works. These are resources needed just as acutely as the European publication, says Dr Alemany. And exciting new ventures for herself and for her co-author.

“With this first book we identified the opportunity, scouted out the market and put together the resources and processes. The experience of writing has given us the insights, expertise and knowledge, as well as that feeling of resilience that is such a fundamental part of the entrepreneurial mindset. It will be exciting to put all this to test again in new markets that are growing rapidly in the financing of new ventures.”

Entrepreneurial Finance: The Art and Science of Growing Ventures by Dr Luisa Alemany and Job J Andreoli is published by Cambridge University Press.


Institute of Entrepreneurship and Private Capital

This article was provided by the Institute of Entrepreneurship and Private Capital whose aim is to inspire entrepreneurs and investors to pursue impactful innovation by equipping them with the tools, expertise and insights to drive growth.