Small Business and Start-Ups

Small business and start-ups fulfil important macro-economic functions. They create jobs and stand for innovations. Such implications alone would justify a differentiated approach to the mulitute of financing methods, its problems and the apparent pecularities of this sector of familiy related businesses. Besides the high failure rate and the recent crisis of small business financing shows that the need for independant financial advice and research is increasing. Lately the discussion concerning new rating requirements (Basle II) and the idea of some banks to uphold small business finance either only in the form of a credit factory or through increased cross selling activities has risen further concern.

iff has concentrated in different research projects on very small credit for start-ups (Micro-Lending) it appearance, use and legal conditions, the use of law in small businesses crisis and the effect of its use on both partners and their settlements. It has further developed tools like a telephone helpline (FinanceCall), an internet based interactive information (FinanceInfo), a software to monitor and communicate liquidity and check cost and adaptation of financial services products (FinanceCheck) as well as a mutally used software tool to make communication between banks and small businesses easier, more steady and more reliable (FinanceCtrl). These tools are discussed within the internet co-operative and other partner have added their respective experience and information. A group of scientists from France, Italy and Germany has created the REPPE-Network (Reseau de recherche sur le Tout Petits Entreprises en Europe) on intermediation of information and at the Hamburg University of Economics and Politics a group has joined these efforts and linked it to the MBA Entrepreneurship programme of this university.

For the future a closer co-operation with chambers of commerce and small business administrations as well as specialised bank shall make these efforts effective.