HandEX is revolutionising the market by using leading technology, to revamp processes and make it as easy as possible for exporters and importers alike to access the financing they need for international trade.
Today, if an exporter would like to search for financing for their exports, particularly to emerging markets for loans for an amount under EUR 5M (“small tickets”), they are frequently turned away by their bank. As much as 50% of “small-ticket” export finance loans are rejected by banks, even before appraisal.
HandEX is targeting SMEs with a mid- to long-term financing requirement of up to EUR 5M. Having founded less than a year ago, the team has built strong relationships with financing banks and insurance companies. HandEX facilitates and integrates the issuance of export loans and export insurance covers, including guarantees issued by the German government, for which the export credit agency Euler Hermes is mandated.
HandEX’s goal is to become the global export finance partner for SMEs, particularly “hidden champions”, to compete on the global stage. Many of these “hidden champions” in Europe, lose out to bids from other regions due to lack of corresponding financing products.
HandEX will focus initially on financially facilitating exports
of German mechanical engineering companies (“Maschinenbauer”) to the LATAM region
“Small-ticket export finance in particular as usually required for SMEs, causes us further problems. The SMEs lose out on taking on additional business, because the accompanying Hermes Guarantee is too much work,” explained Brodtmann, Managing Director of the Verband Deutscher Maschinen- und Anlagenbau (VDMA).
Germany has the highest exports per capita in the world and with macroeconomic conditions evolving rapidly, the importance of solidifying and growing international trading relationships dramatically increases. The “Maschinenbau”space is of particular relevance due to its high share of export business and primarily suffers from a lack of financing, as often reported by German press and associations, such as the VDMA. One such growing market for German “Maschinenbau” and other exporters is the LATAM region, especially in the context of recent political developments with respect to trade relationships. HandEX will therefore target German “Maschinenbauer” exporting to LATAM in the first instance, while already planning the expansion into other verticals and regions. Once established within Germany, HandEX will expand into other European markets.
“We’ve identified a gap in the funding market, which is of importance for the exports of the entire Eurozone, leaving SMEs at a detriment when competing on a global scale, even though the products are just as good, if not of a superior quality,” explained co-founder and CEO, Vincent Lauer.
He previously worked at Deutsche Telekom Capital Partners and Kreditech and is joined by co-founders Patrick Kupitz (CFO) and Asfandyar Malik (CTO). Both bring a great wealth of experience in the fields of corporate finance and FinTech, with Patrick having worked at Deutsche Telekom Capital Partners and Deposit Solutions, and Asfandyar as an early member of the Kreditech software team.
Loans originated through the HandEX platform are insured via the ‘Hermes Cover’. Demand for these insurance products has risen greatly of late and the easy to use, integrated platform offered by HandEX allows a customer to access a loan and/or insurance product in one single application, without needing to manage multiple complicated processes.
HandEX is solving a huge problem in the market
Tobias Schulz, Investment Manager at HTGF, provided his view on the topic: “As a fund, that is backed by the BMWi, we are well aware of the Coalition’s Agreement to support “Small Ticket” export finance for German SMEs. HandEX has come up with a fantastic solution to an age-old problem, to combine both export insurance and export finance in one streamlined process. Digitalisation in the space is still extremely low, with some four billion pieces of paper still in use within the market today. This leaves enormous room for cutting-edge innovation from HandEX to completely re-write the way export finance is handled today and in future.”
Through HandEX’s improved access to data and rapidly reduced time to issuance, HandEX has significant advantages over traditional lenders that retain paper-based processes, whose processes are staff intensive and time inefficient.
HandEX is pleased to be joined by the reputable German early-stage venture fund HTGF alongside prominent Angel Investors such as Andrew Shaw (Chairman of the Board, Coya AG), Ingo Saleck (Start-up investor) and others.