Those who invest in companies never get guarantees. That certainly applies to NOM, which also dares to take risks that commercial parties would not dare to take. 'If we have the confidence at the crucial points that it can succeed, then we go for it,' says Geert Buiter, manager NOM Finance. NOM also dares to say no, even under political pressure. 'We can always explain why we are or are not funding.'
NOM balances its way between multiple interests. For example, the organization is there for entrepreneurs, albeit always from the perspective of a robust Northern Netherlands economy. In doing so, NOM does not need to earn pockets of dividends for shareholders, although the organization does need some return for healthy operations. Moreover, NOM looks at what is important and necessary now, but also focuses on sustainable goals in the future. In short, NOM moves in a dynamic that has several sides. 'In our profession, we are constantly making trade-offs,' says Geert. 'And sometimes we encounter dilemmas in the process.'
Geert deliberately does not mention concrete examples - for reasons of confidentiality - but he does explain when a dilemma may arise. 'Employment is a crucial factor in our region and politicians like to score with the creation of new jobs. Of course we welcome new jobs or job retention wholeheartedly, but our job is to look beyond a political term. How sustainable is the business plan? How does the business fit into the Northern Netherlands' ambitions? And how sustainable is the business in the long term? Spreadsheets are willing, but more than just numbers count. We weigh all interests.'
'We can never predict the future,' Geert realizes. 'One of the most important lessons in this profession is that you never know for sure. NOM's challenge is to make choices with today's knowledge and with an eye to the future. In doing so, we rely on all our internal know-how and, where necessary, we call in expertise from within our network for advice or research. Every decision is preceded by a careful process. Trust and accountability are crucial. We have to see a company do it, and we have to be convinced that the company will add value to a robust economic structure.
In the background of every decision is the realization that NOM invests with public money. That also applies - and perhaps especially - when there is political pressure from a jobs perspective. 'We can only invest the money once,' the Finance manager emphasizes. 'Of course, we want nothing more than to drive entrepreneurship, and yes, we are there precisely to provide venture capital. That means we take more risks than commercial financiers. Moreover, we give companies time and space to blossom, even if it turns out that they need a longer breath than first thought. In short, NOM sticks its neck out when we are convinced of the potential. But we too must be able to complete the business adventures we embark on at the end of the journey.'
A good story
The NOM Finance team therefore never takes any chances. 'Entrepreneurs sometimes think it takes a long time, but it is precisely the diligence that we do that takes time. It is important to look behind the desired investment. What is the company focused on? On retention and continuity? On growth and expansion? Or do they want to become best in class? Development can be done in multiple ways, and we want to know what focus an entrepreneur has. We use a broad definition of innovation, because innovation can mean different things in different companies and sectors. As long as steps forward are made, with a good story behind them.'
'For us, a good story is above all a substantiated story. Moreover, we look beyond a business plan and intended market. We want to get to know the entrepreneur well; find out how he or she reacts if business takes a turn for the worse. Look, we take financial risks, but only if we have confidence in both the business and the person. Then it is important to know what you have in common. Again, you can never be sure, people are more difficult to judge than spreadsheets. But we do our best to look as deeply as possible before investing money. That's why we ask critical questions and take our time.
A dilemma that Geert also discusses periodically with the MT and his team is the question of whether it is smart to focus only on certain sectors when it comes to funding. 'From our broader significance as NOM, major themes such as water, energy, life science and agrifood have our explicit attention. Yet we cannot afford to invest only in these in the Northern Netherlands. The economic base is too thin for that, but more importantly, there are so many other valuable entrepreneurial initiatives that are important to the region. That is why - within the policy frameworks - we work with an open attitude, with an eye for all business opportunities that can strengthen our economic structure.'