Investing in European companies that employ 100 million people

Through crowdfactoring, you can invest in small and medium-sized European companies which employ 100 million workers across the EU

Companies need financing throughout their life cycle, from when entrepreneurs have an idea until the company has reached maturity and needs to reinvent itself to remain competitive. Therefore, raising finance and financial planning are strategic issues for all companies, not only for large companies but also for SMEs and European society as a whole, so much so that both traditional banking institutions and online alternative financing platforms have the mission of helping savers to devise investment strategies that allow them to earn money while investing in European companies.

The single market and the adoption of common regulations have contributed to the increasing integration of the European economy and society. SMEs in the European Union have played an essential role in this process, as they have expanded beyond their countries of origin and participated in the EU market.

This commitment to internationalization entails the need for financial resources to establish themselves in other countries and make the investments associated with this market diversification.

Thus, financing small and medium-sized European companies becomes paramount to help them grow and protect the 100 million jobs they generate throughout the EU.

In this article, we will take a closer look at the importance of investing in European companies and the role alternative financing platforms can play in providing SMEs with liquidity and helping them grow.

The Importance of SMEs in the European Economy and Society

Large companies are fundamental to the economy. They generate thousands of jobs, their taxes have an impact on the public purse, and their turnover has an impact on a country's GDP. But small and medium-sized companies are also crucial to society's future and the productive fabric.

The European Commission claims that SMEs account for 99% of all businesses in the EU. Furthermore, these companies employ 100 million people, accounting for more than half of the Union's GDP.

Beyond these transcendental macroeconomic figures, the fact is that SMEs play an essential role in the generation of added value and innovation in all economic sectors, including strategic sectors such as finance.

Investing in European companies thus becomes a central issue that transcends the companies themselves and involves the EU as a whole.

Obtaining financing is one of the critical issues for SMEs

Why is it so important for savers to be able to invest in European companies? Because access to finance is one of the critical issues for SMEs. Large companies have the necessary muscle to obtain financing. However, small and medium-sized companies can face greater hurdles in this essential task.

Fortunately, the digital revolution and the rise of disruptive technologies such as Artificial Intelligence or Big Data have made it possible to digitize the financial sector. The emergence of FinTechs has played a fundamental role in this, putting cutting-edge technological developments at the service of SMEs and small and medium-sized investors.

Crowdfactoring platforms such as Inversa Invoice Market use technology to speed up the calculation of credit rating or risk, promote the possibility of investing in European companies and increase the number of investors participating in the financial sector.

Banks and financial institutions in the traditional system continue to play a key role in investing in European companies and facilitating their financing. The various forms of alternative financings, such as crowdlending or crowdequity, complement their role, opening up the range of financing channels available to SMEs.

Crowdfactoring: Investing in European companies so that they can continue to grow

Many factors come into play in the success of a company. The value of its customer portfolio, the effectiveness of its commercial strategy, the quality of the goods or services it sells, the talent of its staff… Another factor is the possibility of being financed quickly, quickly, flexibly, and with affordable interest rates. And not a minor one, precisely.

An SME can be successful in what it does. Still, its problems in obtaining financing may mean that it needs to be able to adapt to changes or take advantage of the business and investment opportunities that arise.

Alternative financing, in general, and crowdfactoring are already very relevant when investing in European companies, allowing SMEs to contact potential investors.

On the Inversa platform, small and medium-sized companies can finance their invoices and anticipate their collection, thus achieving almost immediate liquidity.

At the same time, investors can take control of all their investments without leaving their homes. And invest in European companies that employ 100 million workers while earning a return on their savings.

All this is possible thanks to a platform that serves as a meeting point between SMEs and savers and allows investing in European companies by providing investors with all the information about the operation.

Betting on projects beyond national borders

As we pointed out at the beginning of the article, the common European market has encouraged the possibility that not only large companies can internationalize. This, together with digitalization, has contributed to SMEs being able to export their goods and services.

Well, crowdfactoring marketplaces such as Inversa also encourage the possibility that small and medium-sized companies can do business beyond national borders. How?

On Inversa, companies in the real economy can finance their invoices, regardless of the country where businesses need to pay them to operate. Many Spanish companies have already financed invoices from customers in Portugal, France and other EU countries. As well as from more distant states, such as China itself.

In this way, in addition to investing in European companies, their commitment to internationalization is encouraged, encouraging their exports and providing them with liquidity to export even more.

In short, SMEs are at the heart of European society and the European productive fabric. Small and medium-sized enterprises generate wealth and employ 100 million people. However, they need help accessing all the financing they need. Therefore, investing in European companies and providing a valuable economic return is of great value in supporting the real economy and creating quality jobs.