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NextStage AM launches NextStage Championnes III to invest in French SMEs

NextStage AM, a specialist in growth equity in France, has held the first closing of its Relance-labelled NextStage Championnes III (Championnes III) fund, which will provide equity financing to innovative French SMEs established (particularly digital, environmental innovation, smart health). 

At present, the fund’s programme already has an investment capacity of EUR60 million. 
With Championnes III, NextStage AM rounds out its growth equity investment program for institutional investors, UHWN and family offices. The fund is looking at initial investment tickets of EUR4 million to EUR10 million in profitable companies currently achieving sales of EUR5 million to EUR50 million with strong growth potential, and profitable. NextStage AM is also developing several other growth equity programs, notably with their NextStage SCA vehicle, which targets investment tickets in excess of EUR10 million. 

While Championnes III enjoyed the backing of leading French institutional investors, including AXA France, Bpifrance, longstanding investors in NextStage AM who pledged their confidence anew, it also garnered support from new major private (entrepreneurs) and institutional investors (AG2R LA MONDIALE, Crédit Agricole Île de France, Caisse d’Epargne Côte d’Azur…) looking to strengthen their investment exposure to France’s local champions, something which is more crucial than ever, given the health crisis.

The Championnes III fund is also one of the first ten funds to have been granted the “Relance” label established and conferred by the French government. The label is designed to channel savings into those investment funds committed to swiftly mobilising resources to provide equity investments to SMEs and mid-sized companies located all over French regions. The fund includes enhanced ESG monitoring, with a particular focus on environmental innovation and carbon impact.  
With a total target of EUR100 million, the Championnes III fund’s investment program, complemented by the FPCI Capital Entrepreneur, a re-employment fund for entrepreneurs seeking access to the strategy developed for institutional investors, already has investment capacity of more than EUR60 million.

Championnes III offers an investment strategy capitalizing on NextStage AM’s recognized expertise in the realm of growth capital. Its predecessor launched in 2009, the FCPR NextStage Championnes II, made 11 investments, all of which were exited without any loss with an average gross IRR of 19.7 per cent and average gross multiple of X 1.9.   

Investors will benefit from the expertise of a dedicated team with extensive experience consisting of Nicolas de Saint-Etienne, Aloys de Fontaines, and Julien Potier, who are managing partner and partners of NextStage AM respectively. With 10 years working together at NextStage AM, the team has a solid track record and a demonstrated ability to support companies with structuring, integration of innovation and the acceleration of their growth in France and abroad. 

Championnes III’s strategy deliberately follows in the footsteps of that which made the previous vintage such a success. Now on the verge of making a first investment, in a company from the Rhône-Alpes region specialising in a digital service for SMEs, the fund is selectively considering several opportunities that should come to fruition over the coming months.

“In the recovery context associated with the Covid-19 crisis, we believe that the Champions III fund’s strategy is highly relevant. Right now, when the need to channel equity capital into French companies appears self-evident, our knowledge of the regional business landscape, our positioning as an entrepreneur-investor and our strong primary deal flow thanks to our proprietary network are all assets supporting the fund’s deployment. More than ever, our investment thesis resonates with our investors, who believe in meeting the challenge of supporting innovative gems in our regions with equity capital to ensure they become tomorrow’s champions,” says Nicolas de Saint-Etienne, Managing Partner at NextStage AM.

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