1.1 Eligibility criteria

What are the selection criteria for the Acceleration Program? 

In order to be eligible for the program, the entrepreneur must meet several criteria:

  • have a project with a positive impact or in a responsible way ;
  • have a MVP validated and is in the process of testing Product Market Fit  (first signs of commercial traction) and be scalable on its market ;
  • have operational and strategic needs to structure a first fundraising in seed and to accelerate development commercial ; ;
  • plan to raise funds in the coming year with financing needs ranging from €400k to €2M+.

1.2 The selection process

What are the different stages of selection? 

  1. First exchange in videoconference (30 min) with a Program Manager of La Ruche to discuss the start-up’s fundraising project and validate its eligibility for the Alliance For Impact Factory program (make an appointment via this link) ;
  2. Registration for the program on the Ruche platform: submission of financial elements (pitch deck/ BP) and an Impact assessment ;
  3. Analysis of the application by the team of La Ruche ;
  4. New phone exchange (30 minutes) to answer final questions about the program’s content and funding terms (see the FAQ’s OC section) ;
  5. Sign of the letter of commitment confirming the willingness of la Ruche and the entrepreneur to participate in the AFI Factory program ;
  6. Selection committee meeting with la Ruche, Ventech and the various LPs (AVIVA, Banque des territoires du Groupe Caisse des dépôts) of the AFI Ventures fund – One committee meeting every two months ;
  • 5-minute video pitch ;
  • 10-minute discussion. 


What do I need to prepare and submit to apply for the program? 

  • Financial elements of the project: Pitch deck and Business Plan ;
  • An evaluation of the impact measurement and the responsibility approach (ESG criteria).


What are the terms of the letter of commitment? 

By signing the letter of commitment, the entrepreneur confirms his willingness to participate in the support program and to make his best efforts to gather the necessary documents for the issuance of Convertible Bonds as soon as possible. 


How does the selection committee work? 

The selection committee can be held remotely by videoconference or in person at La Ruche’s offices (24 rue de l’Est, 75020 Paris). 

The interview takes the form of a 15-minute exchange: 5 minutes of pitch and 10 minutes of questions/answers with the jury; with the possibility of projecting a presentation. 

1.3 The content of the coaching program

What is included in the support program financed by the loan?

Under the AFI Factory program, incubatees will be able to benefit from individual, customized services over a 12-month period, including:

  • 12 diagnostic meetings with a Program Manager at la Ruche ;
  • 30 to 40 hours of strategic and financial mentoring or co-mentoring (with fundraising experts and/or impact entrepreneurs who have experienced the Product market fit and the journey all the way from Seed to Series A,B+ ) ;
  • 20 hours of consulting and coaching on operational issues (ticketing expert) ;
  • 1 to 2 “à la carte” services on priority issues depending on the targeted needs and the remaining support budget (UX audit, Pitch deck design, HR & management structuring, etc.) ;
  • 1 to 2 real-life situations with impact investors (2-hour investor and/or legal dry run) to prepare for the roadshow ;
  • Numerous introductions with our network of investors. 

The start-up can also benefit from collective services:

  • 2 days of Bootcamp introduction to the stages of fundraising and framing the road map ; 
  • Access to CO-DEVELOPMENT WORKSHOPS between entrepreneurs ;


The program also includes access to the ZEI platform to enable monitoring and steering of the impact measurement. 


Does the program provide access to investor contacts? 

The program provides access to an initial network of investors (investment funds, business angels, family offices, etc.), particularly during the Dry Run, during which the project leader practices pitching. Many introductions will be offered to the start-up, depending on the terms of its fundraising and the investment thesis of La Ruche’s partner funders.


What does the fundraising support consist of? 

The AFI program gives entrepreneurs the best chance of successfully raising funds and scaling up by enabling them to :

  • save time thanks to mentors and experts who accompany them on all aspects of fundraising ;
  • anticipate the stages of fundraising through the acquisition of core competencies, understanding the ecosystem and meeting with investors ;
  • prepare for the change of scale through continuous mentoring and impact measurement. 


If the fundraising takes place in the middle of the program, does the support continue? 

Incubation within the Alliance For Impact Factory program lasts up to 12 months. 

If THE STRUCTURE raises funds in the middle of the program, La Ruche will support the project holder in his or her post-fundraising needs and challenges thanks to experts and mentors. 

1.4 The terms of the accompaniment program

How is the program financed ? 

The AFI Factory program is paying. The cost of the accompaniment of € 25k exl. VAT is supported by an innovative mechanism of financing: the possible recourse to the emission of Convertible Bonds via AFI Ventures (find the questions relating to the emission of convertible bonds following).


Is it possible to benefit from the remote coaching program? 

Most of the coaching can be done remotely: diagnostic meetings, mentoring, ticketing expert, Dry Run, co-development workshops etc.

However, the first two days of the program’s Bootcamp take place in person at La Ruche’s event room in Paris. La Ruche will pay for travel expenses (train, bus, etc.) 


Is it possible to benefit from the support while being incubated elsewhere? 

Alliance for Impact Factory support can be complementary to any other form of incubation insofar as the other incubations are not dedicated to fundraising.


Is it possible to benefit from a place in the coworking space at La Ruche? 

It is possible to benefit from advantages within the coworking space at La Ruche (subject to availability). Indeed, incubatees can benefit from a 25% discount during the incubation period and a 50% discount for the 6 months following the incubation period. 


Are travel expenses for collective services covered? 

La Ruche is committed to paying for the travel expenses (train, bus, etc.) of entrepreneurs living in the region to enable them to attend the collective sessions.

2. The Abeille Assurances - La Ruche - Ventech Alliance

Why is the fund not managed by Abeille Assurances and La Banque des Territoires ? 

Abeille Assurances and La Banque des Territoires are not in the business of managing investments or holdings and has therefore asked Ventech to manage Alliance For Impact Ventures fund.


Who is Ventech?

Ventech is a management company specializing in third-party fund management, in particular through FPCI (Fonds Professionnels de Capital-Investissement), which are regulated financial vehicles.


What does Abeille Assurances fund?

Abeille Assurances, the first funder of the Alliance for Impact program and La Banque des Territoires du groupe Caisse des Dépôts have provided the program with a budget of 30 million euros for this first round of financing:

  • Alliance for Impact Factory: on the one hand, to finance the incubation and fundraising support program operated by La Ruche, for the projects selected for this phase ;


  • Alliance for Impact Ventures: on the other hand, for the equity financing of projects that will be the subject of an investment decision (among the projects benefiting from the incubation program and among third-party projects).

Does benefiting from the Alliance For Impact loan oblige me to make a capital increase with the fund or to have it participate in the future? 

Let’s be clear, no.

In the context of financing by CB, there is no obligation to use or involve the fund managed by Ventech. 

Conversely, participation in the incubation program is no guarantee of an equity investment by Ventech tomorrow.

Applications will naturally be presented to Ventech as part of the fundraising process and a favorable investment decision should be understood as a possible success of the program. You will be free to decide whether or not to proceed.


3. Characteristics of convertible bonds

What is a CB ? 

The term CB corresponds to the initials of an investment tool governed by the Commercial Code, the convertible bonds. 

That is to say a loan called “bond” which constitutes a debt and which can under certain conditions be converted into shares.

Within the framework of Alliance for Impact Factory, the convertible bonds allow to cover the 

cost of the acceleration program of € 25k excl.VAT and the costs of the statutory auditor of € 1.25k excl. VAT. The total amount of the convertible bonds will thus be €26.25k excl.VAT. 


Should the Alliance For Impact CBs be remunerated by interest, or are they free?

The loan proposed in the form of CB is interest-free. In this sense, it is free.

In other words, if the repayment of the loan has to take place at maturity, it will be done on a euro by euro basis. 

However, CBs are not similar to a grant. The principal amount advanced must be repaid at maturity.

The CBs mature 5 years after their issue if they are not converted in a capital transaction (no repayment before).


When and how are the CBs converted?

The CBs are converted into shares of your company.

The CBs will be converted in the event of a capital increase (legally, we speak of a capital increase), i.e. if the program is successful.

The CBs give the right to a certain number of shares of your company, which is determined by referring to the valuation retained in the framework of this fund raising, to which a discount of 30% is applied.

The discount and the conversion formula are specified in the explanatory e-mail and will be precisely stipulated in the issuance contract of the CBs.


Why a discount and what is its impact on the total dilution?

The discount that will be applied in the context of the conversion if a fund raising takes place materializes the risk of the financing by CB which takes place earlier than the financing in the context of the fund raising. 

Upon request, we can provide you with examples allowing you to appreciate the dilutive impact of the discount.


Why proceed with the issuance of CBs rather than any other legal tool? 

This choice responds to regulatory constraints. Because of the banking monopoly, neither Aviva nor Alliance for Impact are authorized to grant loans. 

However, Alliance for Impact can subscribe to bonds. 

The convertible nature of the bonds makes it possible to achieve a long-term balance and to perpetuate the support and investment program, while avoiding a sudden and excessive cash outflow for the issuing company.

It is moreover because the bonds constitute a loan that adds to the liabilities of a company that the Commercial Code requires that the issue of bonds by a young company – a company whose accounts for the first two financial years have not been approved by the shareholders – be preceded by the intervention of an auditor responsible for verifying the value of the company’s assets and liabilities. Such a verification of the value of the assets and liabilities should allow the shareholders of the company to validate the issuance of bonds with full knowledge of the financial health of the company.


What is the process for issuing the CBs?

The issuance of the CBs is the responsibility of the general meeting of your company, according to the conditions of quorum and majority imposed by your articles of association, and your shareholders’ agreement if applicable.

As explained above, the French Commercial Code requires that the issuance of bonds by a young company – a company whose accounts for the first two fiscal years have not been approved by the shareholders – be preceded by the intervention of an auditor in charge of verifying the value of the company’s assets and liabilities. Such a verification of the value of the assets and liabilities should allow the shareholders of the company to validate the bond issue in full knowledge of the financial health of the company.

The bondholder must then sign a subscription form for the CB.

Finally, a contract for the issuance of the CBs is signed between the bondholder and the issuing company.


What are the costs associated with the issuance of the CBs?

The issuance of the CBs generates costs related to (i) the holding of the General Meeting and more generally the production of the legal documentation and (ii) the drafting of the mandatory report(s) by an auditor and the related legal operations.

The legal costs are borne by the fund, but the fees of the CAC must be covered by the company that mandates him. Nevertheless, the amount of the CBs may cover the CAC’s fees if you so decide, so that these fees do not burden the company’s cash flow.


Will the issuance of the CBs have a negative impact on the rights of the existing partners?

No, subject to compliance with the specific clauses provided for in the company’s articles of association or, if applicable, in the shareholders’ agreement.

Eventually, the conversion of the CB into shares will have a dilutive effect on all the associates.

In the absence of conversion, the company reimburses the CBs in euros, without interest, which is favourable to the company as well as to all its associates.


Does the issuance of the CBs allow for an early exit from Alliance for Impact ? 

The issuance contract provides for the possibility of an early redemption of the CBs at the initiative of the Company subject to the agreement of Alliance for Impact.


What does the amount of €25k HT cover? Will my company have to pay VAT on top of the €25k it receives? 

The €25,000 excl. VAT covers the support provided by the Hive to help you prepare for the fundraising and to help you scale up.

The program is described in part 1. of the note.

Please note that the €25k excl.VAT paid to The Hive are exclusive of tax. There is therefore a 20% VAT to be added, although this VAT is considered deductible.

The €25k excl.VAT does not include: the legal or CAC costs necessary to issue the CBs. 

It also does not include the legal cost of accompanying the fundraising for the closing (these costs are generally included in the financing needs, and therefore covered by the amount of the fundraising).


Does La Ruche take an equity stake in our company?

No. At no time does La Ruche take an equity stake in your company: we are only a support operator.


Is the fund associated with other funds, and if so, which ones? 

The fund is not “associated” with other funds.

The fundraising support will connect you to the ecosystem of investors and allow you to meet your financing needs through different levers: debt, round table with several investors…


Once the participants are selected, does the AFI Ventures fund commit to invest? 

The AFI Ventures fund never commits to invest: its members are part of the jury of the AFI Factory selection committee which will select startups it believes in for the support program, to the point of advancing them the costs of this support, in the hope that their overall raising will be a success and with the view that AFI Ventures will be part of the round, which does not represent a commitment.


What are the valuations applied in the context of a fundraising during the seed phase?

The market practice for seed investment in France is to exchange a company’s capital between 15% and 25% for money (this range is indicative and can be adjusted according to the different parameters of the fundraising project).


Wouldn’t it be possible for the fund to simply take on the €25k excl. VAT by paying it like a classic fee for a “business contributor”? 

The fund’s operation is based on a virtuous mechanism that allows it to finance the support of entrepreneurs and to invest: there is no business contributor mechanism.

What can I expect when raising with AFI Ventures?

We will usually be followers and agree on your lead investor terms. In specific cases such as small pre-seed rounds (< 500k€) we are able to lead in case we are the sole institutional investor taking part in the round.

How much does AFI Ventures typically invest ?

We can invest up to 500k€ in total however our average ticket size ranges between 150k€ and 250k€.

Do I have to go through AFI Factory to get an investment from AFI Ventures?

No, we can invest in every company, coming from AFI Factory or not.

What’s your investment process like and how long does it take?

We commit ourselves to deliver you an answer within 3 to 4 weeks after we first speak. However, as far as we are willing to fast track the investment process, there are times where we might need slightly more time especially in case of bank holidays and/or during busy periods.

Our investment process is broken down in 4 steps as follow: Initial presentation (Deck/Case review) Due diligence (Market deep dive & business model) Referral checks (calling your customers & stakeholders) Committee (meeting with the rest of the investment team)

Do you have standard legal documents that you like to use?

We will usually follow your lead investor terms however in the (rare) event of us leading the round we will be using our standard term-sheet that you can find here.

What kind of companies are you looking for?

Above all we are looking for inspiring entrepreneurs willing to change the world for a better good; addressing a real problem of our society through an innovative solution producing a positive impact in a big-enough market to reach a critical business size at scale.

Do you invest in specific sectors?

We currently are sector agnostic, however we do put a strong emphasis on the impact your company is able to produce. This notably includes an impact assessment during our investment process.

Do you help companies syndicate their round?

As soon as you reach advanced talks with our investment team you can expect to be introduced to fellow investors of our network as well as business angels of our community if your company is aligned with their interests.

Do you agree to sign NDAs?

We don’t and for obvious reasons.

Do you invest in a specific geography?

We are currently investing in Europe-based companies only. If your company is headquartered in Europe but has operations elsewhere in the world that is not a problem.

Will you be required to sit on the board of my company?

We won’t require a formal board seat as we think our biggest contribution is driven by our community. In some specific cases we might require a board observer seat to keep ourselves up to date with the company’s latest developments.

Do you do follow-on investments?

Yes, we can double down the original invested amount.