The inspiring career path of Jos Peeters, winner of the Lifetime Achievement Award

“I did not expect to win this award, but I am very honoured,” admits Jos Peeters when we visit him at the Capricorn Partners offices to review his inspiring career.” After all, a recognition of this kind indicates that you have not only meant something for your own organisation. The ecosystem in which you operate expresses a certain appreciation for the journey you have undertaken.” To state that Jos Peeters travelled an impressive path, is an understatement. He took a pioneering role in the world of Belgian and European venture capital and paved the way for many others. 

Uniting creativity and capital

In his acceptance speech, he called entrepreneurs and long-term investors “the universal way to create sustainable wealth and better living conditions for people and to mitigate the challenges we pose to our environment”. He gladly elaborates on that statement. “I am convinced that politics should be doing two things: creating the conditions in which a society can function and sanctioning the laws or rules that have been established. Societal problems are not solved by politicians. Entrepreneurs provide the solutions, move us forward and create wealth. And especially when it comes to new products or services, you need funding to do so. In the modern world, knowledge is one thing and capital another. The creative power does not necessarily lie with those who also have the capital. Therein lies the very role of venture capital or private equity: it unites the ideas with the capital. With capital that is patient and can deal with losses as well.” 

“I am convinced that politics should be doing two things: creating the conditions in which a society can function and sanctioning the laws or rules that have been established. Societal problems are not solved by politicians. Entrepreneurs provide the solutions, move us forward and create wealth.”

PhD in physics

As a teenager, Jos Peeters was particularly good at mathematics. It showed to be the fertile ground for his academic track and later for the first stages of his professional career. “I originally wanted to become an engineer, but after visiting the faculties I felt that the engineers didn’t really understand what they were doing. I was more attracted to the search for fundamental knowledge and started studying physics, in the turbulent 1960s in Leuven.” Thanks to a grant from the National Fund for Scientific Research (NFWO) and a healthy dose of diligence, it lead to a PhD degree. Afterwards, instead of becoming a professor, he ended up in industry. 

“I started at the Bell Telephone Manufacturing Company in Antwerp. An exciting period, as technological advances enabled the switch from electromechanical telephone systems to the first digital systems, which of course had a huge impact on production processes.” Next came a move to the English consulting firm PA Technology, which had just set up a branch in Belgium. “That was in the period when microprocesses saw their breakthrough, the beginning of biotechnology. Also, Flemish Prime Minister Gaston Geens launched the first fairs, Flanders Technology International. These fairs were a real eye-opener and immensely fascinating, because all of a sudden I could use my acquired knowledge in practical technological applications and apply it to help solve problems in companies all over Europe.” 

Pioneer

In 1985, after seven years as a consultant, Jos Peeters ran into the chairman of an investment bank. The latter had just set up his first venture capital fund, BeneVent Management, and was looking for a CEO with the required technological knowhow. “That is how I became a venture capitalist overnight, one of the first in Belgium and Europe. During my last years as a consultant, I was already linking up with the venture capital world. Here it was almost non-existent, but in Boston and Silicon Valley there was already some inspiration to be gleaned. The question was: how can we create companies with the knowledge we have and thus create economic added value?” 

At that time, ‘venture capital’ was an unknown concept. “It was really pioneering in those early days. I would sit at a dinner somewhere every week to explain what exactly that term meant. But it was really important to valorise the knowledge that was present in Flanders and Belgium. We had to create a new economic fabric. Not just through big companies, but also via start-ups and young companies.” Peeters never dropped that focus on early-stage companies. “Many of my colleagues have moved towards private equity and buyout, but I have always very consistently – a bit stubbornly perhaps – remained committed to young start-ups.”  

The magnum opus

After another seven-year stint, Jos Peeters set up his own ‘manager of venture capital and equity funds’, in collaboration with the UK-based Barings Group. Capricorn Partners was born and would grow into a leading player in the sector, nowadays managing 500 to 600 million euros. “We were actually impact investors avant la lettre. Because of the high risks we took, we were obliged to seek extra returns, but we also decided to only invest in matters that were positive for people and society. Ultimately, return is also a requirement to be durable. Being in business for more than 30 years does at least prove a certain level of durability.” 

To appropriately put the envisioned strategy into practice, Capricorn Partners selected three core themes or sectors: health, cleantech and the digital domain. Whereas the health section covers everything around biotech, medtech and digital health, cleantech is mainly about materials and sustainable chemistry. “Within the challenges of reduction of CO₂ emissions there has been a strong focus on renewable energy. However, large amounts of oil do not go to fuels, but to the production of plastics and materials. Therefore there is still a lot of CO₂ reduction to be gained in this area. Developing substitute materials or new production processes in that domain is an overlooked but perhaps greater challenge.” 

Capricorn was initially a one-person company, in which Jos Peeters assumed the role of CEO. Later, when the company stood on its own feet, a clear structure with an executive committee was created and Peeters evolved to the role of chairman of that committee. Now there is a strong 28-member team, there are several partners and Capricorn is running at full speed. In September, Jos Peeters could therefore take a step aside in peace. “It is a healthy decision with regard to the continuity of the company. You know your life is finite and you do not want your organisation to suddenly be faced with a fait accompli.” Day-to-day management now lies entirely with the executive committee, and Peeters himself is currently chairman of the board of directors. 

Inspirator and leading figure

The jury of the M&A Awards was unambiguous: Jos Peeters has had an indelible impact on our venture capital landscape. On the one hand through his achievements as such, but also due to the inspirational role he has adopted throughout his career. “I have strong opinions and dare to bring them up in a debate. Moreover, especially in the first 20 years, I gave countless lectures on venture capital, both in Belgium and abroad. I still regularly meet people who claim that my words there inspired them. That touches me.” 

“I did not expect to win this award, but I am very honoured”

Together with a handful of colleagues, Jos Peeters also stood at the cradle of the Belgian Venture Association (BVA) in 1986. “At the time, the Flemish government took a decision on loans that we considered market-distorting. Better than some self-serving individual protest, is a collective response. I was asked to assume the first chairmanship of that interest group.” And to this day, it is a very important institute. “It is a representative of the sector towards the government, which gives us the chance to obtain a correct legal fiscal framework, and also gives the necessary visibility to an industry that has grown enormously. On top of that, the BVA plays a vital role as a networking tool: the fact that you often take on a risk together with several other organisations in order to achieve something, makes it crucial to trust each other.” 

Later, Peeters was also asked to become chairman of the European Venture Capital Association (EVCA), where he established the foundations for the launch of a European counterpart to NASDAQ. “This was necessary as unlike American companies, our young companies were valued on their past to raise money and thus experienced a competitive disadvantage.” After a meeting between the European Commission and the EVCA, a taskforce was formed to look for solutions, with Peeters as chairman. He decided to not pen down a report and wrote a concrete business plan instead. Six months later, the EASDAQ stock market was launched. “The start was promising, as demonstrated by the 63 IPOs and the 6 billion euros raised, but competition from other stock exchanges and the implosion of the tech bubble forced an end to it. A pity, as to this day I am being called upon to re-launch it.” 

A gift of prophecy?

Another justification for this Lifetime Achievement Award, is his unique talent to foresee market gaps and proactively address them. While acknowledging the importance of the luck factor, Peeters also emphasises a number of qualities stemming from his training as a physicist. “From an economic perspective, unexpected events are problematic, but for a scientist they are just fantastic. That is because you learn something from these experiments. In addition, an analytical mind is useful to be able to distinguish between signal and noise in a context of thousands of mainly irrelevant data points, and to spot patterns and correlations. Furthermore, being able to deal with probabilities is crucial and a curious nature is definitely an asset.” Still, he has no crystal ball. “The most difficult thing in this sector is timing, and I usually get it wrong too. Although, fortunately, we have also been proven right a few times.” 

Although he may not be gifted with a crystal ball, his track record proves a solid talent for prediction. And therefore: how does Jos Peeters sees the future for the world of venture capital? “The near future will be quite critical. I expect a few difficult years, in which a number of players will disappear. With all the uncertainties in today’s world, it is currently quite difficult for companies to raise capital and bring funds together.” In terms of those uncertainties, Peeters believes there is surely also a political factor at play. “Look at the climate case, for example: the objectives are clear, but the path to achieving them is anything but clear and realistic. Or consider the tax reform proposal that was on the table this year; the most dramatic and negative thing I have seen in the whole of my career. If implemented like that, it would have undone 30 years of modelling a new economic fabric.” He concludes with a strong message. “There is no doubt that for all complex problems, we have to mobilise all the knowledge and resources available to arrive at solutions. But you should never do that through an ideological point of view. A perspective of rationality is the way forward.”