Estonian companies to get around €100 million with help of EstFund

Estonian state-owned financial institution KredEx, via the EstFund initiative and the European Investment Fund (EIF), has made two new contributions to the Equity United PE I and Tera Ventures Fund II investment funds.

Together with capital from private investors, this means in practical terms that approximately €100 million is to be made available for Estonian companies - writes err.ee

"In announcing these EstFund's investments, KredEx marks a further step towards the development of the Estonian venture capital market,'' said KredEx chief executive Lehar Kütt.

"With this investment in Tera Ventures Fund II and Equity United PE I, EstFund and the EIF aim to support many innovative promising Estonian enterprises,'' he went on.

Pier Luigi Gilibert, chief executive of the EIF, added that '' There are currently only a handful of early-stage equity investors active on the Estonian market, and these investments should play a catalytic role in promoting an under-served part of the equity market and in supporting the SME (small and medium-sized enterprise) eco-system in Estonia.''

Investment funds for incubating innovators

Tera Ventures Fund II is due to focus on venture capital investments in innovative early-stage companies. Equity United PE I on the other hand will provide expansion capital to those SMEs with high growth potential which are aiming to expand to new products or markets.

Before starting actively investing in the Estonian market however, the fund managers apparently need to raise additional resources from private investors, which is due to be completed in the following few months, it is reported.

EstFund goals

EstFund aims to develop the early and expansion stage equity market in Estonia by providing equity financing to high growth SMEs and attract private investors to the local market.

KredEx starts accepting home grant applications

EstFund is an equity fund of funds created by cooperation between the Republic of Estonia, KredEx and the European Investment Fund. EstFund is financed by the European Regional Development Fund from the Operational Program for Cohesion Policy Funds for 2014-2020 to the tune of €48 million, with the EIF co-investing €12 million alongside via EIF-managed resources. These funds are earmarked to offer equity financing from seed to growth for Estonian SMEs via the selected equity funds.

A third investment under EstFund was signed at the end of 2017 in United Angels Co-investment Fund I, which is now actively co-investing together with the other private investors in early stage Estonian SMEs.

These transactions complete the fund managers' selection process under EstFund, managed by the EIF on behalf of the Estonian Ministry of Economics and Communications and KredEx.

This underlines the importance of continued support for the development of the equity sector in the region, which is of key importance in fostering high growth innovative SMEs and hence economic growth.

Role of EIF and KredEx

The EIF is part of the European Investment Bank group. Its central mission is to support Europe's micro and SME businesses by helping them to access finance. The EIF designs and develops both venture and growth capital, guarantees and microfinance instruments, which specifically target this market segment. In this role, the EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.

KredEx is a financing institution which helps Estonian enterprises develop quicker and expand more safely in foreign markets, offering loans, venture capital, credit insurance and credit guarantees backed by a state guarantee.

Editor: Andrew Whyte

Source: BNS

Read more news of Tallinn on our site.

err.ee
KREDEX EUROPEANINVESTMENTFUND ESTFUND ESTONIANSMES VENTURECAPITALINESTONIA
If you notice an error, highlight the text you want and press Ctrl + Enter to report it to the editor
3 views in march
I recommend
No recommendations yet

Comments

Post your comment to communicate and discuss this article.

Politics
Chairman of the Estonian Chamber of Commerce and Industry and one of the owners of construction group Nordecon, Toomas Luman, finds that a prime ministerial candidate should first and foremost be able to answer the question of what will become of the demographic crisis in Estonia. The businessman sees controlled introduction of foreign labor as the solution. A digital construction cluster was created in Estonia a few years back to bring innovation to the s...
Society
Last year saw 27,125 registered offenses, up 0.5 percent from the year before. Violent crime was up by 12 percent to 8,249 offenses. PHOTO: Dominic Lipinski / PA Wire / Press Association Images / Scanpix Growth was biggest for domestic violence – the police launched criminal proceedings in 3,607 cases that constitutes an increase of more than one-third – annual growth of 37 percent from 2,632 cases in 2017. At the same time, reports of domestic violence we...
Society
TALLINN - Ahead of the withdrawal of the United Kingdom from the European Union, tens of thousands of British citizens have chosen the citizenship of some other country, but only one Brit has recently chosen an Estonian citizenship. Spokespeople for the Ministry of the Interior told BNS that only one British citizen submitted an application for Estonian citizenship last year and the applicant was also granted the citizenship. Before that, no Brits had soug...
Society
TALLINN - Experts from Finland, Denmark, Norway and the Netherlands highlighted the importance of decentralization and granting local governments greater decision-making powers at a conference titled "Strong local government -- strong state?" in Tallinn on Wednesday.  All Nordic countries have chosen a model granting local governments significant decision-making powers, thus the central government does not prescribe how local governments are to fulfill the...
Society
The language learning application Drops by game developer Planb Labs, established in Estonia by Hungarian founders, was named Google Play's best app of 2018. With the number of downloads surpassing 10 million, Drops was named Google's app of the year as the revenue of Planb Labs, a company registered in Estonia, increased fivefold, CNBC said. The developer's revenue grew from €335,000 in 2017 to €1.7 million in 2018. The company's shareholders include Hung...
Society
TALLINN - The Estonian Health Board has banned the distribution of chlorine dioxide, also marketed as the Miracle Mineral Supplement (MMS), the A-component of an unused product, meaning the sodium chlorite solution, must be taken to a hazardous waste collection facility. Ester Opik, head of the Health Board's North regional department, said that the banning of the distribution of the product was caused by the fact that MMS, distributed as a cosmetics produ...
Society
Nature cannot abide a vacancy, as the saying goes. If just one year ago, Estonia was battling the sale of MMS and the practice of giving it to children, a new “miracle cure” called Advanced TRS has appeared on the market now. Even though the make-up of the substance is different, the promise to cure autism and cleanse the body of heavy metals, which kind of extreme detox is accompanied by severe side-effects, sounds all too familiar. TRS is recommended to...
Society
Allied NATO battalions will soon mark two years serving in the Baltics. They have worked better than expected but would need prepositioned heavy weaponry and a functional contingency plan in case of a crisis, a report by the International Center for Defense and Security (ICDS) finds. “We do not know how Russia would have acted had we not welcomed allies in Estonia, Latvia, Lithuania and Poland in 2017. I’m afraid they would have tested our resolve,” one of...
Society
The time of filing income tax returns is nearly upon us. The new income tax system, in effect since last year, will obligate many women who went on maternity leave toward the end of the year to make additional income tax payments, while those who give birth in the middle or at the beginning of the year have no such obligation. What this means is that some women will owe the state simply for giving birth “at the wrong time”. Laura Roop, who went on maternit...