EIF selects two Venture Capital Funds for EUR 21m Bulgarian SME initiative

The EIF has selected Eleven and LAUNCHub to manage a EUR 21 million Entrepreneurship Acceleration and Seed Financing Instrument under the JEREMIE Holding Fund.

Eleven will manage a EUR 12million acceleration & seed fund with a view to making around200 investments in innovative young businesses. Investments into individual portfolio companies will typically be in the range of EUR 25,000 – EUR 200,000 per investee. The team is built around prominent professionals with substantial experience in the venture capital and private equity sectors in Bulgaria. Eleven has attracted Google as a technological partner, and Springboard - the London-based mentorship-led accelerator, as a strategic partner for its programme.

The other Fund Manager, LAUNCHub will manage a EUR 9million ICT focused fund, aiming to make around 120 investments over the next 4 years. Investments into individual portfolio companies will typically be in the range of EUR 30,000 – EUR 200,000 per investee. LAUNCHub partners with the largest early-stage micro seed investment fund and mentoring programme in Europe – Seedcamp and with the Cisco Entrepreneurship Institute Bulgaria. The team includes one of the most successful Bulgarian entrepreneurs in the ICT area – Lyuben Belov.

It is expected that the funds will start the investment process in the autumn of 2012. The EIF’s new Entrepreneurship Acceleration and Seed Financing Instrument is composed of two complimentary compartments, acceleration compartment - providing initial financing for proof-of-concept testing and seed compartment - providing follow-on financing to successful graduates from the acceleration compartment as well as to other viable early stage opportunities. The instrument is unique for the Balkan region and is expected to help to establish Bulgaria as the hub for innovation and start-up business on the Balkans.

This decision brings towards a close a process known as a ‘call for expression of interest' which attracted 11 applicant companies from Bulgaria for the Entrepreneurship Acceleration and Seed Financing Instrument. The EIF conducted a thorough analysis process to select the applicants against set criteria and using the EIF's Risk Capital expertise built up through investing into over 370 Funds across Europe over the past 15 years.

About the EIF

EIF's central mission is to support Europe's small and medium-sized businesses (SMEs) by helping them to access finance.  EIF designs and develops venture capital and guarantees instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. The EIF total net commitments to private equity funds amounted to over EUR 6bn at end 2011. With investments in over 370 funds, the EIF is a leading player in European venture capital due to the scale and the scope of its investments, especially in high-tech and early-stage segments. The EIF guarantees loan portfolio totalled over EUR 4.4bn in close to 220 operations at end 2011, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.

About the JEREMIE Initiative

JEREMIE (Joint European Resources for Micro to Medium Enterprises) is a joint initiative launched by the European Commission (Directorate General Regional Policy) and the European Investment Bank group to improve access to finance for SMEs in the EU within the Structural Funds framework for the period 2007 - 2013. JEREMIE enables the EU Member States and Regions to put money from the structural funds and also national resources into holding funds that can finance SMEs in a flexible and innovative way. The new initiative aims at developing and fostering the role of entrepreneurship within the EU in order to meet the objectives of the Lisbon agenda and help structural funds to deliver greater benefits to the market. At the level of the European Union, the EIF has currently signed 13 Holding Fund agreements.

In Bulgaria, the JEREMIE Holding Fund is financed from the European Regional Development Fund and co-financed by 15% by the State Budget within the framework of the Operational Programme Development of the Competitiveness of the Bulgarian Economy 2007 – 2013. Under JEREMIE Initiative in Bulgaria, EIF has developed instruments providing support at all stages in the development of enterprises in Bulgaria – Pre-Seed and Seed for emerging entrepreneurs, VC for the enterprises in their early stages, as well as Growth and Mezzanine targeted at more mature, established companies seeking expansion opportunities.

Press contact

EIF : David Yormesor, Communication officer, e-mail d.yormesor@eif.org