Venture Capital State Aid Program in Latvia（一）.pptVIP

Venture Capital State Aid Program in Latvia Martins Jansons Head of the Structural Funds Programming Unit The Ministry of Economics, Latvia General Background and Strengths Population of Latvia – 2.4 million Rapid GDP growth 99% of firms are SMEs “Latvia is ranked among the top ten counties worldwide in terms of business start up time and length of bankruptcy procedures.” Doing Business in 2004, World Bank Main Weaknesses Low entrepreneurial activity – about 20 enterprises per 1000 people Difficulties with access to finance for SMEs Limited knowledge among businesses of attracting the right financing to the business, in general, and about venture capital in particular Venture Capital in Latvia 35 funds have declared Latvia as their place of business Only a few actively operate in the Latvian market: Baltic-American Entrepreneurship Fund Baltic Small Equity Fund Baltic Investment Fund Askembla Growth Fund Baltic After-privatization fund Norwegian – Latvian Entrepreneurship Development Fund (inv. from 30 000 to 350 000 EUR), fully state-owned Lack of investments below 1 000 000 EUR Venture Capital in Latvia Improve the Access to Financing A need to develop new financial instruments The Single Programming Document (SPD): Venture capital Loan guarantees Loans Based on the SPD, the MoEc developed a state aid scheme for venture capital Objectives: Promote access to finance An ‘incubator’ for venture capital industry How? The State aid program implemented through a Fund-of-Funds (Latvian Guarantee Agency) Public Private Partnership Budget 15m € 75% from ERDF and 25% - the state budget Public investment in a Fund Up to 70% (target 50/50) No more than 5 m € in a single Fund Investment Fund Limited Partnerships with the life cycle of 10 years Managed by professional fund management companies Open tender procedure for fund managers – three funds State Support to Private Investors Restrictions for investment SMEs registered in Latvia Maximum investment 1m € in one proje