Ljubljana, 29 November (STA) - The Economy Ministry signed the first of four agreements for funding of venture capital funds which support innovation at fast-growing companies on Monday. The state will earmark a total of EUR 21m as part of the project.
The agreement signed by Economy Minister Darja Radic and the Prvi sklad venture capital fund is the first of four scheduled to be signed this week.
As part of the agreements, the Slovenian Enterprise Fund will provide EUR 20.6m to the four venture capital funds as part of funding of venture capital support to prospective companies.
The venture capital funds will in return have to raise an additional EUR 21.6m in private money to invest in innovative projects by small and medium sized companies in fast-growing but high-risk sectors which have trouble obtaining loans.
For its investment, the state will obtain a 49% stake in the funds, giving it the power to check how the money is being used.
The four funds - along with Prvi sklad, the project includes Meta Ingenium, DTK Murka and Sklad poslovnih angelov - were selected in a public call for applications for co-financing of venture capital projects for a total of EUR 33.9m.
Head of the Enterprise Fund Maja Tomanic Vidovic said that two other applications were currently being reviewed. The call is open until the end of 2011.
Economy Minister Darja Radic stressed that the programme of funding venture capital funds represented a shift from a grant-based scheme of promoting enterprise to a loan-based scheme.
She said that this should help ensure better quality of projects applying for funds and provide for the replenishment of budget funds for use on future projects.
The ministry had wanted to establish a state-run venture capital fund initially, but instead opted to enter into joint ventures with private funds.
Radic said the government recognised that creating a large state-run fund would have hurt the development potential of private venture capital funds.