EIF and EstFund commits €60m for investments into Estonian SMEs

EIF and EstFund commits €60m for investments into Estonian SMEs
These two new investments into Estonian SMEs have been signed under the EstFund

Through EstFund and the European Investment Fund (EIF), KredEx (a financing institution helping Estonian enterprises develop quicker and expand more safely to foreign markets) are announcing two new investments into Estonian SMEs – Equity United PE I and Tera Ventures Fund II.

These two new investments into Estonian SMEs have been signed under the EstFund – an initiative created by co-operation between the Republic of Estonia and the European Investment Fund and financed under European Structural and Investment Funds.

EIF’s Chief Executive Pier Luigi Gilibert, said: “With this investment into Tera Ventures Fund II and Equity United PE I, the EstFund and EIF aim to support many innovative promising Estonian enterprises. There are currently only a handful of early-stage equity investors active in the Estonian market, and these investments should play a catalytic role in promoting an underserved part of the equity market and supporting the SME eco-system in Estonia.”

What will the investment focus be?

Tera Ventures Fund II will focus towards venture capital investments into innovative early stage companies. Equity United PE I will provide expansion capital to SMEs with high growth potential that are aiming to expand to new products or markets.

According to the EIF, a third investment under EstFund was signed at the end of 2017 into the United Angels Co-investment Fund I, that is now actively co-investing together with the other private investors into early stage SMEs.

KredEx Chief Executive, Lehar Kütt, commented: “Announcing these EstFund’s investments, KredEx marks a further step towards the development of the Estonian venture capital market. By mobilising other investors, including funds from the private sector, this is expected to result in overall investments of almost €100m that would further help to build successful companies in Estonia.”

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

It underlines the importance of continued support to the development of the equity sector in the region which is important in fostering high growth innovative SMEs.

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