EquiFund is a new fund-of-funds programme, created by the Greek ministry of Economy and Development in cooperation with the European Investment Fund (EIF) to provide small and medium-sized enterprises (SMEs) with the private equity and venture capital ecosystem they need in order to thrive.
Small and medium-sized enterprises (SMEs) are responsible for two out of three jobs in Europe and often need access to equity financing to build and develop their businesses. Yet Greece has one of the lowest levels of venture capital and private equity activity of the whole EU, according to Invest Europe, the European venture capital and private equity association.
EquiFund aims to strengthen the venture capital market in Greece, in order to provide entrepreneurs with the crucial financing they need to grow their businesses (and attract private sector investment). Its goal is to attract private investment at all stages of entrepreneurship, from start-ups to mature expansion companies.
One of the largest public-sponsored programmes in Europe, the Equifund was launched with 200 million euro from European and national funds, 60 million from the European Investment Fund, 40 million from the European Investment Bank European Fund for Strategic Investments, the core of the so-called ‘Juncker Plan’ and is calculated to receive another 100 million from other private investors. In total, 400 million euro is expected to be deployed in the period 2018-2023 in venture capital investing.
EquiFund uses the innovative tool of equity financing: this is when an investor gives the entrepreneur money in return for a share in their business. In addition to capital, investors also provide valuable know-how and access to networks, helping entrepreneurs progress their venture or business efficiently and effectively. This combination of capital and know-how is often referred to as “smart money”.