English

Portuguese

Members Area

Swedish Venture Initiative (SVI), Saminvest, and Israel’s Yozma Fund 2.0 all employ a fund-of-funds approach, pooling public resources to invest in venture capital (VC) funds that target early-stage companies. This model encourages private investments by reducing risk exposure. For example, the Yozma Fund 2.0 will contribute 30 cents for every dollar of institutional investment in Israeli venture capital funds as part of the program.​Polish Development Fund and PFR Ventures utilize similar structures, through selected financial intermediaries, to channel funds into innovative SMEs, demonstrating the effectiveness of this approach in leveraging private capital.

Equity Financing and Fund-of-Funds Models

Many initiatives, such as Startup India Seed Fund Scheme, Startup Chile fund, Business Finland Venture Capital Funds, and South Africa's Technology Innovation Agency Seed Fund, specifically target early-stage companies, providing them with the necessary financial support to develop prototypes or conduct market trials. This focus aligns with global trends prioritizing innovation at the seed and startup stages, where traditional funding sources are often scarce.

Focus on Early-Stage Innovation

Most practices analysed benefit from government support, either through direct funding or by creating incentives for private investment. Initiatives like Singapore's Startup SG Equity and Canada's Venture Capital Action Plan (VCAP) exemplify how government backing is crucial in stimulating venture capital ecosystems.

Government Backing

Programs like the Enterprise Financing Scheme (EFS) in Singapore and the Proof-of-concept funding in the Netherlands highlight a broad approach, addressing various sectors, including technology, infrastructure, and social enterprises. This comprehensive support is vital for fostering a diverse innovation landscape.

Support for Diverse Sectors

The Israel’s Yozma Fund 2.0 features a distinctive structure aimed at encouraging institutional investment in Israeli venture capital funds by offering government co-investment (30 cents for every dollar of institutional investment) that enhances returns while waiving a portion of the returns. This creates favorable conditions for institutional investors.​In contrast, the Mansion House Reforms - LIFTS Initiative in the UK actively invites industry proposals for creating new funds, a proactive approach to attract institutional capital.

Investment Mechanisms

The Entrepreneurship Promotion Fund (EPF) in Lithuania focuses on disadvantaged groups, such as unemployed individuals and older entrepreneurs, showcasing a targeted approach to inclusivity.​Conversely, Singapore's StartUp SG Equity and Canada's Venture Capital Catalyst Initiative (VCCI) emphasize supporting underrepresented groups, such as women entrepreneurs, thus addressing systemic inequalities within the startup ecosystem.

Targeted Beneficiaries

There is significant diversity in the types of financial support available. For example, the Enterprise Financing Scheme (EFS) in Singapore offers a comprehensive range of loans tailored to different stages of business growth, creating a robust support framework for enterprises. In contrast, the Proof-of-concept funding in the Netherlands focuses specifically on loans to assess market feasibility for innovative ideas, targeting early-stage startups.​Additionally, Business Finland Venture Capital Funds in Finland concentrates on investments through venture capital funds, while the Loan Fund in Poland provides low-interest loans to businesses that have secured private investment, highlighting various strategies for funding innovation.

Type of Financial Support

Direct financial support for innovation provides essential capital to companies through equity financing, loans, and credit schemes, enabling them to develop technologies, scale operations, and commercialize ideas. Equity financing allows governments or institutions to invest in businesses in exchange for ownership shares, which is particularly beneficial for high-growth startups seeking funding without accruing debt. Loans and credit schemes, on the other hand, provide companies with favourable terms, such as low-interest or risk-tolerant loans, supporting both early-stage and mature businesses in their development while maintaining financial flexibility.