EBRD Invests €10 Million in Baltic Venture Capital Fund to Boost Early-Stage Innovation

(IN BRIEF) The European Bank for Reconstruction and Development (EBRD) is backing the growth of venture capital markets in the Baltic states by providing a €10 million investment in Practica Venture Capital III, managed by Lithuania-based venture capital manager Practica Capital. This fund, which reached its final closing at €80 million in December 2023, will make equity and quasi-equity investments in innovative early-stage technology companies across Lithuania, Latvia, and Estonia. With a focus on companies developing cutting-edge technologies and digital or technology-enabled business models, the investment aims to enhance the access of highly innovative early-stage tech firms to equity financing, contributing to the competitiveness of local economies in the Baltic region.

(PRESS RELEASE) LONDON, 2-Feb-2024 — /EuropaWire/ — The European Bank for Reconstruction and Development (EBRD) is supporting the development of venture capital markets in the Baltic states by investing €10 million in Practica Venture Capital III, a fund managed by Practica Capital, a venture capital manager based in Lithuania. The fund will make equity and quasi-equity investments in innovative early-stage technology companies in the Baltic states.

The fund achieved final closing at its hard cap of €80 million in December 2023. Practica Capital will invest in around 20 early-stage technology companies based in Lithuania, Latvia and Estonia. In line with Practica’s experience, the fund will focus on companies developing innovative new technologies or those with digital and/or technology-enabled business models. It will primarily invest at the seed stage, while selectively exploring pre-seed and Series A opportunities for initial investments.

The Baltic states benefit from a number of factors conducive to the development of early-stage innovation, including high-quality human capital, a well-developed institutional environment and a growing number of experienced entrepreneurs starting new businesses or re-investing in the local market. The Bank’s investment aims to help to improve the access of highly innovative early-stage technology companies to equity finance and enhance the competitiveness of local economies.

Anne Fossemalle, Director, Equity Funds at the EBRD, said: “We are excited to support the further development of the early-stage innovation ecosystem in the Baltic states in partnership with Practica Capital, a leading venture capital firm based in Lithuania.”

Tomas Andriuškevičius, Partner at Practica Capital said: “We are thrilled to collaborate with the EBRD through its significant investment in Practica Venture Capital III. This partnership is testament to the trust and confidence a leading financial institution has placed in us. The EBRD’s commitment not only underscores the potential of the Baltic States as a hotbed of innovative technology startups, but also reinforces the importance of nurturing these early-stage ventures. This investment will undoubtedly catalyse the growth of ground-breaking ideas and solidify the Baltic region’s position as a powerhouse of technological innovation.”

The EBRD is a leading institutional investor in the Baltic states. To date, the Bank has invested €1.5 billion in 125 projects in Lithuania, €1.1 billion in 108 projects in Latvia and €935 million in 110 projects in Estonia. Promoting the development of capital markets and supporting digitalisation are two key priorities of the Bank’s work in the region.

The EBRD’s participation in the Practica Venture Capital Fund III comes under the Bank’s Early-Stage Innovation Facility II, a €200 million programme for investment in early-stage venture capital funds.

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SOURCE: EBRD