EIF’s €200 Million Equity Mandate Boosts Greek Innovation and Sustainability

EIF’s €200 Million Equity Mandate Boosts Greek Innovation and Sustainability

(IN BRIEF) The Hellenic Republic has entrusted the European Investment Fund (EIF) to manage €200 million from European structural funds and national resources to provide equity financing for Greek startups and SMEs in the life sciences, healthcare, and sustainability sectors. This initiative, signed in Athens by key officials including EIB Vice-President Ioannis Tsakiris and Alternate Finance Minister Nikos Papathanasis, aims to enhance access to investment finance for innovative companies, promoting competitiveness in global markets. The EquiFund II initiative builds on the success of its predecessor, EquiFund, which significantly contributed to Greece’s startup ecosystem, demonstrating the effectiveness of equity financing in nurturing SMEs and fostering technological advancements.

(PRESS RELEASE) LUXEMBOURG, 14-May-2024 — /EuropaWire/ — Greek startups and SMEs in life sciences, healthcare and sustainability will gain better access to investment finance under a new equity agreement managed by the EIF arm of the European Investment Bank (EIB) Group. Under the accord, the EIF has been entrusted to manage €200 million of EU Cohesion Policy Funds and national resources that will provide equity financing for risk finance investments in the country.

The equity mandate, signed today in Athens by EIB Vice-President Ioannis Tsakiris, Alternate Finance Minister Nikos Papathanasis, and the EIF Chief Executive Marjut Falkstedt, aims to help companies focusing on innovation operating in the targeted sectors get better access to vital equity financing to help them be more competitive and fully exploit their growth potential.

“The EIB Group has vast experience in deploying cohesion funding to mobilise private resources and accelerate investments for the real economy,” said Tsakiris. “Financial instruments are key in this respect; they leverage private capital to support the most dynamic, promising enterprises of Europe, while their revolving nature makes the best possible use of scarce public resources. The EIB Group has been supporting the Greek venture capital and private equity ecosystem since its nascent steps back in 2009; we are proud to have instrumentally contributed to its buildup and development. Successor initiatives like Equifund II, targeting risk equity financing in promising sectors of the Greek economy such as Life Sciences, will continue to play an important role in promoting cohesion, developing the growth of innovative companies in Greece and boosting competitiveness across the EU.”

“The expansion of the financing perimeter and the wider support of entrepreneurship, especially small and medium-sized and start-ups, especially when they are active in innovation and sustainability, are a priority of the government’s economic policy, with the aim of covering the investment gap caused by the crisis, extroversion trends, and the long-term change of the country’s production model. In this direction, a lot has happened in recent years, but we are not complacent. The challenges of the new era are continuous and cooperation with European organizations such as the EIB Group reinforces our choice not to waste a single euro of the available resources, for an even more competitive economy, for a more cohesive society, with more and better-paid jobs for all our fellow citizens”, said Papathanasis.

“We are delighted to be announcing the launch of EquiFund II, which represents a continuation of our successful partnership with the Greek government to foster the growing startup ecosystem in Greece. This new initiative reflects our common goal of unperturbed support for ambitious entrepreneurs with strong growth potential, at the same time driving innovation, competitiveness, social sustainability and jobs, this time with a specific focus in the Life Sciences and Social Sustainability sectors. These areas are among the most dynamic of the Greek economy and our continued support aims to further accelerate their development,” said Falkstedt.

The equity mandate will support new and/or existing fund management teams and aims to cover a financing gap identified in the life sciences, healthcare, and sustainability sectors, which are deemed to have promising growth potential but have relatively few financing options.

It will target investments in all asset classes, ranging from pre-seed, seed and early-stage investments to growth investments. As a result, it will support the whole investment spectrum of the venture capital and private equity ecosystem, depending on market needs.

EIF strong track record in Greece

The EIF continues to strengthen its agility as the risk-taking institution within the EIB Group focused on small and medium-sized enterprises (SMEs).

The EquiFund II initiative is the successor of the EquiFund equity mandate signed in 2016 and financed by European structural and investment funds (ESIF) resources, which helped boost the start-up ecosystem in Greece when it was still in an embryonic stage. That mandate provided equity financing for innovative companies and businesses in all investment stages and sectors of the economy via nine fund managers that focused on innovation, early stage and growth.

EquiFund is widely recognized at European Union level as one of the most successful examples of ESIF-supported equity financing and showcases the revolving nature of financial instruments as well as how they can nurture ecosystems in less-developed markets, help SMEs access risk finance and ultimately support them in developing technologies that compete at the global level.

Background information

EIB

The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances sound investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality. The EIB Group, which also includes the European Investment Fund (EIF), signed a total of €88 billion in new financing for over 900 projects in 2023. These commitments are expected to mobilise around €320 billion in investment, supporting 400,000 companies and 5.4 million jobs.

All projects financed by the EIB Group are in line with the Paris Climate Accord. The EIB Group does not fund investments in fossil-fuels. We are on track to deliver on our commitment to support  €1 trillion in climate and environmental sustainability investment in the decade to 2030 as pledged in our Climate Bank Roadmap. Over half of the EIB Group’s annual financing supports projects directly contributing to climate change mitigation, adaptation, and a healthier environment. Approximately half of the EIB’s financing within the EU is directed towards cohesion regions, where per capita income is lower. This underscores the Bank’s commitment to fostering inclusive growth and the convergence of living standards.

EIF

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe’s micro, small and medium-sized businesses by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment.

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SOURCE: European Investment Bank