Seed and Venture Capital for investing into Slovak Start-ups and growing companies under JEREMIE

The European Investment Fund (EIF), on behalf of Slovenský záručný a rozvojový fond s.r.o. (SZRF), is supporting high-potential SMEs and start-ups across Slovakia through capital commitments to three funds under the Joint European Resources for Micro to Medium Enterprises (JEREMIE) initiative, with the two selected Fund Managers set to invest in the region of EUR 50 million, together with co-investors, into more than 50 promising Slovak Small and Medium-sized Enterprises (SMEs).

Neulogy Ventures has launched an Innovation Fund targeting seed investments, as well as an Entrepreneurs Fund for supporting the international ambitions of established, but growing companies, both primarily focused on the information and communication technology, new energy and medical diagnostics fields. In total, Neulogy Ventures will be managing approximately EUR 23m.

Limerock Fund Managers will have EUR 12m available for investment into attractive businesses in need of further capital for growth, through its co-investment fund, which will invest alongside private investor syndication partners, meaning that the total funding will be in excess of EUR 24m. Limerock Fund Managers will have a generalist sector approach, and will mainly target companies outside of Bratislava region with a scalable product/service, a competitive advantage and the potential to penetrate international markets.

Commenting on the new operations, EIF Head of Regional Business Development Hubert Cottogni said: “Venture Capital and other early stage equity investment is still relatively underdeveloped in Slovakia, especially when it comes to fund managers deploying capital raised from private, professional investors and institutions, and operating according to best market practice and industry standards. With these investments, EIF/SZRF is supporting two Fund Managers that we believe can accelerate the development of an equity financing ecosystem, which is a vital component to the overall provision of finance to support innovation, entrepreneurship, growth and jobs”.

The State Secretary of the Ministry of Finance of the Slovak Republic Vazil Hudak said: “The launch of the Venture Capital and Seed funding under the JEREMIE initiative can be considered as a breakthrough and a good example of how to use public funds to support entrepreneurship and innovation in the Slovak economy. With private co-investors, this is also the kind of partnership with the private sector the state is seeking, mobilising private capital so crucial to the growth of our economy, especially in these times of still somewhat insecure economic climate. May this be the beginning of much wider venture capital investments in Slovakia.”

Managing Partner of Neulogy Ventures Ivan Stefunko commented on the launch of the funds: “We have been observing a growing interest in technological entrepreneurship in Slovakia for a few years. The start-up ecosystem is shaping up, but we're still missing early-stage financing. Finally, innovative companies in Slovakia will have, like their counterparts in other European countries, access to seed and VC funding, and compete on the global level with their technologies and ambitions. We are committed to being a valuable partner to our future portfolio companies. At the same time, we are proud to be managing a fund on behalf of 34 institutional and private investors, including some of the most successful hi-tech entrepreneurs in Slovakia."

Partner of Limerock Roman Cmelik said of the commitment from EIF/SZRF: “With the help of the JEREMIE initiative, we aspire to provide capital and experience of many years of advising to entrepreneurs to existing businesses or to new projects. Our investment strategy will be focused on companies which will demonstrate technological advantage or uniqueness, and whose products or services have an innovative aspect. We want to support companies that will expand their successful businesses or will succeed in growing from early stage to a more developed phase and are looking forward to help Slovak talent to overcome challenges to achieving success".

These commitments result from a Call for expression of interest, targeted to select the best applicants to operate as Fund Managers in Slovakia. The Call was part of the implementation in Slovakia of the JEREMIE initiative, financed by the European Regional Development Fund within the framework of the Operational Programmes “Research & Development” and “Bratislava region” for 2007 - 2013. Slovak SMEs are already benefiting from loan finance provided at preferential conditions by five banks implementing previously launched instruments under the JEREMIE initiative.

About JEREMIE

JEREMIE (Joint European Resources for Micro to Medium Enterprises) is a joint initiative launched by the European Commission (Directorate General Regional Policy) and the European Investment Bank Group to improve access to finance for SMEs in the EU within the Structural Funds framework for the period 2007 - 2013. JEREMIE enables the EU Member States and Regions to put money from the Structural Funds and also national resources into holding funds that can finance SMEs in a flexible and innovative way. The new initiative aims at developing and fostering the role of entrepreneurship within the EU.

At EU level, EIF manages a total of 14 JEREMIE Holding Funds, of which 7 at national level and 7 at regional level.

In Slovakia, the JEREMIE Holding Fund is financed from the European Regional Development Fund within the framework of the Operational Programmes “Competitiveness and Economic Growth”, “Research & Development” and “Bratislava Region”, which together have contributed EUR 100m.

About EIF

The European Investment Fund's (EIF) central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance.  EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. EIF’s total net commitments to private equity funds amounted to over EUR 7.9bn at end 2013. With investments in over 435 funds, EIF is a leading player in European venture due to the scale and the scope of its investments, especially in high-tech and early-stage segments. EIF’s guarantees loan portfolio totalled over EUR 5.6bn in over 300 operations at end 2013, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor. More information about EIF is available on www.eif.org.

About Neulogy Ventures

Neulogy Ventures is the first Slovakia-based management company to run fully regulated seed and venture capital funds structured along the highest industry standards, is a member of EVCA, and was founded to fund and develop talented entrepreneurs and help their companies succeed in the global market. More information at www.neulogy.vc

About Limerock Fund Managers

Limerock Fund Managers is a venture of Michal Jablonka and Roman Čmelík as founders of transaction and advisory firm, Limerock Advisory, and Teppo Kettula from the Finnish innovation and technology adviser and investor, Aikagroup. Michal and Roman are experienced transaction and corporate finance advisors and have served in private equity funds and start-ups. Teppo is dedicated to leadership and management of innovations in early stages of development. More information is available on www.limerock.sk and www.aikagroup.com.

For further information, please contact:

EIF: d.yormesor@eif.org
SZRF:  r.vaudrey@eif.org  
Ministry of Finance:  radko.kuruc@mfsr.sk
Neulogy Ventures: info@neulogyventures.com
Limerock Fund Managers: roman.cmelik@limerock.sk