At today’s regular meeting, the government approved changes to the budget of the Ministry of Finance for 2020 to increase the capital of the Fund of Funds with a cash contribution of BGN 375,000. The increase of the capital of the company will be carried out by issuing new registered shares with a nominal value of BGN 1 each.
The funds from the increase will ensure the activity of the Fund during the year, according to the Memorandum of Understanding between Bulgaria and the European Investment Bank from 2016.
On Tuesday The Fund of Funds (FoF) has signed an agreement with the selected financial intermediary for the implementation of the Seed/Acceleration and Start-up Fund II to be financed under Operational Programme Innovation and Competitiveness 2014-2020 (OPIC), co-financed by the European Structural and Investment Funds.
The funds will be managed by Vitosha Venture Partners OOD, led by the managing partners Maxim Gurwitz, Maris Pree, Nikola Stoyanov, Paul Weinberger, Marin Iliev and Eric Anderson. The Sofia-based management team will be responsible for the disbursement of BGN 38 million, including BGN 35.6 million in public financing made available by the Fund and Funds to be supplemented by private co-financing.
The team of the selected financial intermediary has gained relevant experience in investment management and entrepreneurial programmes and ecosystems over the course of more than ten years. The key team members have been previously part of the teams of several fund managers in different countries, having had responsibility for the management and investment of funds in more than 200 technological start-ups in Europe and the United States.
Along with equity and quasi-equity investment, Vitosha Venture Partners will provide mentoring and strategic support to the companies and use the team’s dedicated international business development networks to raise additional private equity. Approximately half of the companies eligible for support will participate in an accelerator programme arranged by the Fund Manager, and the remainder of the investment will be in companies at a more advanced development stage.
The intermediary is expected to make the first investments in the market in the summer of 2020.
By signing of the agreement with Vitosha Venture Partners, the Fund of Funds will complete the architecture of the seed/accelerator and start-ups network put in place, which will give a significant boost to the efforts to create competitive channels for the development of innovative companies in Bulgaria in the coming years. Other funds that invest as part of the network are Mew Vision 3 and Innovation Accelerator Bulgaria, which has recently changed its name to Innovation Capital.
Together with Morningside Hill (the Venture Capital Fund), these bring up the number of funds actively engaged in equity and quasi-equity financing to a total of four. They will support approximately 400 small and medium-sized enterprises with a total of BGN 190 million, including BGN 148 million in public financing and BGN 42 million in private financing raised by the intermediaries.