The Government also supports starting businesses by a venture capital programme 3 July 2012
The new invitations for the venture capital programmes are now available. Only venture capital fund managers may apply. The purpose of the government with the constructions launched within the framework of the New Széchenyi Plan is to improve the participation and development potentials of starting and growing enterprises on the market. In relation to the invitations the government appropriated HUF 28.5 billion: HUF 6 billion for the seed funds and HUF 22.5 billion for the growth funds.
The essence of the newly appeared constructions of the New Széchenyi Plan is that venture capital funds should support innovative enterprises requiring long term resources for their successful management by way of investments. Lack of capital hits starting and growing enterprises most as these companies are the least creditworthy. For this reason providing capital type resources for companies by way of state supported applications and encouraging private investors’ participation in the financing are necessary.
A total of HUF 28.5 billion worth budget is available in relation to the two calls for application: HUF 6 billion for the seed (starting) funds and HUF 22.5 billion for the growth funds. Within the framework of the Common Seed Fund Subprogramme 4 investment amounts of HUF 1.5 billion each may be granted. Similarly, within the framework of the Common Growth Fund Subprogramme three times HUF 4.5 billion and three times HUF 3 billion support may be granted. For each fund private investors’ resources of at least 30% are also involved, amounting to a further nearly HUF 12.5 billion meaning that the investments performed by the 10 fund managers may result in minimum HUF 41 billion worth investment by the end of 2015.
The objective and condition system of the Common Growth Subprogramme is very similar to that of the JEREMIE venture capital programme: its primary aim is to support innovative enterprises in their growing phase, however, with already bigger transaction amounts focusing on projects in the more mature phase.
With the Common Seed Fund Subprogramme the Government is targeting beneficiaries having received very limited capital until now. The programme will expressly serve the purpose of seed type capital financing wishing to support projects in very early phases, existing even at concept level only and requiring relatively low initial resources. In line with the features of the seed type projects the maximum investment amount is the HUF equivalent of EUR 150,000 in 12 months, which based on another investment decision may be supplemented by a maximum of further EUR 150,000 worth financing. Fund managers participating in the already running capital programme may also apply for this subprogramme.
Applications may be submitted between 8:00 and 15:00 hours on Monday, 30 July 2012 at the registered office of MV Zrt: Budapest 1074, Dohány utca 12., Floor V (Focus Point Office Building). For invitation related further information please visit the National Development Agency’s website (www.nfu.hu).