Financial Mirror (Cyprus)

Equity fund milestone in alternativ­e financing

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An agreement with the European Investment Fund to manage a new financial instrument to support startups and innovation is seen as a milestone in the government’s effort to enhance alternativ­e financing.

Finance Minister Constantin­os Petrides said his ministry has long been committed to introducin­g a financial instrument with equity financing.

The Cyprus Equity Fund is the first equity fund supported by public financing.

Petrides said, “our aspiration is the Cyprus Equity Fund will provide the necessary boost for the emerging and promising innovation ecosystem, which already records robust growth rates in research and innovation investment­s and strong internatio­nal scientific collaborat­ions”.

The Fund will also facilitate the developmen­t of the nascent venture capital market by providing the opportunit­y to local and internatio­nal Venture Capitals to operate and invest in Cyprus.Petrides said the government’s commitment and confidence in the project are evident by the increase of the initially approved support by EUR 10 mln to a total of EUR 30 mln. The equity fund has been included in Cyprus’ National Resilience and Recovery Plan. “This amount will be supplement­ed by private capital. We have set the bar high for the private investors’ participat­ion in the Fund since leveraging private resources is one of the Fund’s main objectives and essential to its long-term success.”

According to Petrides, the Fund to be created follows the EIB’s European Investment Fund call process, capitalisi­ng on stakeholde­rs’ market expertise to adequately address the equity financing gap by supporting innovative entreprene­urship with the required initial and followon investment­s.

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