PFR Ventures announces a call for enrollment in PFR Biznest FIZ, Poland's first Fund of Funds, which aims at supporting the investment activity of Business Angels who invest in innovative companies at an early stage of development. Managing entities and Business Angels can already learn the enrollment rules. Applications can be submitted from 4 to 19 September 2017. The Fund is another financial instrument dedicated to young innovative entrepreneurs, implemented as part of the Strategy for Responsible Development.
The PFR Biznest FIZ Fund is part of a VC Fund platform, the largest in Central and Eastern Europe, developed by PFR Ventures. Its assets amount to over PLN 2.2 billion, and including private funds, this sum is more than PLN 3.7 billion. The Fund will have PLN 258 million at its disposal.
“By launching the PFR Biznest, The Polish Development Fund builds a complete market of financing for entrepreneurs. Its structure was developed as a result of open market consultations in which approximately 300 persons participated, and a comparative analysis of the best programs of this type in the EU. We see great potential to activate the so-called Business Angels in Poland. These types of investors provide huge value to young innovative companies, as apart from capital, they share their unique experience or business contacts," said Paweł Borys, the President of The Polish Development Fund.
The launch of PFR Biznest FIZ is an important element of the so-called Morawiecki Plan as part of the Start in Poland program. In mature markets, Business Angels are the dominant group of investors at the early stage of enterprise development - even up to 70% of the total investment value. In Poland, the Business Angels market is just being created and their share in financing startups is several times lower. The launch of PFR Biznest FIZ will contribute to the increase of investment activity of Business Angels.
“Business Angels play an important role in the innovation financing ecosystem, as they fill the gap between the funds obtained from family and friends, and the funding from venture capital funds, therefore we want to support and popularize their activities. Thanks to their experience, competences and contacts, Business Angels provide companies with so-called smart money, significantly increasing the chances of their commercial success. Over the next several years, we want to increase the number of active Business Angels in Poland several times and the amount of financing they provide," said Maciej Ćwikiewicz, the Vice-President of PFR Ventures.
Under PFR Biznest FIZ, co-investment funds will be established with capitalization from PLN 5 to 30 million, cooperating with Business Angels. Investments in companies will be made in a ratio of 50:50. Half of the funds will come from co-investment funds created by PFR Biznest FIZ and selected Business Angels or by managing entities. The other half will come from the private funds of Business Angels. Similar funds operate in the West on a large scale and are managed, among others, by the European Investment Fund.
"Cooperation with co-investment funds will help Business Angels increase the scale of investments and cooperate in such activities as due diligence or supervision of investments. Group investment will allow for spreading the risk to more entities and increasing the efficiency of acquiring and exchanging expert knowledge, raising the quality of business decisions and, hence, the company's chances for success. Co-investment funds will help to match experienced Business Angels to a particular investment, and will also support them in search, pre-selection and analysis of projects. What is more, Business Angels can rely on assistance in concluding transactions, management and then, depending on the involvement, preferential distribution of profit from investment," said Marcin Nowak, the Investment Manager at PFR Ventures responsible for PFR Biznest FIZ.
Young innovative companies will be provided with access to financing in the form of a capital investment (e.g. taking up shares/stocks) or quasi-equity (e.g. a loan convertible to shares) in the amount of approx. PLN 500 million. Investments in individual companies will amount to PLN 4 million.
Financial intermediaries can now learn the PFR Biznest FIZ conditions published on the PFR Ventures website. Information meetings will be held on 21 and 29 August 2017 in Warsaw. More information can be obtained at the hotline at 800 800 120 or via the online contact form available on the PFR Ventures website.