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Entrepreneurism

Time for planting

Finep selects managers for seed capital funds

The Financier of Studies and Projects (Finep) has begun to select managers interested in taking part in the Innovate Seed Program. This new program, launched on the 14th of last December, provides for investments of R$ 300 million in nascent technology-based companies, over five years.  The expectation is to support about 340 innovative enterprises in this period.

Innovate Seed wants to stimulate the creation of 24 seed capital funds – also known as seed money – organized by cities, according to their technological vocation. Each one of these funds should be able to count on an initial capital of R$ 12 million, to support between 12 and 15 companies. In the makeup of Innovate Seed, Finep participates with 40% of the funds, another 40% will be injected by the local bank or development agency, and the remaining 20% will come from private investors.

“We want to bring private individual investors to the business”, explains Eduardo Costa, the superintendent of Finep’s small innovative businesses area. These investors, also known as “angels”, besides investing their own resources in the new enterprise, will offer their experience and competence for the development of the business, helping with the formation of teams and in setting up a relationship network.

The first step for setting up these funds is to contract a manager, who, according to the notice available on the Finep website, should have experience in the whole cycle of the industry – prospecting, investing, accompanying and disinvesting -, knowledge in the management of venture capital funds, and enjoy the support of a financial agent. “This agent can be the local Sebrae (agency responsible for assistance to small businesses), the Federation of Industries, amongst others”, exemplifies Luiz Antonio Coelho, Finep’s manager for Projects and Programs. The proposals must be presented by July 30 (further information on the www.finep.gov.br).

The proposals selected will be evaluated by Finep according to such criteria as the impact of the setting up of the fund on local development, the qualification and previous experiences of the team, the cost structure, and the quality of the pipeline, amongst others. Before the final approval of the proposals, there is provision for technical visits (due diligence) being carried out to evaluate the operating conditions of the fund and to verify the information presented. The first results will be shown in blocs of five approved proposals.

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