Finnish state launches €1bn start-up fund

Private investors with an appetite for risk are being targeted in a bid to bridge the crisis-induced government funding gap without increasing the country's budget deficit. The aim is to boost economic growth and create jobs.

"Private investors are encouraged to fund start-up companies by offering them a higher return on investment compared to what the state would provide," says Petri Peltonen, the Finnish Economy Ministry's head of enterprise and innovation.

Finnish Industry Investment will invest in venture capital and growth stage funds operating in Finland. The focus of these investments will be Finnish SMEs that have international growth potential.

The program mainly targets high-growth companies. Technology start-ups will represent close to half of total investments, according to Peltonen.

Potential investors include institutional investors, VCs, business angels and large corporations. At least half of the capital is collected from private sources.

The long-term venture fund programme is divided into two parts. Tekes (the Finnish Funding Agency for Technology and Innovation) is launching another funding program in 2014, focusing on seed and early-stage investments.

Peltonen told unquote" the programme is a government response to the ongoing restructuring of ICT and other industrial sectors in Finland.

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• Topics
• Nordics
• Fundraising
• Finland