38% 11% 8% 8% 5% 4% 4%
21%
Construction
Other
Manufacture of transport equipment
Manufacture of basic metals Wood processing
Information and communication
Electronics manufacturing
Figure 15. The volume of regular services (KredEx direct loans and loans guaranteed by KredEx) issued to enterprises in 2020, by sector
Professional education, research, and technical practice
3.3.5. Venture and private capital At the beginning of 2013, the Baltic Innovation Fund 1 (BIF 1), created in cooperation between the three Baltic Republics and the European Investment Fund (EIF), started its operations. This fund of funds places money in private equity and venture capital funds that invest in companies, which are managed by fund management companies from the private sector. The goal of BIF 1 is to offer new financing opportunities to Baltic enterprises with good growth potential, and develop the capital market of the Baltic States. The fund of funds BIF 1 is managed by the EIF. The volume of BIF 1 is EUR 130 million. The contribution of each country through KredEx (Estonia), ALTUM (Latvia), and INVEGA (Lithuania) is EUR 26 million, and the EIF contributes EUR 52 million. At least the same amount of capital is added to the BIF 1 contribution at the level of the funds by private investors.
As at the end of 2020, a total of EUR 298 million has been invested under BIF 1 into 61 enterprises, 31 of which are Estonian enterprises. In the coming years, another EUR 233 million will be invested in regional companies with the support of BIF 1. Baltic Innovation Fund 2 was established in the middle of 2019; its operating principles are similar to those of BIF 1. The volume of the fund of funds is EUR 156 million; the contribution of each country through KredEx (Estonia), ALTUM (Latvia), and INVEGA (Lithuania) is EUR 26 million, and the EIF contributes EUR 78 million.
BIF 1 has invested in seven funds:
As at 2020, BIF 2 investments in funds were as follows: BaltCap Private Equity Fund III (volume of the fund EUR 146.7 million, incl. BIF 2 holding which is EUR 25 million).
• BaltCap Private Equity Fund II (volume of the fund EUR 81.5 million, incl. BIF 1 holding which is EUR 20 million),
From BIF 2, it is planned to finance six to eight venture and private capital funds that invest in enterprises in the coming years. As at the end of 2020, two enterprises had been invested in from BIF 2.
• BPM Mezzanine Fund (EUR 70 million and EUR 15 million, respectively), • Livonia Partners Fund (EUR 73.5 million and EUR 20 million, respectively), • Karma Ventures Fund I (EUR 70 million and EUR 25 million, respectively), • BaltCap Growth Fund (EUR 40.8 million and EUR 20 million, respectively), • INVL Baltic Sea Growth Fund (EUR 164.7 million and EUR 10 million, respectively),
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• Change Ventures Fund II (EUR 31.4 million and EUR 10 million, respectively).
Foundation KredEx
In 2016, KredEx, the EIF and the Ministry of Economic Affairs and Communications signed a funding contract, creating the fund of funds EstFund. EUR 48 million was designated as its volume, to which the EIF will add EUR 12 million. EstFund invested in three funds, which finance, above all, Estonian companies with large growth potential. These three funds are the following: • United Angels Co-investment Fund I (fund volume EUR 15.85 million, to which at least EUR 15.85 million will be added from private investors at the company level in the form of