News and Analysis

The Fund of Funds signs an agreement enabling the access of high-tech companies to support from BGN 1.5 to BGN 7 Million

The total budget of BGN 67 million will be managed by Morningside Hill

29.05.2019

Today, 29 May 2019, the Fund of Funds (FoF) signed an agreement with the financial intermediary selected to manage the Venture Capital Fund under Operational Programme Innovation and Competitiveness 2014-2020 (OPIC), co-financed by the EU Structural and Investment Funds (ESIF).

Morningside Hill OOD and its team comprising Pavel Velkov, Delyan Ganev, Todor Mutafchiyski and Ekaterina Velkova will manage an investment budget of BGN 67 million, including BGN 47.1 million in public financing, the remainder comprising private co-financing.

The team has more than ten years of experience in the management of instruments across the entire investment range such as equity investment, publicly traded securities, Treasury and corporate bonds, derivatives and investments in financially distressed companies. The key professionals at the VCF have gained their experience in Europe, the USA and Africa and are well versed in lending, deal structuring on local and international markets and the management of businesses on an expansion trajectory. They also have international experience in direct investment and fundraising for investment funds.

The investment sectors envisaged by Morningside Hill OOD include the manufacturing of goods integrating new technologies and allowing cost savings per unit; the high-tech industry, software and hardware; e-commerce; products and services marketed in other countries but not yet available in the region, etc.

VCM’s most distinguishing feature is the significant amount of the investments to be made in each supported company, ranging from BGN 1.5 up to BGN 7 million. The purpose of the instrument is to strengthen high-tech companies with a distinct risk profile that need financing in order to be able to establish a market presence and grow their business. The fund manager will also provide assistance facilitating their access to new markets and know-how through better corporate management and overall capacity enhancement.

At the signing ceremony, Alexander Georgiev, FoF Executive Director and Deputy Chair of the Managing Board, having shared his appreciation of the work done to date, said the following: ‘On the heels of establishing several funds providing support to start-ups and companies at an early stage of development, we now present a project financing instrument to businesses that is relatively novel in Bulgaria. We are working hard to ensure that funding, know-how and opportunities to create a favourable business environment are in place so that each step takes us closer to leading equity investment economies’.

The Fund Manager is expected to commence operations in the summer of 2019.