Slovak Investment Holding, CB ESPRI and Social Innovators launch investment funds for social economy
Bratislava, June 1, 2022 - Slovak Investment Holding (SIH) together with the fund trustees CB ESPRI and Social Innovators Impact Capital is launching two investment funds to support the social economy.
Both fund trustees, CB ESPRI and Social Innovators, were successful in a tender process from which SIH selected from a total of five high-quality professional bids. SIH will invest a total of € 20.9 million in both trustees' funds, i.e. CB ESPRI Impact One and the SIIC Fund. Each fund trustee will thus receive € 10.45 million. This is part of the European Social Fund from the Human Resources Operational Programme, which SIH manages in the form of repayable financial instruments. The purpose of using the funds is to support activities or enterprises whose main objective is to achieve a positive social impact.
"The signing of contracts with the fund trustees completes the first period of SIH financial instruments for the social economy in Slovakia. This means that the market has accepted the full range of these instruments that SIH has offered to support social economy activities - from guarantee to credit to equity. Despite the early stage of development of this sector, we are extremely pleased that truly professional intermediaries have been found for each of these instruments. We believe this bodes well for the repayable support programme for social enterprises," says Peter Fröhlich, CEO of SIH.
The fund trustees will support businesses in the wider social economy across Slovakia, with the exception of the Bratislava Self-Governing Region, in the form of equity or quasi-equity investments; investment contracts can be signed until the end of 2023. The fund trustees will be tasked with finding suitable investment projects, negotiating contractual documentation with the target companies, implementing the investments, and ultimately exiting the target companies again within a reasonably long timeframe so that the public funds can be reused.
"Investments in projects with a measurable socially beneficial impact represent a significant driver for a long-term sustainable Slovak economy. They can help address the societal challenges that are already knocking at our door. I am thinking of employment, education, community development and more decent health and social care. In Slovakia, we have a number of initiatives led by smart people with innovative solutions to these challenges. The resources from the investment fund give them the opportunity to implement solutions more quickly and thus improve the quality of life in the regions. I will be happy if these initiatives are transformed into useful and economically sustainable organisations," said Mikuláš Kresánek, Executive Director of Social Innovators Impact Capital.
Miroslav Beblavý, Executive Director of CB ESPRI, stated that they were inspired by similar funds supporting the social economy in developed European countries. "We want to show that successful entrepreneurship and positive social impact can go hand in hand. The advantage for a business is that we can also help in situations where bank financing is unavailable and on more favourable terms than in a purely commercial market. In return, the beneficiary has to show a measurable positive social impact of its activities and support the employment of, for example, elderly people."
Slovak Investment Holding, a. s.
SIH is a 100% state-owned joint stock company. Its main mission is to support strategic public and private investments in Slovakia in the fields of infrastructure, energy efficiency, waste management, the social economy, small and medium-sized enterprises, healthcare and the cultural and creative industries. It draws funds for the implementation of investments from the European Structural and Investment Funds. SIH finances projects exclusively in a repayable form, i.e. through financial instruments and not in the form of a grant. www.sih.sk
CB ESPRI, s. r. o.
CB ESPRI, s.r.o., which will manage the CB ESPRI Impact One Fund, is a joint venture between ESPRI, s.r.o. and Crowdberry, a. s.
ESPRI is a research and consulting firm working primarily in the areas of employment, social welfare, education and public administration. Since its establishment in 2007, it has been involved in several major research projects from the EU's 7th Framework Programme for Research and Development or Horizon 2020. For example, it is currently coordinating a network of European experts on the economics of education for DG EAC. www.cbespri.sk
The Crowdberry investment platform was established in 2015 with the aim to professionalise the investment environment and promote direct local investment in Czech and Slovak companies and real estate. The roughly € 40 million in capital invested so far has helped dozens of innovative companies to grow, including GymBeam, MultiplexDX, Boataround, Ecocapsule and others. Crowdberry also manages several investment funds focusing on startups, real estate or positive social impact investments. www.crowdberry.eu
Social Innovators Impact Capital s. r. o.
Fund trustees Social Innovators Impact Capital s. r. o. (SIIC) and the SIIC Fund are being formed as an outgrowth of 10 years of Social Innovators Cooperative's pioneering activity in financing projects and organisations with a socially beneficial impact. Social Innovators aims to set up a functional and efficient infrastructure and ecosystem for social challenge solvers to bring about systemic change in society. They help them set up a business model, funding structure and provide financial resources to implement and scale solutions. All with a clear goal in mind - that responsible businesses that solve societal challenges are not only sustainable, but also growing, innovating and setting the direction for the rest of the economy. Through the newly launched SIIC Investment Fund, they want to invest in organisations with a positive social impact in education, health and social care, community development and regional employment support.
Through its activities, Social Innovators has so far implemented more than 15 projects in the field of social economy, including Nová Cvernovka, Bivio, WASCO, National Water Polo Centre, Bakery Kruh, Green Bicycle for a total of more than € 5 million. www.socialniinovatori.sk/investment