In an unprecedented activity, the development and financial institution ALTUM has annouced that they are taking applications for managers of the acceleration fun, estimated at 15 million euro.
The development finance institution ALTUM has announced procurement for selecting accelerator fund managers. ERDF financing of EUR 15 million will be made available to accelerators, a novelty in Latvia meant to support companies in the very early stages of development.Fund managers are invited to submit their applications by April 10.
During the procurement, three accelerator fund managers will be selected – financial intermediaries providing accelerator services to new business ideas, including through mentoring and consultation, pre-seed and seed capital investments.
ALTUM will allocate EUR 5 million to each accelerator, which will make up 90% of the total amount of funds of the accelerator, while fund managers will have to contribute the remaining 10%.
The accelerators will focus on new ideas in their commercialization stage, when the idea of a product is clear, a prototype may have been created but it needs to be tested, upgraded, have target markets found and business concepts developed for it. The accelerator program will cover accelerator services (free and fee-based) and venture capital investments – loans, equity or quasi-equity.
The ALTUM Board Member Juris Vaskans says: “The purpose of accelerators is to help ideas take off that have a high added value potential. The accelerator funds will fill in the missing link – state support when an idea is in the commercialization stage.The new funds will focus specifically on this stage in the development of innovative and technologically-intensive startups. We are planning that around 120 promising ideas will receive accelerator and investment support. The maximum amount of financing available during the pre-seed stage will be up to EUR 50,000, while in the subsequent stages the best ideas will be able to receive seed financing of up to EUR 250,000. The current accelerator model in Latvia has been recognized, both locally and internationally, as one of the most efficient ones. The industry recognizes the need for the support tool, has approved the model selected, and expressed support for its launch. I am therefore hopeful that Latvia could also attract promising ideas from other countries."
Financial intermediaries or fund managers can submit their applications until April 10. Thewinners will be selected based on the following main criteria:
- Experience in venture capital investment and building value
- Accelerator program management plan
- Experience of organizing successful accelerator programs
- Financial offer (equity contribution to the fund and fund management fee)
Accelerator funds could begin their operations in the 3rd quarter this year. ALTUM will make an individual public announcement to organize a meeting with contenders interested in the offer and to further explain procurement requirements and answer the questions they may have.