Mehmet Şimşek's 'fund of funds' announcement: Support for entrepreneurs!

Treasury and Finance Minister Mehmet Şimşek had given instructions in 2018, during his time as Deputy Prime Minister, to establish a fund of funds to provide support to entrepreneurs in Turkey. Efforts regarding the fund's activation have been accelerated following Şimşek's return to office in the new term.

Minister Şimşek pointed out that venture capital is an alternative financing tool for early-stage and growth-stage firms with high growth potential in both developed and developing economies.

Stating that as a Ministry, they have been working on new financing methods since 2014 to support the entrepreneurship ecosystem and increase the capacity and effectiveness of venture capital funds, Şimşek said, "In this context, the Turkey Growth and Innovation Fund was established in 2015 for the first time in our country through our Ministry's initiative in cooperation with the European Investment Fund, and our Ministry became an investor by committing 60 million euros to this 200 million euro fund."

Şimşek also recalled that in 2018, a cooperation agreement was signed between TÜBİTAK and the Ministry regarding the implementation of the Tech-InvesTR Program, and direct resource transfers to venture capital funds began.

TO BE MANAGED TRANSPARENTLY

Providing information on the final stage reached in these efforts, Şimşek made the following assessment:

"With the contribution and support of our Ministry, the work carried out with the Development and Investment Bank of Turkey to create a new fund of funds within the Turkey Development Fund has reached the final stage. With this fund of funds to be established, resources will be provided to venture capital funds that will invest in companies operating in strategic sectors and technology fields. The aim is to support venture capital funds that will invest in sectors prioritized in policy documents such as development plans and the Medium-Term Program. While the fund size is projected to be 50 million dollars in the first phase, this amount may increase if national and international investors also participate in the fund of funds."

Minister Şimşek drew attention to the fact that the fund to be established will be managed in a transparent manner in accordance with international norms, and said that annual audits will be carried out for the fund of funds through an independent audit firm. Şimşek also explained that it would be possible for the Ministry to conduct audits if needed.

"WILL CREATE A LEVERAGE EFFECT"

Pointing to the gains targeted with the activation of the fund, Şimşek noted the following:

"The resource transfer to be made is aimed at allowing for the indirect support of businesses producing high value-added goods and services and the dissemination of an entrepreneurial culture, providing support for the momentum needed by the venture capital ecosystem by creating a leverage effect, and contributing to our country's technological development and value-added growth strategy."

News Source: 12punto