Venture Capital funds invest over EUR 232 mln in startups in 2019

Venture Capital funds invest over EUR 232 mln in startups in 2019 Mateusz Marek/PAP

The president of the Polish Development Fund (PFR), Pawel Borys, has told PAP that Venture Capital (VC) funds have increased their investment in Polish startups four-fold in the last two years to over PLN 1 billion (EUR 232 million) this year.

The PFR president said the rapidly increasing investments in technological projects is in large part due to PFR Ventures creating 29 funds investing in young, innovative companies. He noted that data from the third quarter of this year show that those funds have invested around PLN 1 billion in startups. Until now, investments of that type have stood at around PLN 250 million (EUR 58.17 million).

"Taking into account that the available capital is currently over PLN 2 billion (EUR 465 million), the market for financing young, innovative firms by so-called venture capital should achieve a record next year," Borys said. "Poland is becoming a noticed site on the world startup map."

According to a report by PFR Ventures, in the third quarter of 2019, 29 funds were active on the Polish VC market, of which 46 percent were teams supported by public capital and 65 percent were of an international nature. The report also noted that it is important for the interests of the Polish economy for those native VC funds to develop dynamically, creating a professional ecosystem of teams supporting the development of companies, in order, on the one hand "to become capital support for our companies" and on the other, "to share their experiences and to support in international expansion as many startups have neither the resources nor the competence."

Borys said it is not easy to encourage local private investors to invest on the VC market. There is a lack of institutional investors such as pension funds or insurance companies. Hence, PFR Ventures is the main investor of funds with a share of between 25 and 80 percent of the financing in order to mobilise private capital