The Estonian Development Fund is a public law entity founded by the Estonian Parliament on the basis of an Act of 2006 the objective of which is to initiate and support changes in the Estonian economy and society to help updating the economic structure, ensuring the export growth, and creating new jobs requiring a high qualification. For that purpose, the Development Fund performs risk capital investments into the starting and growth-oriented technology companies together with the private sector and carries out socio-economic and technology foresight.
Within the framework of foresight, technology and field-specific development trends in the world are analysed; in their light, long-term developments of the state of Estonia are forecasted, and the decision-makers (incl. entrepreneurs, politicians, and officials) are helped in making relevant management-related decisions. The ambition of the Development Fund is, on one hand, to develop Estonia into a regional centre of investment banking and, on the other hand, as an organisation to be the centre of discussion handling the development of the Estonian economy.
2. Estonian dilemmas
Comfortable stability versus changing challenges National versus international Bystander versus initiator Fast growth versus resilience
2012 Estonia recognises and utilises its opportunities for a breakthrough in the globalised and changing world.
The Development Fund helps create the future for Estonia through analysing our possibilities, initiating positive changes and developing the venture capital market.
5. Our challenges
Small but important
Young but experienced
Focused but everywhere
State diligence but flexible
6. Critical success factors
7. Our values:
Ready for change
The Development Fund creates a future for Estonia by analysing our possibilities, including: searching for possibilities to modernise the Estonian economy; setting future objectives for Estonian economic development; informing the decision makers about changes affecting Estonia's future.
The Development Fund creates a future for Estoniaby initiating positive changes, including developing discussions, mediating cooperation and decision processes; leading innovation to areas and policies untouched so far; developing a foresight culture.
Foresight activities are divided into two directions which can, but do not have to relate to each other:
• Foresight main activities (large studies and analysis);
• Foresight supporting activities (short analyses, translations, communication, various “soft” activities, etc.).
Foresight activities are based on three time horizons: 3-5 years: including ways for restructuring existing industries; 5-10 years: a plan for Estonian economic growth possibilities in the medium-term; 15+ years: long-term development possibilities for the Estonian economy and society.
The Development Fund creates a future for Estonia by developing the venture capital market and eliminating corresponding market failures, including:
• investing in start-up companies;
• raising awareness in the field of venture capital – developing a culture of venture capital;
• activating people in the venture capital market and inviting them for cooperation.
The Law gives the Development Fund a possibility to invest: at least 2/3 of investment capital directly in an enterprise; up to 1/3 of investment capital through sub-funds. The Development Fund usually invests in projects which investment need is up to 70 million EEK.
The Development Fund makes investments together with private investors and on equal terms. The Development fund is a value adding investor; that is, in addition to capital it offers experience, knowledge and contacts from international markets and support in management. The Development Fund does not deliver irretrievable aid, i.e. grants.