Head of the supervisory board of the Ukrainian Venture Capital and Private Equity Association (UVCA) Andriy Kolodiuk has said that the best way to support startups by the state is the establishment of a fund of funds with the provision of partial financing of the fund from the national budget.
“The draft budget for 2018 announces Hr 50 million for the creation of the fund of startups. Our association had another proposal – that the state should become a co-investor in the fund of funds, which would invest not in startups, but in 25 existing funds,” he told Interfax-Ukraine on the sidelines of the Innovation Market Chinese-Ukrainian exhibition in Kyiv on November 21.
He said that it is hard for Ukrainian startups now to attract investment due to high risks. Kolodiuk said that it was about Hr 260 million from the national budget, which would help attracting half a billion U.S. dollars to domestic startups.
Kolodiuk said that the fund of funds allowed the state to support startups with the rights of a co-investor.
“At a meeting Prime Minister Volodymyr Groysman promised us this and gave the instructions to the Finance Ministry. However, this idea was not reflected in the draft national budget,” Kolodiuk said.
“According to our data for the last year, average investment into a Ukrainian startup reached $500,000. Thus, investments in 1,000 startups would have allowed attracting investment of $500 million,” he said.
