Czech Private Equity and Venture Capital Association

Private equity and venture capital (PE/VC) are alternative sources of funding for innovative projects and companies with potential for rapid growth. The term private equity refers to medium- to long-term financing provided in exchange for acquiring a stake in the owners’ equity of enterprises whose shares are not traded on any stock exchange. Funds are invested into companies that have potential for creating value and increasing their market share and whose business plan aims to produce and offer a highly innovative product, process or technology.

If we explore the definitions of private equity and venture capital more closely, we can agree on the following explanation. Both cases concern investment in a non-publicly traded company for which the investor acquires a share in the company’s owners’ equity. The term private equity is the name for the whole group of such investments. Private equity itself comprises both purchases of companies by company management (buyouts) or by external managements (buy-in) as well as venture capital, i.e. the capital invested in a company’s seed, start-up and later growth stages.

In the Czech environment, venture capital is understood as medium- to long-term capital invested in the form of an equity stake in a company. The venture capital fund acquires a share in the company’s registered capital in exchange for the investment, and, in addition to funding, it also provides the firm with professional assistance (the principle of “smart money”). Most often, this assistance takes the form of financial and strategic support in developing the company. It varies for individual investments, however, depending upon what form the investor and enterprise agree. It may involve actively strengthening the team in the top management positions or a passive role as advisor in the financial area. The investor often enhances the company through its beneficial contacts in various business areas and in acquiring new customers.

 


News

  • Wednesday, 22. March, 2017

    EIF INVITES TEAMS TO MANAGE FUNDS OF UP TO EUR 50 MILLION FOR INVESTMENTS IN CZECH STARTUPS AND DEVELOPING COMPANIES

    In its position as a European market leader in equity investments, EIF opened a call for expressions of interest by managers of risk capital funds to manage accelerators, seed funds and VC funds, using resources from the national OP Enterprise and Innovations for Competitiveness, financed from the European Regional Development Fund. Selected managers will receive funding from the Czech ESIF Fund of Funds as well as an investment from EIF – EUR 50 million.  

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  • Wednesday, 15. March, 2017

    Genesis Fund enters a new industry, acquiring a stake in POS Media Group

    Genesis Private Equity Fund III (GPEF III), which was launched last year, announces its latest investment. The Fund acquires a 47% share in POS Media Group, a provider of point-of-sale advertising and in-store communications solutions. The main partners of the Group include leading retail chains in several countries across Central and Eastern Europe. Following the acquisition of a majority stake in the pharmaceutical company QUINTA-ANALYTICA, POS Media Group represents the second investment of GPEF III, which has a total of over EUR 80 million in committed capital for investments into small and medium-sized enterprises in the Czech Republic, Slovakia, Poland, Hungary and Austria.

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  • Tuesday, 28. February, 2017

    ARX Equity Partners Acquires Czech Baby Food Producer

    ARX Equity Partners (“ARX”) together with experienced food industry entrepreneur Keith Dilworth completed the acquisition of Nutricia Deva a.s. (“Deva”) from Danone Group.

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