At the start of the 2000s, the venture capital industry, although established in the US, was only just getting going in the EU. The New Economy Development Fund (TANEO) was incorporated 18 years ago to help kick-start the venture capital (VC) market in Greece and to promote innovation. Innovation been central to TANEO’s vision ever since.
By design, TANEO is a fund-of-funds that leverages an equal number of private investors’ money by jointly investing in newly discovered venture capital funds on a pari-passu basis. By will and culture, it is an institution that promotes the continuous development of the VC market and that diffuses its values and mentality to the market participants. TANEO has always set, and still is setting the high standards that the VC market follows.
During the past 18 years, TANEO has had many landmark moments. It managed to raise its entire initial capital from the international markets, with the use of the Greek State guarantee, and then succeeded in effectively directing it to the local VC market. This task was performed during two small windows of opportunity, both of which encountered their own adverse environments. The first window demonstrated all the difficulties of a new venture, whereby TANEO had to introduce the actual concept to the Greek financial markets, the second took place amidst the Lehman Brothers meltdown.
TANEO has also been used as a case study in international literature. During its lifetime, TANEO dedicated the means and media to establish, support and hold the annual Greek VC Forum as well as the continuous Union of the VC funds. Both have since become recognised as the ultimate reference point for discussing legislation and as meeting places for exchanging ideas and promoting the industry. These achievements are a result of the individual, as well as collective, contribution of the professionals that have comprised the TANEO team over the years.
As an institution TANEO cannot be valued solely by numbers, it is therefore impressive to list some of the many achievements: 11 venture capital funds have been established; 50 investees from almost all sectors supported; and 3,000 jobs have been created.
Bearing in mind the challenges that the Greek economy has faced during the majority of this period, it is also worth noting that the divestments so far present remarkable returns, and in several cases have attracted the interest of multinational companies. Having established solid foundations by introducing a competitive regulatory framework and by educating the market participants, TANEO has contributed to all subsequent progress that Greece is experiencing. The Jeremie and the Equifund initiatives build their efforts upon those foundations.
Seldom has an innovation thrived without having to overcome difficulties of macro- or micro- economic nature. Due to its unique financial structure, TANEO had to tackle the negative effects of investing in equity using debt, a fact that creates a maturity mismatch. More importantly, TANEO had to operate in an economy that has been hit by the deepest and longest recession Greece has faced since World War II. But, this is all in the past. TANEO came through the crisis and now finds itself once more at the forefront of the Greek SME financing. A toolbox of much-needed financial instruments has already been designed and developed in close co-operation with TANEO’s parent organisation, the Hellenic Fund for Entrepreneurship and Development (aka ETEAN). The unique positioning of the Group in the economy, combined with its acute market sensors, help it identify any gaps in the market and design the most appropriate instruments to efficiently address them. To this end, ETEAN and TANEO are capable of offering stand-alone, or a mix of the following instruments: guarantees, loan co-financing with competitive interest rates, equity participations in SMEs in need for financial and/or operational redesign, sector-specific equity and guarantee instruments, and debt financing etc.
In 2018, TANEO is launching a FoF in cooperation with the Ministry of Economy and Development in order to support Greek SMEs in need of operational and financial adaptations. In parallel and in coordination with relevant managing authorities, TANEO is introducing innovative schemes to tackle market inefficiencies in specific segments of the Greek economy, such as the agribusiness, digital content etc.
On the international front, TANEO has recently agreed and signed a co-investment model with Mubadala, the investment arm of the United Arab Emirates, for a total of 400m euros, targeting investments in Greek companies. This agreement set in motion a sequence that has attracted additional sovereign funds from various countries, which have expressed their interest in joining forces with the local entities on mutual agreed initiatives.
The total impact of these financing tools is estimated to exceed 3bn euros. The deployment aims at mobilising the Greek banking sector as well as other important financial intermediaries of the Greek market, in a manner that will also benefit the ailing Greek financial system.
In addition to its past, current, and future autonomous projects, TANEO is also set to be an integral part of the establishment of the Hellenic Development Bank. Coupled with its proven track record of designing, establishing and monitoring financial instruments, TANEO’s know-how developed first as a private company with public mandates, and then as a public company with market-driven characteristics, will be invaluable to this ambitious project.
TANEO is delighted to be recognised as the “Best Venture Capital Investment Firm of the Year – Greece 2018” by The European. This award symbolises the pan-European recognition that TANEO enjoys for its accomplishments within the venture capital market, as well as its long-lasting contribution to the Greek economy.