In a move aimed at strengthening the support for startups and growing businesses in Portugal, Banco Português de Fomento (BPF), the managing entity of the Capitalization and Resilience Fund (FdCR), has announced an additional €35 million investment in two of its venture capital funds. These funds, managed by Indico Capital Partners and Oxy Capital, have shown strong performance, surpassing key financial milestones set by BPF under the national Recovery and Resilience Plan (RRP).

This capital injection comes as a result of exceeding the first phase execution targets, prompting BPF to increase the allocation in both the Indico VC Fund II and the Juno Fund. The move is expected to further bolster financial resources available to innovative startups and companies on the rise, with the goal of fostering entrepreneurship and supporting projects with significant growth potential.

Expanding Investments Amid Strong Performance

BPF’s decision to raise the capital allocated to Indico VC Fund II and the Juno Fund reflects the positive track record both funds have demonstrated in their investment activities. As a result of achieving key milestones earlier than anticipated, BPF has approved an increase in FdCR's total participation in these funds from €65 million to €100 million.

The capital boost will see the Indico VC Fund II's capital rise from €35 million to €50 million, while the Juno Fund, managed by Oxy Capital, will grow from €30 million to €50 million. The allocation is part of the Venture Capital Program, which was launched within the scope of Portugal’s RRP to provide essential financial backing to early-stage companies and accelerate their growth.

The criteria for the capital increase were outlined in the Subscription Agreements signed with the funds’ managing entities. These agreements stipulate that, for additional capital to be deployed, effective investments in final beneficiaries must meet specific targets. By June 30, 2024, the funds needed to have invested at least 30% of the initially subscribed amount, a target both funds have surpassed. By March 31, 2025, the goal is to reach an effective investment rate of 60%.

Strategic Support for Innovation-Driven Companies

Both funds receiving the additional capital infusion play pivotal roles in supporting innovation-driven companies at different stages of development.

The Indico VC Fund II is focused on backing early-stage technology startups, promoting innovation in high-potential markets. To date, this fund has executed investment operations amounting to €14.8 million, with €8.6 million coming from FdCR. Among the companies that have benefited from these investments are tech firms such as Rows, Oscar, FRVR, and Indie Campers, which represent a diverse range of industries and innovation areas.

Similarly, the Juno Fund, managed by Oxy Capital, targets companies primarily involved in research and development (R&D). With €20.6 million in investments completed to date, of which €8.8 million came from FdCR, the fund supports firms like Crossing Answers, Sword Health, Mota-Engil Renewing, Mota-Engil Renewing Energy, and BLOQSTRX, all of which are making strides in sectors such as health technology, renewable energy, and industrial innovation.

Driving Economic Resilience Through the Venture Capital Program

The increased investment in these funds is part of the larger Venture Capital Program, a key component of Portugal’s Recovery and Resilience Plan. With an overall allocation of €400 million, the program aims to subscribe to venture capital funds that support companies across various stages of their development—from pre-seed and seed funding to later-stage ventures, including Series A, B, and C rounds, as well as scale-up phases.

Although relatively new, the Venture Capital Program has already contracted 12 venture capital funds, seven of which have begun making investments in innovative companies. To date, the program has enabled a combined public and private investment of €51.8 million across 21 companies. These businesses span various sectors, including ICT, ecommerce, engineering, finance, cleantech, consulting, tourism, biotechnology, and motorcycle manufacturing.

These companies are distributed across several regions in Portugal, with hubs in Porto, Lisbon, Braga, Viseu, Guimarães, and Santo Tirso. This regional diversity underscores the program's role in driving economic resilience and fostering innovation throughout the country, rather than concentrating investment solely in Portugal’s major cities.

A Boost for Startups and Economic Growth

By approving this additional €35 million in capital, BPF continues to advance its mission of supporting Portugal’s economic recovery and growth through targeted investments in high-potential companies. The fund’s focus on technology, innovation, and sustainability aligns with broader European Union objectives to create a more resilient economy post-pandemic.

The Venture Capital Program’s expansion represents a significant opportunity for startups in Portugal to access the capital they need to scale their operations, enter new markets, and drive technological progress. As more funds are directed toward high-growth sectors, the program’s impact is expected to extend beyond the immediate beneficiaries, contributing to the overall dynamism of Portugal’s entrepreneurial ecosystem.

With the recent €35 million capital increase, BPF’s Venture Capital Program is positioning itself as a catalyst for economic development in Portugal, providing essential financial support to companies at crucial stages of their growth. This strategic investment is not only a vote of confidence in the funds managed by Indico Capital Partners and Oxy Capital but also a reflection of BPF's commitment to building a stronger, more resilient economy through innovation-driven companies.

As the program progresses, the expectation is that these investments will help create lasting value for the Portuguese economy, fostering an environment where startups and growing businesses can thrive, scale, and contribute to the country's long-term economic recovery and resilience.