The first 18 startups financed by the ALTUM accelerator programs graduate Most promising teams will qualify for 250 thousand euro investment
Three accelerator funds backed by the Development Finance Institution ALTUM, started in autumn, have successfully completed their first startup batches. The accelerators, Overkill Ventures, Buildit Latvia and Commercialization Reactor Fund, provided acceleration services to the 18 most promising local and international startups selected from over 600 applications.
Startups that enrolled in accelerator funds represent industries such as internet of things, smart living, health tech, smart mobility, and others. In total, about 700,000 euros will be invested in the development of these companies and teams throughout the acceleration phase as a pre-seed investment for business launch, consulting and product development, research, evaluation, and validation. In three to six-month long accelerating phase, startups were focused on developing the idea, and with the help of mentors and industry experts learned how to attract buyers, suppliers, partners, and investors. The most promising new companies will have the opportunity to qualify for the next phase of investment, which is another 250,000 euros of seed investment. Such investments are intended for further growth of the company, development of product and economic model.
All startups that have received funding, according to the program conditions, are registered in Latvia.
To celebrate the successful first phase of the accelerator program, ALTUM in TechChill 2019 week will host an event called ALTUM-backed accelerator funds – Up & Running, where accelerators, startups, and ecosystem representatives will reflect on the work and evaluate team development. One of the panel discussions will be about the accelerators in Latvia, the principles and challenges of their operation. Also, the representatives of the startup ecosystem will talk about Latvia as a great place for business establishment and new innovations. In the evening, experienced investors will share their insights into the private investment world.
Currently, Overkill Ventures, Buildit Latvia and Commercialization Reactor Fund have begun their next admission. The second phase of the program is scheduled to start at the beginning of the second quarter of this year, and it is planned to provide acceleration services for up to 30 startups at this stage. Such admissions will continue until 2021: each fund manager will announce five admissions with a total of 150 companies and startup teams.
Juris Vaskans, Member of the Board of ALTUM:
“The admission of ALTUM-funded accelerator funds is characterized by a high level of business interest and fierce competition beyond the initial expectations. At the same time, it also showed the weaknesses of many bidders that need to be improved to qualify for one of the next admissions. Here we should mention both the lack of business growth potential and the capacity of team skills. But already in the first stage of the development of startups, truly promising companies and bright minds for the next stage of investment have been noticed. We are pleased that Latvia, with the support of ERDF funding, is becoming a part of global venture capital in the field of global acceleration funds, where both Latvian accelerators and every Latvian and international startup compete on equal terms and without geographical boundaries.”
Accelerator funds that were chosen by the Development Finance Institution ALTUM in public selection, have received 15 million euros from the European Regional Development Fund and public funding to be invested in companies and startups by 2021. In addition, fund managers have attracted a further 1.35 million euros from private investors, increasing their support to 16.35 million euros. Currently, it is the largest venture capital for early-stage business projects that have ever been available in Latvia.
From more than 600 applications that were submitted to participate in accelerator programs, 40% were Latvian representatives or mixed teams, 40% from Central and Eastern Europe, and 20% from Western Europe, USA, and other countries. Fund managers choose the most competitive and potentially successful business projects with the most motivated teams. Commercialization Reactor specializes in the commercialization of science or deep-tech. Buildit Latvia is geared towards hardware and internet-of-things, but Overkill Ventures works with the direction of work environment and business efficiency enhancement software.
The essence of Accelerator Funds is to help kick off innovative and promising early-stage businesses that are designed not only to profit but also to help address local and global challenges. The new funds are focused on the commercialization phase of companies and startups in the field of innovation and technology. The biggest difference between classic venture capital funds and accelerators is that they not only invest in the business, but also provide training and other benefits for future growth: mentor lectures from around the world, sales and investor contacts, technological support, market segmentation, and other opportunities. Each of the funds also provides pre-seed investments and seed capital investments.