The MIF, CAF and EMPRENDE sign agreement to help finance Dominican entrepreneurs
July 24, 2012, SANTO DOMINGO, Dominican Republic – The Multilateral Investment Fund (MIF), a member of the Inter-American Development Bank Group (IDB), the Development Bank of Latin America (CAF), and tech-based business incubator Emprende signed an agreement in the amount of $1.2 million for the establishment of the first Seed Capital Fund for the support of entrepreneurs in the Dominican Republic.
The purpose of the fund is to provide entrepreneurs who have projects in early stages of development with access to capital, which is essential to the success of their ventures. It is projected that the fund will be replenished in the future by the Dominican public and private sectors, and other multilateral lending institutions. The MIF and CAF have committed $900,000, with $300,000 supplied by EMPRENDE.
The initiative is accompanied by technical assistance resources provided by the MIF to Emprende for the incubation of business opportunities, which can then be showcased to members of Enlaces, a network of angel investors. Once angel investors allocate capital in early-stage development ventures, entrepreneurs can access assessment instruments to allow their business projects to be considered for funding.
The fund will serve as a co-financing mechanism, allowing entrepreneurs to raise resources from the private sector through Enlaces and access up to $150,000 of seed capital to support their initiatives.
Enlaces, created in 2008 as the result of a MIF technical assistance program, is the largest network of angel investors in the Dominican Republic, with 57 members that have invested around $400,000 in four business ventures. The program also created eight Innovation Centers through the National Entrepreneurship Program of the Ministry for Education, Science and Technology.
The formation of seed capital funds effectively contributes to the development of a culture of risk investment, which is essential for the creation of new businesses and for the support of entrepreneurs and their investors. The MIF plays an integral role in the development of ecosystems that finance entrepreneurship, and, along with the CAF, is an active investor in seed and venture capital funds in Latin America and the Caribbean. Recent experiences include programs in Chile, Uruguay and Argentina, among others.
The signing ceremony, held at the National Palace, was attended by the President of the Republic, Leonel Fernández Reyna; Eddy Martínez, the President of the Board of Directors of EMPRENDE and Director of the Center for Trade and Investment; MIF representatives Tomás Miller and Smeldy Ramírez, and CAF representative Rodolfo Clavier. Also in attendance were the Minister of Higher Education, Science and Technology, Ligia Amado Melo de Cardona, and Orlando Pérez Richiez, Executive Director of EMPRENDE and Director of the aforementioned Ministry’s National Entrepreneurship Program. Guillermo David Mendez attended on behalf of BHD International Bank-Panama, accompanied by BHD Financial Center President Luis Molina, and the Chairman of Enlaces’ Board of Directors, Marcos Troncoso.