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SmartCap

About

SmartCap provides cornerstone investments for private fund managers to create a vital venture capital market in Estonia and enable ambitious and innovative Estonian companies to emerge and grow globally

SmartCap is a small fund manager established in 2011 operating under an activity licence issued by the Estonian Financial Supervision Authority. SmartCap is a subsidiary of Estonian Business and Innovation Agency (after the merger of Foundation KredEx and Enterprise Estonia from January 2022).

SmartCap manages two common closed-end alternative investment funds: SmartCap Venture Capital Fund and SmartCap Green Fund. Both operate as a venture capital fund-of-funds according to their strategy. The sole unitholder of both funds is the Republic of Estonia.

SmartCap’s mission is to drive the development and growth of Estonian venture capital market by being a committed cornerstone investor in venture capital funds, addressing identified market gaps and investing through different economic cycles.

The Management Board of SmartCap has two members: Sille Pettai and Mari Vavulski.

The Supervisory Board has five members: Priit Põldoja (Chairman), Sille Kraam, Aare Järvan, Veiko Hintsov and Mikko-Jussi Suonenlahti.

We work towards sustainable future and are devoted to make a conscious impact on various aspects of our society.

Our core values are integrated and implemented in our business strategy, management and investment processes, day-to-day operations and interactions with our stakeholders and business partners. The core values are:

Strong integrity
  • Being transparent, trustworthy and open partner to our stakeholders, investors, investees and business partners, as well as with the public;
  • Acting in good faith;
  • Engaging only in ethical, honest and fair business practices;
  • Upholding good reputation and public image;
  • Favouring socially responsible partners, investments and business opportunities.
Environmentally-friendly practices
  • Limiting the impacts of climate change;
  • Practicing responsible resource management;
  • Reducing pollution.
Social awareness
  • Being mindful of equality, diversity and inclusion at all levels of the society;
  • Caring for the well-being of our employees, the people around us and the society as a whole;
  • Creating a supportive, safe, fair and dignified workplace.
Good governance
  • Using the best corporate governance, disclosure and reporting practices;
  • Having a transparent ownership and management structure;
  • Applying high standards to internal policies and to the compliance with regulatory requirements;
  • Avoiding conflicts of interest, breaches of confidentiality or any other transgressions;

We are a member of the Estonian Private Equity and Venture Capital Association (EstVCA) and follow its openness and transparency guidelines. SmartCap is also part of Invest Europe network – the world’s largest association of private capital providers that represents Europe’s private equity, venture capital and infrastructure investment firms, as well as their investors.

Investment strategy

  • Why we invest? We aim to be a committed partner for private fund managers to develop Estonian venture capital market and modernise Estonian economy.
  • Where we invest? We invest into both generalist and industry specific venture capital funds with a strong focus towards Estonian innovative early-stage research and technology-intensive enterprises with strong international growth potential.
  • How we invest? We make cornerstone investments into venture capital funds hand-in-hand and on equal terms with private investors.

Steps towards investment

  1. SmartCap publishes a Call for Expressions of Interest. The Call offers investment solutions that are currently not available on the market or focusing on identified market deficiencies. As a cornerstone investor we lower the entry barrier to the venture capital market for private investors.
  2. Private fund manager is selected at the Call to establish a new fund. Fund manager is selected based on their investment proposal, team profile and competences. Our investment decisions are made on market terms and based on market needs.
  3. Newly established fund makes direct investments into underlying companies. The new fund will be making investment decisions independently based on the Call's objective and the fund's investment strategy.

Our operating principles are:

  • Impact: Our aim is to develop Estonian venture capital market as well as to contribute to Estonian economic growth.
  • Profitability: Our aim is to be self-sustainable and to earn market level long-term investment income for the shareholder/state.
  • Operation on market conform terms: Each investment is made hand-in-hand and on equal terms with a private investor or investors.
  • Responsibility in day-to-day operations: We address and promote responsible principles in our operations. SmartCap has been awarded with Silver Level in Responsible Business Assessment Index.

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