In accordance with the Law on Budget of the Republic of Serbia for 2024. (“RS Official Gazette” no. 93/2023) and Program of allocation and use of funds for subsidies to public non-financial companies and organizations for 2024., as part of the Government Decision RS 05 No. 401-12449/2023 dated December 25th 2023.
The Innovation Fund
announces
Public Call for the Serbia Ventures AI Program
Program objective is to motivate qualified individuals, private investors and institutions with the capacity to engage in startup financing to structure their operations into conventional Venture Capital (VC) funds established in Serbia and begin investing more aggressively into high-risk/high-reward startups which are developing new products based on artificial intelligence (AI).
Within this public call, the Innovation Fund (hereinafter: IF) will gather Applications from existing alternative investment fund management companies, as well as teams whose ambition is to establish new alternative investment fund management company and operate a VC fund in Serbia. After an independent and merit-based evaluation, the IF will invest into the best Application. i.e. most perspective (existing or future) alternative investment fund management company registered in Serbia in the role of a limited partner.
The maximum amount of financing which the IF can invest in the future VC fund is EUR 5.000.000, with the restriction that the IF’s investment mustn’t exceed 50% of the size of the VC fund’s final close amount. Future VC fund must invest a minimum of 150% of IF’s contribution to the VC fund into Serbian startups.
The duration of the investment is not fixed due to lengthy investment cycles that are characteristic of the VC industry. The VC funds applying for this program should plan a general fund life of 10 years with 5-year investment periods and 5-year of divestment periods, with a maximum of 2 possible extensions of one year each, subject to limited partner’s consent.
Terms of application
In order to be considered eligible for participating in this program, the Applicant must:
- Be incorporated in the SBRA as a LLC, or as an AIF MC licensed by Republic of Serbia’s Securities Commission;
- Be owned by future GPs in the VC fund structure defined in the Application. If the Applicant is legal entity in the form of LLC, physical persons designated as GPs in the application for Serbia Ventures AI program must be sole owners of the company that applies to the program;
- Ensure that the sum of GP’s own contribution represents at least 1% of total capital raised;
- Submit full Application as stipulated in section “Application contents and submission instructions” of this manual.
At the time of applying for the Program, the Applicant is not required to be licensed by the Republic of Serbia Securities Commission.
Application contents
Each Application must be duly submitted via the portal within the given deadline for this Public call and it must consist of the following documents:
- Signed Applicant statement (in PDF);
- The business plan, provided in free format in the English language, which should be ideally up to 25 pages A4 and needs to cover:
- The VC fund’s management team (General Partners) including profiles, experiences, legal/governance structure;
- Track record of the management team (if any, or a justification of the team’s soft or hard skills and resources, particularly in the field of AI, which would ensure successful functioning of the proposed VC fund);
- Market overview and mapping of high potential sectors and/or illustrative deals;
- Capital allocation strategy (including the fund’s size, relevant investment and divestment time frames, target market segmentation, target (sub)sectors, deal flow forecast and demonstration of the ability to scout for and source high quality deals, etc.);
- Key terms and conditions (including management fee, carried interest, hurdle rate, target IRR, incentives, winding-up, etc.).
If the financing is approved by the IF, selected Awardee can sign LPA (or Investment Agreement) with the IF and receive funds within this program, only after it is fully registered and licensed by the Republic of Serbia Securities Commission and SBRA as a legal entity registered specifically for managing alternative investment funds (alternative investment fund managing company – AIF MC), and needs to register a VC fund (alternative investment fund) in Serbia and receive the appropriate license in line with the requirements outlined by the Republic of Serbia Securities Commission and other applicable legislative requirements.
The Applications will be evaluated based on the following criteria:
- Management Team / General Partner
- Market Segmentation and Pipeline Analysis
- Investment Thesis / Capital Allocation Strategy
- Fund Composition and Limited Partner Base
- Proposed Terms and Fund Economics
Application documentation can be found on the Innovation Fund’s website: Documentation
Due to the international evaluation process, submitted Application documentation must be in English.
The deadline for Application submission is September 24th 2024. by the end of the day.
Incomplete Applications, as well as Applications that are not submitted until the submission deadline will not be considered.
Please use the following link to apply: LINK
Contact: serbiaventures@inovacionifond.rs