The Multilateral Investment Fund announced today the approval of a $4 million equity investment and a $75,000 technical cooperation grant for the Dynamo Venture Capitals DVC II Investment Fund for Brazilian Small and Medium-Sized Companies.
The fund will provide equity and convertible debt financing, financial and technical advice and value-added governance to approximately 12-15 Brazilian companies focused on technological innovation. The funds projected maximum capital will be 60 million reais (approximately $21 million) over a 10-year maximum lifetime.
The fund, selected in a competitive process, will help close the gap for small and medium-sized growth companies that currently have no access to long term financing and will increase their operating standards. The investment strategy will focus on well-managed companies in sound industries; a value-oriented, long-term approach to investments; and the use of corporate governance as a tool to improve returns.
In addition to the resources from the MIFs Small Enterprise Development Facility, the fund expects to attract private sector investors and several Brazilian pension funds.
The Multilateral Investment Fund is an autonomous fund, administered by the Inter-American Development Bank, that provides grants, investments and loans to promote private sector growth, labor force training and small enterprise modernization in Latin America and the Caribbean.