The Croatian financial market offers companies mainly traditional ways to raise money. This makes it hard for many companies lacking collateral, track-records and stable sources of revenues to get the financial help they need to grow. Startups especially are hurt because they are considered high-risk investments, as are companies operating in sectors with greater uncertainty and more unpredictable rates of profit and revenue. Supporting Croatia’s immature venture capital and private equity markets could be a good way to offer these companies the funds they need.

The Croatian Bank for Reconstruction and Development, known as HBOR, aims to develop a stronger private equity and venture capital market in the country. It wants to mobilise at least €100 million from different sources and invest alongside private investors in new equity initiatives.

HBOR requested the European Investment Advisory Hub’s support in strengthening its internal functions and helping it gain a better understanding of the private equity and venture capital market’s needs, opportunities and barriers. Experts mobilised by the European Investment Advisory Hub are providing HBOR’s staff with a market assessment and proposed investment strategy together with training, coaching and information sharing, with the aim of developing their expertise in equity investments. Private equity provides a firm with capital in return for total or partial ownership. The investor may take on some of the firm’s management and may share the firm’s profits. By showcasing best practices from other EU Member States and fostering the participation of public and private investors in equity initiatives, this advisory assignment is helping to turn HBOR into a centre of excellence in the world of private equity and venture capital in Croatia.

"Our main goal is to increase the quality and volume of sustainable public sector investments in Croatia and contribute to balanced social and economic regional development."

Tamara Perko, president of HBOR’s management board

The support to HBOR was provided as part of a cooperation agreement between the European Investment Advisory Hub and the EIF-NPI Equity Platform. The platform was launched by the European Investment Fund and the European Commission to promote knowledge sharing and best practices between NPBIs and the EIF. In 2021, the European Investment Advisory Hub and the platform launched a pilot cooperation programme, in which advisory experts helped members of the platform build their capacities and raise their awareness about funding and investment opportunities, and assisted them with advisory support. After a successful pilot year, the advisory cooperation will continue under InvestEU.