In an announcement that many in the startup world might see as overdue, Portuguese Prime Minister António Costa Monday announced it would launch a €200 million venture capital matching fund to attract overseas startups to relocate to Lisbon and the Atlantic country’s other cities.
Costa declared the new cash pool — dubbed 200M — at the opening of Venture Summit, part of Web Summit 2016 which relocated this year after all previous events had been held in Dublin. The money will actually operate similarly to a fund of funds, in that its applicants will be other venture capital funds primarily from outside Portugal who will apply the funding to help local startups go international.
“We’ve realized that the best way to support financing is via co-investment and launching this program,” Costa told the crowd (Portuguese). “We created this new instrument because we believe that if we make money available to the right people to implement the right processes, we’ll be able to make the big investments to help reinforce a more dynamic and innovative economy.”
Recipient companies will have to be headquartered in Portugal, so there is the off-chance this will be used as a way to lure developing companies to relocate to Lisbon, Porto, or Braga.
João Vasconcelos, Portugal’s Secretary of State for Industry, told Jornal de Negocios, “We want to attract the best investors, and not only venture capital investors. For the first time, we value investors who have industry ‘know-how.’ We want investors who are comfortable with digital, with robotics, biotech, with pharmaceutical, and with renewables.”
Portugal clearly is drawing attention with a decent cost of living, a friendly climate for would-be foreign IT workers, and the introduction of Web Summit as a feather in its cap for at least the next three years.
Still, help on the VC scene would be welcome. Portuguese startups have increased their intake to €41.3 million in venture capital so far in 2016 according to Tech.eu, about 40 percent higher than 2015 numbers. Compared to Ireland, the previous Web Summit host, Portugal does not have the same reputation for hosting foreign companies with extremely enticing tax rules.
The conference got off to an odd start last night when event founder Paddy Cosgrave had to cancel a Facebook Live demo to open Web Summit because of . . . web connectivity issues. Six hundred people in the investment capital industry were gathered for the Venture Summit portion, while all of Web Summit reportedly has drawn 50,000 attendees in what could bring Lisbon a reported €200 million worth of business to the city thanks to the massive influx of visitors.