EIF IN
PORTUGAL
Investing in the future of Portuguese SMEs
Investing in the future of Portuguese SMEs
Small and medium-size enterprises are the heart of the Portuguese economy.
Representing 99% of all businesses and more than two thirds of the workforce, Portugal's 908,000 SMEs are responsible for driving innovation as well as spurring on growth, and their daily routine is what ensures the competitiveness of the Portuguese economy. But to do that, they often need finance.
At the same time, as the smallest actors in the economy, they are often the hardest hit when the economy encounters turbulence, which is why it is so crucial for them to have financial options in order to maintain and eventually grow their businesses.
At the EIF, our mission is to improve access to finance for small businesses across the EU. In addition to building a sustainable venture capital ecosystem through dedicated financial instruments in Portugal, we have been supporting Portuguese SMEs using a broad range of instruments, including many tailored to the needs of the Portuguese market and designed with the Portuguese government and local authorities.
As a result, we've been able to support more than 55,000 Portuguese businesses, ranging from companies specialising in digital therapy, film production, and AI-based language marketing, making sure they have the financial fuel they need to pursue their ambitions.
Our intention is to continue to extend this type of support to the Portuguese market, making access to finance easier as we collectively move towards a greener, digital and more inclusive Europe.
Success stories
Joanita Mateus
Success stories
Joanita Mateus
Data analytics is a field which is growing rapidly, particularly with the development of artificial intelligence and machine learning. “There’s a lot of demand for expertise in this field,” says Joanita Mateus, 39, from Lisbon, who holds a degree in educational psychology. Due in part to the pandemic, she decided to retrain, signing up for a data analytics bootcamp at Ironhack and with financial support from the Jose Neves Foundation.
Looking online, Joanita found a data analytics bootcamp at Ironhack, and turned to the Jose Neves Foundation for financial support. “It’s better than a normal loan because repayment starts only after I find a job,” she explains. A few months later she found landed a job at a data analytics company. “It’s better paid, better benefits, better working conditions and most importantly, I can work from home, which wasn’t possible before,” she says, before adding, “There are always new tools because technology moves fast—and that’s exciting.”
Sword Health
“Sprains, tears and back pain are only a few of the musculoskeletal conditions that cause disabilities that can ultimately turn life into a nightmare,” says Virgilio Bento, CEO and founder of SWORD Health, a company that seeks to help with recovery by acting a bit like a digital physiotherapist. “It’s not always easy to find the time to get to a physiotherapist. Now, imagine you could get your session done within a few clicks in the palm of your hand.”
SWORD Health is a virtual physical therapy solution pairing a patient with a doctor or physiotherapist—all from the comfort of patients’ homes any time of the day. “You can get on with your physiotherapy in your pyjamas at 7am or at 11pm when the kids are in bed. It’s a set of wearable motion tracking devices that communicate wirelessly with the cloud, looping back 5000 impact feedback messages that allow the therapist to guide the patient from a distance. 30% of patients recover faster and better compared to onsite therapy.”
Fado Filmes
“Fado means destiny and it’s used to refer to the traditional Portuguese music that is typically melancholic and narrates drama, loss and saudade. I chose that name for our company because I felt that cinema was my destiny. It’s a beautiful word, easy to remember and it has a deep meaning,” says Luis Galvão Teles who, along with his son Goncalo, run Fado Filmes, a film production company in Lisbon.
Fado filmes has been mainly active in film co-productions “We have produced over forty films to date with most of them being primarily co-productions. One of my first was Elles with Samsa Film, back in 1997, which sold in over 30 territories. We’ve always sought to co-produce and re-inforce European connections.” More recently, Fado Filmes has focused on TV series production: “We underwent a major transformation lately and entered a new world with series production. We have quite a few projects in pre-production and development.”
Vânia Costa
Vânia’s passion has always been programming. “It’s what I love doing. I would spend hours of my free time teaching myself different programming languages, working out how to develop software and I often designed websites for friends and family.” She used to work in marketing for a machinery company within the mould-making industry near Porto before deciding to take the leap of faith and follow her passion by enrolling in a programming bootcamp.
“The course was really intense. We would spend 10 to 12 hours online every day for more than three months. It was demanding but I enjoyed every minute of it.” Within weeks of completing the bootcamp, Vânia got a job with Deloitte as a full-stack programmer. “Everything today is dependent on technology. You need an app and programming for everything. This may sound weird, but in a few years’ time I think most jobs will be like mine. This is the future, no doubt about it.”
Sound Particles
“To put it simply, we use computer graphics techniques applied to sound. Instead of mixing sounds, we create 3D software, and position sound in a 3D space. For example, it could take days and huge resources to create the sound of a battlefield, with 50-60 sounds at the same time. With our software, in 15 minutes, you can generate more than 10,000 sounds and create a battlefield scene on a totally different level. It allows creatives to work with sound in a new way,” explains Nuno Fonseca, founder and CEO of Sound Particles.
The software initially targeted the big screen, but has since expanded to video games, with clients that include the likes of all major Hollywood studios, Game of Thrones, Frozen 2 and Star Wars 9 and Playstation. Nuno, a former university professor with a PhD in computer engineering and a passion for music and cinema, founded the company in 2016. “Having created the software, I travelled to LA and sent a few emails to some production companies. It all happened quite fast and before you knew it, I was presenting to all major studios.”
Unbabel
“Language is probably the most obvious expression of human intelligence, but the multiplicity and diversity of languages can become an issue when a company scales to other markets—from marketing to product descriptions, sales to customer service. This is what we have set out to solve,” says Vasco Pedro, CEO and co-founder of Unbabel. Based in Lisbon and San Fransisco, Unbabel is a company active in the B2B space, enabling modern enterprises to serve customers in their native languages with AI-powered, human translation support.
“We constantly train and re-train our AI systems with customer data, to make communication meaningful, so that a customer in China can write an email in Chinese, customer service receives it in English, replies in English, and the client gets the reply in Chinese - with all the jargon and technicalities accurately translated.” With a clientele that includes the likes of Microsoft, Expedia, Booking.com and Facebook, to name but a few, Unbabel is blazing a trail in machine translation.
Key figures
Over
of EIF financing
Transactions with financial intermediaries
Equity investments since inception
Guarantees support since inception
made available for
Portuguese businesses
Mandates in focus
The EIF continues to deploy capital in Portugal under a wide range of strategic programmes and mandates. Below are brief summaries of our main initiatives in Portugal.
InvestEU
The InvestEU programme provides the EU with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It is helping to mobilise private investments for the EU's policy priorities, such as the European Green Deal and the digital transition. The InvestEU Programme brings together under one roof the multitude of EU financial instruments previously available to support investment in the EU, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.
RCR
The EIB’s Risk Capital Resources (RCR) is the core pillar of the EIF’s equity activity. It has enabled us to pursue our equity strategy in the venture capital and growth segments for more than 25 years. In 2023, RCR accounted for 25% of our equity activity, committing €1.4bn to financial intermediaries.
EFSI
The European Fund for Strategic Investments formed part of the EU's Investment Plan for Europe, launched by the European Commission in 2015. EFSI addressed market gaps in financing - whether in infrastructure, research, energy efficiency or risk finance for SMEs – and mobilised private investment into these areas. Through EFSI the EIF deployed €10.5bn in resources of the European Commission, the EIB and the EIF to improve access to finance for SMEs and small midcaps.
EGF
The European Guarantee Fund was created by the EIB Group with contributions from Portugal and other Member States to protect companies struggling in the crisis caused by COVID-19. With almost €25bn in guarantees, the EGF allowed the EIB and EIF to swiftly offer companies, mostly SMEs and mid-caps, access to loans, guarantees, asset-backed securities, capital and other financial instruments. The EGF forms part of the package of recovery measures put in place by the EU, with the objective of providing a total of €540bn to support the hardest hit sectors of the European economy.
REPowerEU
The EU launched REPowerEU in 2022 to reduce dependence on fossil-fuel imports and accelerate the green transition. To support the plan, in October 2022, the EIB Group developed a package of measures focussing on renewable energy, energy efficiency, electricity networks and on deepening its engagement in green innovation and breakthrough technologies. Under REPowerEU, the EIF will invest €4.5bn by 2027 through EIF equity products.
Partnerships with BPF
The EIF and Banco Português de Fomento (BPF), the Portuguese national promotional institution, jointly manage three equity partnership which are expected to mobilise almost €1bn worth of equity investments into Portuguese SMEs and mid-caps. These initiatives have supported 12 venture capital and private equity funds, most of which are currently in investment mode. In particular, the venture capital partnership, Portugal Tech, was launched in 2018 to support early-stage companies and technology transfer projects. In 2019, the private equity partnership, Portugal Growth was launched to support the growth and internationalisation of mature companies, and in 2020, the blue economy partnership, Portugal Blue, was launched to support sustainable companies operating in ocean-related sectors.
AGRI Portugal
The AGRI Portugal mandate is a guarantee financial instrument that combines resources from the Managing Authority of the Portugal Mainland Rural Development Programme (ESIF) and the European Agricultural Fund for Rural Development (EAFRD). AGRI Portugal is expected to support up to €200m of new loans to finance investments of farmers and agri-businesses. The mandate also supports investments in the processing and marketing of agricultural products, thus contributing to promoting the sustainability and growth of agricultural businesses in Portugal. So far, the programme has already enabled investments into almost 300 Portuguese companies, a number expected to grow further until 2025.
PVCi
The Portugal Venture Capital Initiative (PVCi) was launched in 2008 in co-operation with twelve Portuguese public and private investors to support the local venture capital and private equity ecosystem. Alongside the EIF, investors included the Government of Portugal, Banco Português de Fomento, Fundação Calouste Gulbenkian, Caixa Geral de Depósitos, BPI, Novo banco, Millenium BCP, Montepio, Bankinter, Santander, Fidelidade, and Oitante. Leveraging the initial €111m of financing, seven selected funds generated further investments of around €370m into 53 small businesses in a wide range of industries across the country. The programme is now reaching the end of its life. With 80% of its portfolio successfully exited, PVCi is expected to return more than the capital committed by its investors.
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