Venture Capital Equity Fund Co. Ltd. (VCEFL)

Overview

As part of the wider Tobago Business Development Strategy, the VCEFL provides an alternative to debt financing for entrepreneurs on the island through the offer of ‘patient’ capital by way of equity investment in companies. VCEFL provides investment in exchange for an equity stake in companies. VCEFL provides equity investment, on a selective basis, in cash for equity transactions after due diligence is performed.

The VCEFL is THA’s response to the well-documented lack of equity capital available for small business financing in Trinidad and Tobago.

Eligibility

VCEFL makes equity investment in companies and provides an alternative to debt financing.

Specific Requirements

Businesses must be incorporated or continued under the Companies Act (1995) or be designated a CARICOM enterprise under the CARICOM Enterprises Act (1991) i.e. no sole traders.
The business owner must contribute to the project.
Equity Split: VCEFL is governed by the Venture Capital Act of 1994, which states that a venture capital company (VCC) cannot be a majority shareholder. Therefore, VCEFL can hold no greater than 50% of the ordinary shareholding in the company requiring investment in order to remain a minority shareholder.
Investment Range is TT$500,000 – TT$5.0 million.
Investment Exit window is 5 to 10 years post investment.
The arrangement is governed by the Shareholders Agreement (contract).
VCEFL Representation on the investee company Board of Directors to represent VCEFL interests and ensure that the investee company is being managed effectively and in a way that aligns with the investor’s investment goals.

VCEFL targets investment in the following preferred sectors:

Agriculture and Agro-processing
Light Manufacturing
Information and Communication Technology (ICT)
Green Technology and Renewable Energy
Niche Tourism
Creative Arts & Entertainment

Required Documents

Submission of a business plan constitutes the request for investment funding.

Our detailed business plan guideline document highlights all the aspects that must be included in the business plan. It is on our website: https://tobagoventurecapital.com/policies-and-guidelines/

Application Process

Below is an overview of the process i.e. business plan evaluation, investment decision, investment approval, and disbursement of funds:

Initial Review, Due Diligence and Evaluation of the Business Plan.
Review of the Business Plan by the VCEFL Investment Committee with recommendation.
Review of the Investment Committee recommendation by the VCEFL Board of Directors.
Presentation of a Note to the Secretary for Finance, Trade and the Economy.
Presentation of the Note by the Secretary for Finance, Trade and the Economy to the THA Executive Council for investment approval and release of funding.

Downloads

There is no application form. Submission of a business plan constitutes the request for investment.

The business plan guideline document can be found on the VCEFL website: https://tobagoventurecapital.com/policies-and-guidelines/