The operation, which will be carried out through the Latin American Venture Capital Association (LAVCA) is designed to promote greater participation from international and local investors in the allocation of resources to the region.

“LAVCA will coordinate with local venture capital associations to foster development and competitiveness of small and medium-sized enterprises in the region,” stated MIF Team Leader Susana Garcia-Robles, adding that: “Programs to be supported will include research, dissemination of best practices, networking and advocacy to both investors and policymakers.”

The project has a regional focus, but will target in particular Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Mexico, Peru, Trinidad and Tobago and Uruguay, countries with a basic minimum level venture capital development. “Fund managers, investors, entrepreneurs and small and medium-sized enterprises will be the beneficiaries of a more developed regional venture capital industry,” said Garcia-Robles.

“Due to the nascent stage of the industry in the region, it is difficult for private funding alone to support the growth of strong local associations, making public sector support essential at this time,” added Garcia-Robles. “Associations were formed in Brazil and Mexico, and MIF supported programs related to the development of capital markets in Peru and Colombia, currently helping to create national associations in those countries. Additional national associations are underway in Argentina, Chile and the Caribbean.”

The Latin American Venture Capital Association (LAVCA) was created in 2002 by venture capital funds active in Latin America and the Caribbean to foster a venture capital industry in the region.

The Multilateral Investment Fund (MIF) is an autonomous fund, administered by the IDB, that provides grants, investments and loans to promote private sector growth, labor force training and small enterprise modernization in Latin America and the Caribbean.

Financing for this operation comes from MIF’s Small Enterprise Development Facility.

LAVCA counterpart funds will total US$250,000. Additionally, the Andean Development Corporation or Corporacion Andina de Fomento will provide US$250,000 to the program.