FAPESP seeks to attract investment in small enterprises that participate in its pro-innovation program

Two calls have been issued to register equity crowdfunding platforms and angel investor networks interested in investing in deep techs.

FAPESP Innovative R&D – FAPESP is announcing two new calls as part of its initiatives to help startups attract investors, provided they are or have been supported by the Innovative Research in Small Business Program (PIPE).

The purpose of the calls is to register equity crowdfunding platforms and networks of angel investors interested in holding rounds of investment in these firms. FAPESP is proposing to establish partnerships with such platforms and networks if they have market experience and are considered capable of organizing fundraising initiatives for deep techs with the right profile to participate in the PIPE program.

Deep techs are startups whose business models are based on high-tech innovation in engineering or significant advances in such fields as clean energy, computer science, materials or chemicals. 

The partnerships will be institutional and will not involve transfers of funds between FAPESP and the partners. If a PIPE awardee is successful at winning capital injections via these agents, it can apply to FAPESP for additional investment via a PIPE Invest project. FAPESP will decide based in PIPE Invest’s assessment procedures whether or not it will supplement the investment disbursed by a platform or angel investor network.

Crowdfunding

The first call focuses on widening access for current or former recipients of PIPE grants to electronic platforms that enable investors to buy their securities (crowdfunding). The call for registration of these platforms is at: fapesp.br/16321. Applications for partnership can be sent until 6 p.m. (Brasília Time) on November 10 by email to: [e-mail]. 

Angel investors

The second call focuses on widening access for PIPE awardees to funding from individuals organized in angel investor networks and prioritizes those with a special interest in deep techs. The call for registration of these networks is at: fapesp.br/16322. Applications for partnership can be sent until 6 p.m. (Brasília Time) on November 10 by email to: [e-mail]. 

Investment funds

On September 18, FAPESP issued a call addressed to seed funds and multistrategy equity funds that are in the fundraising stage or already investing in deep techs. The call, which invites proposals for FAPESP to buy shares in these funds, is at: fapesp.br/chamadas2023/fundos.  

Scale-up investment

Between its launch by FAPESP in 1997 and end-2022, PIPE supported 1,853 firms based in 167 cities throughout São Paulo state. Some of these firms have developed technology that is exported to various countries. A survey of former recipients of PIPE funding conducted in April 2021 showed that 75% had not received any further capital injections. Among those that had. half reported investment by angel investors. About 20% said they had received funding from other firms, and venture capital or private equity funds had invested in a similar proportion.

To help startups in São Paulo surmount this obstacle and survive “death valley”, FAPESP’s Board of Trustees approved a resolution to invest BRL 150 million over the next six years in new initiatives aimed at diversifying support for PIPE awardees. The three calls described above are among these initiatives. 

For more information about PIPE, visit bv.fapesp.br/en/266.