Good practice:

“KIKštarter pospeševalnik” – local investment found for local economy growth

In 2015, group of successful entrepreneurs and companies from small Slovenian city of Kamnik (around 15.000 inhabitants) come together and decided to establish local private investment fund in order to boost local economy.
Private investments funds are still quite new thing in Slovenia. Beside some funds and angel investment initiatives in capital city of Ljubljana there are basically now such possibilities outside capital. So new entrepreneurs and start-up are still using a lot of classical financial methods such as bank and government loans. Also, people and companies with surplus of money tends to invest in more classical assets such as real estates or bank deposits.
So group of entrepreneurs from Kamnik decide to change that through their own small invest fund. Beside boosting local economy in the city, their aim is also to break stereotypes about investments and to educate other companies how to successfully invest in start-ups.
Fund called “KIKštarter pospeševalnik” was founded by 11 companies from city of Kamnik. They started with total amount of 60.000€. After 5 years of work fund invested in some 10 local companies, helping to create at least 15 new jobs in town. They also raise number of angel investors in city, from 0 in 2015 to 20 in 2020. Fund grew to about 100.000€ by the end of 2020 and it planes to continue its activities further on with two main pillars investing in local economy and educating about positive sides of investing for established companies.

Firstly, you need some initial funds to make initial investments. In this case it was 60.000€. Operating costs of fund are now around 3000€/year (Promotional events, taxes, accounting, office costs).
Estimated manpower needed is one part time employee. This work is now done by founders voluntary.

- Fund invested in 10 local start-ups from Kamnik
- 15 new jobs created
- Raising awareness about private and angel investments. 0 angel investors in Kamnik in 2015 to 20 in 2020
- Fund increased initial funds from around 60.000€ to around 100.000€

Main challenge here is that this initiative needs to come from entrepreneurs themselves. If they will not see added value in it, it would be nearly impossible to start with such initiative. But good results in other regions, such as city of Kamnik, can definitely help in this initial phase.

We think that this good practise could be quite easy to transfer to other regions, especially if there is already some sort of established local entrepreneurial support system (coworking, university, business club…). We need to inspire local entrepreneurs which are already established and successful to give back something to community. This can be done through educational workshops and networking activities. Especially in times when interest rates on banks are rather low and real estate market is near record hights, entrepreneurs will search also for alternative ways to invest their surpluses.
Once you had that community establish, they just need to create fund, establish rules of investment and dedicated one person to work on daily operating tasks. This good practise can bring great results especially in smaller communities which are more connected and where aren’t that much possibilities for entrepreneurial growth and support.