This article was first published in the Luxembourg Private Equity Association’s magazine Insight/Out # 27 featuring a multifaceted cover dossier on the European Investment Fund (EIF) and this update with our investment managers Joel Wajsberg and Ghislain Terrier.
We are excited to highlight the new Luxembourg Future Fund 2 investment initiative in cooperation with Société Nationale de Crédit et d’Investissement (SNCI). This initiative now makes available up to € 200 million for fund & co-investments with the aim of supporting the diversification and sustainable development of the economy in Luxembourg. It builds on the successful implementation of the existing LFF 1 initiative, which was launched in 2015 and now boasts a well-diversified portfolio of exciting VC fund and co-investments.
LFF targets are future proof
Under LFF 2, we are looking to invest into VC & PE funds (including hybrid debt equity investment strategies) and via co-investments into innovative companies, to continue to foster the development of Luxembourg's sustainable and resilient economy of tomorrow.
Investments will be conducted across a wide range of sectors including climate technologies, fintech, cybersecurity, energy resilience, new space technologies, digital health and life science. By broadening the scope of this new initiative to include hybrid debt equity investment strategies, we have available non-dilutive instruments, thereby attracting a different type of company profile
Emphasis added on cooperation
The LFF initiatives showcase the high degree of complementarity that exists between the EIF and national promotional institutions such as SNCI. Looking at the successful implementation of LFF 1, one could even consider it a perfect match. While the EIF brings its experience as one of Europe’s most active LPs coupled with a pan-European policy perspective, SNCI together with the Ministries bring domestic expertise and experience with a particular focus on the needs of the Luxembourgish ecosystem.
The cooperation is a great example of how European and local entities can come together to create real value and impact on the ground. With LFF 2 now up and running we are actively seeking investment opportunities.
Interested fund managers and/ or companies (for co-investments) will need to demonstrate their “Luxembourg Sustainable Economic Substance” in order to be considered for an LFF 2 investment. These substance criteria will differ for fund and co-investments and will be assessed on an individual case-by-case basis. However, they will need to contribute towards the overarching LFF 2 objective of supporting Luxembourg's sustainable and resilient economy of tomorrow.
Investments supported by LFF
The new LFF 2 programme will feature the following two investment mechanisms:
LFF 2 Primary Fund Investments: LFF 2 will invest as a Limited Partner in venture capital and/or private equity funds (incl. hybrid debt-equity funds) in Luxembourg. Supported fund managers are expected to engage actively within the country’ investment ecosystem and consider investment opportunities in Luxembourg.
LFF 2 Co-Investments: LFF 2 will also co-invest through Special Purpose Vehicles (SPV), managed by institutional type investment funds (incl. VC & PE funds, Family Offices etc.), into innovative companies that are looking to either establish their offices/operations in Luxembourg or aiming to expand existing operations/presence here.
Companies supported via LFF 2 co-investments are expected to engage actively within the Luxembourg business ecosystem. Discover more and find inspiration in our LFF success stories.