The European Investment Fund (EIF), established in 1994, It is an EU body with the mandate to facilitate access to finance for European SMEs, by sharing or reducing the financial risk.
In 2024, the EIF channeled €14.4 billion of financing towards deeptech, life sciences, greentech, social impact funds, dual use defense technologies, and scale-up funds.
Near to 43% of these investments (€6.1 billion) were green, and 45% went to regions in which economic development is below the EU average. with "€143.7 billion in assets under management." Its main operations are in the areas of venture capital, private equity, private debt, guaranteeing loan portfolios, and securitization. As of 1 January 2023, the Chief Executive is Marjut Falkstedt.
The EIF implemented the SME portion of the EU's European Fund for Strategic Investments (EFSI), also known as the Juncker Plan. Since 2021, the EIF and the EIB have had a key role in implementing InvestEU, which is the successor to Juncker's EFSI.
The EIF participated in the EU's COVID-19 crisis response via the €25 billion Pan-European Guarantee Fund (EGF), launched in August 2020 to help SMEs through the crisis.
History
The EIF was founded in 1994 by the European Community (represented by the European Commission), the European Investment Bank and private financial institutions from 12 European countries. The Statutes set the goals and the operation of the EIF under the European Investment Bank framework. It established EIF as a public-private partnership with the initial capital of 2 billion ecus, divided into 2000 shares. The 1994 Statutes specified that the task of the Fund was to support “the development of trans-European networks in the areas of transport, telecommunications and energy infrastructures, and the development of small and medium-sized enterprises”, The list of initial shareholders included financial institutions from Belgium, Denmark, Germany, Greece, Spain, France, Ireland, Italy, Luxembourg, the Netherlands, Portugal and the UK. centered around the European Fund for Strategic Investments (EFSI), the EIF led the implementation of the SME Window of EFSI.
In 2024, the EIF marked 30 years of operation and became the official partner of the European Association of Guarantee Institutions (AECM). European Investment Fund estimated that, in the three decades since founding, it has financed around 2.1 million of micro, small and medium-sized businesses in Europe. It is an enabler of EU policy objectives.
Key SME finance initiatives of the EIF are the InvestEU programme and ETCI fund of funds.
InvestEU
InvestEU accounted for around 45% of the EIF activity in 2022, and for 40 percent (€5.75 billion) of the EIF commitments in 2024. Under the InvestEU program, the EIF launched the first guarantee instrument “dedicated exclusively to sustainability”.
ETCI and TechEU
The European Tech Champions Initiative (ETCI) is a fund of funds that was launched in February 2023 by Belgium, France, Germany, Italy and Spain, together with the European Investment Bank Group. The ETCI invests in venture capital funds that invest in European scaleups, i.e. fast-growing tech companies. The EIB reported that the majority of capital for later-stage funding of European scaleups (typically in the range above €50 million) is coming from outside Europe; for such rounds of funding, “there are at least seven times more funds in the US than in the EU”. Stakes in EU tech companies are often sold out of Europe, and often to US investors. TechEU aims to support European tech innovation and close the funding gap with the US. In July 2024, the EIF signed a Memorandum of Understanding with NATO’s Innovation Fund (NIF).
Governance
The European Investment Fund is managed by three authorities: the General Meeting, the Board of Directors and the Chief Executive.
General Meeting
The General Meeting is held at least once per year. The Board meets nine to ten times per year and is accountable only to the General Meeting.