In order to democratise Estonian venture capital ecosystem, SmartCap took a step further in managing direct investments and handed over the investment portfolio to a private fund manager. Thereby, SmartCap took a fund of funds approach by governing a selection of private fund managers instead of making direct investments into companies.
The ultimate aim of SmartCap is to create and maintain a sustainable and entrepreneurial environment for all participants of the local venture capital market. SmartCap aspires to make Estonia an attractive venture capital environment, which could be constituted as a considerable location for innovative technology companies with a high growth potential. This model enables the existing and potential venture capital fund managers to build up their institutional quality and manage Estonia-specific early stage investment portfolios. By partnering with several private fund management companies, SmartCap aims to build a diversified portfolio of early stage venture capital funds with specific core competences. In turn, these funds should invest the committed resources in innovative pre-seed or seed-stage companies.