Community Development Venture Capital Alliance

CARESBAC Bulgaria
Main Offices: 20-22 Zlaten Rog St., Floor 5th,kv. Lozents, Sofia 1407, Bulgaria
Website: www.seaf.bg/caresbac
Email: office@caresbac.com

Fund Manager: Small Enterprise Assistance Funds (SEAF)

Key Personnel: Magda Kowalska, Director General

Established: 1994

Total Committed Capital: US $7.6 million

Amount Invested: US $5.98 million (79%)

Shareholders:
Small Enterprise Assistance Funds (SEAF), via grant from the United States Agency for International Development (USAID)
European Bank for Reconstruction and Development (EBRD)

Geographic Focus: Bulgaria

Background
CARESBAC-Bulgaria was established by SEAF, with the help of a USAID grant, and by the EBRD to invest in small and medium-sized enterprises (SMEs) in Bulgaria. The Fund is now fully invested and SEAF is pursuing exits for the portfolio companies. Investments are made in combination with a management training and technical assistance component in order to enhance the business performance of the Fund's investments and to help meet its developmental objectives. The Fund actively assists its portfolio companies in implementing appropriate improvements in management techniques and practices, especially relating to financial control, cost accounting, quality control, and marketing. In addition, the Fund Manager's investment officers are actively engaged in implementing business strategy and in following-up with advice rendered by outside experts. Business support programs are sponsored not only by the Fund, but also by other international and local agencies.

Social Mission
By providing affordable financing to private sector SMEs in underserved markets, the Fund seeks to build the capacity of SMEs to expand production, access new technology, improve competitiveness, reach wider markets, increase profits, and achieve long-term commercial sustainability. By supplementing investments with technical assistance, SEAF aims to help develop business and management skills, improve corporate governance and transparency, and formalize legal structures, business structures, and tax reporting. The development of a vibrant and sustainable SME sector will help to generate new employment, export revenues, and government tax revenues; stimulate economic growth; promote free markets; improve social welfare; and contribute to political stability in developing countries. The Fund also seeks to provide examples of successful private enterprises to entrepreneurs and investors, help SMEs establish new customer and banking relationships with the formal banking sector, create a culture of equity investment, institutionalize investment methods and structures, and help to develop the country's overall financial sector.

Investment Information
The Fund invests in enterprises in Bulgaria engaged in a broad diversity of sectors, with a special emphasis on companies that are export-oriented, those with strong growth prospects, and those operating in agribusiness and light industry. The Fund will not invest in enterprises engaged in the following activities: banking, insurance, and financial services; speculative investment activities such as real estate or commodities trading; production or sale of tobacco products or hard alcohol; arms manufacturing or other military-related activities; operation of casinos or other gambling-related activities; operation of abortion clinics; or activities harmful to the environment. The fund invests in SMEs. The initial investment sizes range from US $100,000 to US $500,000, and can reach US $1 million when the partnership has proven to be successful. In most cases, SEAF-Bulgaria seeks existing companies with a history of growing revenues and profits, although they do consider exceptional start-up opportunities. Investments are made in combination with management training and technical assistance provided by U.S., international, and Bulgarian-sponsored business support programs and by the Company's local management.