Fondo Transandino Peru
Fondo Transandino Peru (FTP) was incorporated in Lima, Peru in March 2004, during a period of solid economic growth for the country. Between 2002 and 2006, the Peruvian economy grew by more than 4% per year with a stable exchange rate and low inflation. While this environment presented promising growth opportunities for the country’s businesses, Peru’s small and medium enterprises (SMEs) lacked the necessary financing to capitalize on this growth. FTP sought to bridge this gap and connect promising Peruvian SMEs with financing for expansion.
FTP’s main investor is the SEAF TransAndean Early-Stage Fund LLC (TAF), a regional umbrella fund that was incorporated in June 2003 with a closing at $13 million. At the time of its creation, FTP was the only regulated and supervised private equity fund in Peru in which pension funds were authorized to invest. Recognizing the potential for growth among the country’s SMEs, local pension funds invested in FTP, expanding the fund’s capacity to promote promising businesses.
Over the last 15 years, Peru has experienced significant economic growth coupled with notable political and economic stability, resulting in rising domestic investment and consumption. Previously dominated by export commodities, recent growth has allowed Peru’s market-oriented economy to diversify. Trade and industries have expanded in Peru’s capital city of Lima and agribusiness has grown across the countries rural regions. Historically one of the poorest nations in the region, Peru’s expansion has led to a 15%reduction in the national poverty rate since 2002. As the country’s economy continues to grow, Peru’s SMEs are poised to further develop the nation’s middle economy and meet the growing domestic and international demand for quality, Peruvian products and services.
FTP is meeting the demand from SMEs for affordable, growth capital, providing these companies with an equity-oriented venture capital approach. In addition to financial support, FTP provides companies with demand-driven operational and management support to enhance business performance and market competitiveness. FTP completed its investment period in May 2008 with six portfolio companies, including a mango exporter, a high-end eco-tourism hotel chain, and a clean-tech hydroelectric plant. Two of FTP’s portfolio companies were given additional support by SEAF through a later fund backed by the Overseas Private Investment Corporation (OPIC).
- Region: Latin America
- Location(s): Peru
- Start Date: Mar 2004
- Status: Fully Invested
- Committed Capital: $15 Million
- Investor(s): Swiss Investment Fund for Emerging Markets (SIFEM) via TransAndean Fund (TAF); Belgian Investment Office (BIO) via TAF; United States Agency for International Development (USAID) via SEAF via TAF; AFP Integra; AFP Prima