How we invest

Finnfund invests in profitable business projects that advance sustainable development and are implemented by responsible businesses in developing countries.

We only invest in privately owned businesses. Our financing is always on market terms.

In order to be eligible for Finnfund investment, the project has to be implemented responsibly, target a developing country as defined by the OECD, generate measurable development impacts, and be financially profitable.

We put special emphasis on sectors critical to sustainable development, namely clean energy, sustainable forestry and agriculture, financial institutions, and digital infrastructure and solutions. We can invest in other sectors as well when projects match our investment strategy.

Investments in different sectors

Forestry

Finnfund invests in plantation forests and related industries, such as sawmills and plywood factories.

Energy

In terms of climate change, it is crucial how developing countries respond to their rapidly growing energy needs.

Financial institutions

Finnfund invests in microfinance and other financial institutions as well as insurance companies.

Agriculture

Increasing the productivity of agriculture in a sustainable way creates jobs and increases the income of people who live on agriculture.

Digital infrastructure and solutions

Many global problems can be solved by building digital infrastructure and developing digital solutions.

Other sectors

In addition to the five focus sectors, we also invest in other projects if they meet our requirements.

Tailor-made solutions

We tailor our financing to the needs of each investee. The financing can be in the form of equity, mezzanine financing, or debt. Finnfund’s share in new companies is always smaller than the share of the project sponsor but can be greater in expansion investments. Ticket size varies from one million to 25 million euros. Finnfund financing can be in either euros or US dollars.

Finnfund is always a minority shareholder and the terms of exit will be set in advance. Typically exit is implemented so that the project sponsor acquires Finnfund’s share in the company within 5 to 7 years.

We tailor our loans to the specific needs of each project. Loans typically have long maturities varying from 5 to 10 years. Guarantees are defined based on the risk, amount of financing, and other factors.

Contact us in the project design phase

You can seek financing by sending us an informal application. For project appraisal, we will need a project plan developed by the client. We advise you to contact us already when designing the project as our experts have considerable experience in business operations in developing markets.

We strive to keep our investment process swift and flexible. The investment decision is usually done within 3 to 4 months from the first contact. Final investment decisions are taken by the Finnfund Board which meets once a month.