IM Ventures is currently in the seeding phase of creating a fund for SMEs with export potential - Scale Manufacture & Export Fund.
The Scale Manufacture & Export Fund (SMEF) is a high-growth special purpose vehicle which aims to provide local SMEs with an opportunity to access capital in order to reach new markets.
The Fund Target: To invest in up to 20 SMEs operating out of Lebanon with sustainable and scalable business models, and products geared towards export;
The Fund Sector of focus: Local manufacturing including:
- Agri-food (including Food & Beverage)
- Chemicals (Perfumery, Beauty products & Cosmetics, Pharmaceuticals)
- Paper & Textile (including Fashion)
The Fund Selection Criteria: Interested SMEs to comply with the below selection criteria (75% compliance):
- Growth-stage companies
- Turnover > $500K
- Exports > 30%
- Profitable Unit Economics
Investment Tickets: Up to $2 Million
Term of Investments: Up to 5 years
Expected Launch Date: Q2 2022
Proposed Financial Instrument: Convertible Revenue Loan
Principal Repayment Grace Period: Flexible Over 5 years out of which 2 years grace period
Interest (Payment in Kind – PIK): 8% per annum (paid at the end of the loan duration)
Royalty Fee: 8% of delta sales (Year on Year growth) with delta sales being = sales of current year - sales of previous year
Cap on Royalty Fee: Might be capped yearly based on due diligence results
Collateral: Conversion to equity clause in case of default &/or Capex