Frequently Asked Questions about the Innovation Fund

What types of projects does the IF invest in?

The IF invests in commercially viable innovative projects in a wide range of sectors including:

• Environmental management

• Waste management

• Culture: music, arts and craft, films, etc.

• Information technology

• Energy conservation

• Tourism product innovation/diversification

• Non-traditional agriculture/agro-business

How much funding can my project/business receive from the IF?

Applicants can receive from $25,000 to $250,000 in equity funding from the IF.

How does the IF's equity funding work?

EGFL purchases common shares or preferred shares in your company on behalf of the IF.  The conditions of the investment are specified in a shareholders agreement.  These conditions include giving EGFL the right to be represented on the Board of Directors of the clients? company.  Entrepreneurs are given the first choice to purchase the EGFL's shares in their companies at a predetermined time and minimum price. 

How can my project/business qualify for funding from the IF?

In order to receive funds from the IF, your business must be innovative, commercially viable, and incorporated with a majority of shares owned by Barbadian residents.  Furthermore projects should:

1. not have a potentially negative impact on Barbados? land and/or the marine environment;

2. directly or indirectly be a net generator/saver of foreign exchange;

3. not be focused on real-estate development, traditional agriculture or manufacturing; and

4. be in a new, emerging/ or re-emerging under-developed sector or sub-sector of the Barbadian economy. 

What is the procedure for applying for funding?

Applications for funding should be presented in a well prepared proposal.  The proposal should include:

• an overview of the project, clearly demonstrating its innovativeness and potential to generate significant market demand;

• a development plan of the project from concept to commercialisation;

• strategic plans (including marketing plans) for next 3 to 5 years;

• realistic financial projections (balance sheets, income and cashflow statements) for a minimum of 3 years.

Does the IF required security to invest in my project?

No security is required to access IF funding.

Who makes the investment decisions?

All investment decisions are made by the Investment Committee of the IF.

How long does it take for investment decision to be made?

EGFL strives to have investment decisions made within 4 to 8 weeks after the receipt of an application.  However, the actual time taken depends on the quality of information submitted by applicants. 

Is there an interest charge on IF investments?

There is no monthly interest or annual dividend payments required if common shares are purchased.  However, annual dividend payments ranging from 8% to 10% are requested if preferred shares are purchased. 

For how long will IF funds be invested?

IF usually invests for 5 to 7 year periods.  The option to extend the investment period to 10 years is also available by mutual agreement.  The actual duration of investments is determined based on the projected cashflow dynamics of each project.  Clients are given the option of redeeming the IF shareholdings each year during the investment. 

What role will EGFL play in my business?

EGFL will function as a strategic partner providing advisory services, access to our network of business contacts and clients and technical assistance in some cases.  EGFL also insists that good corporate governance practices are followed and accounting information is accurate and kept up to date.  EGFL does not get involved in the day to day management of your business.