By Derek Newberry

On December 6-7, the Brazilian agency FINEP hosted an Investor Forum to bring together emerging entrepreneurs and investors in Belo Horizonte.  FINEP's regular forums have so far facilitated investments in 28 new enterprises since 2000.

On December 14, New Ventures Brazil, a WRI's New Ventures partner, hosts its 3rd Annual Investor Forum at Fundação Getulio Vargas in São Paulo. The 2006 selection of New Ventures enterprises includes companies from seven states working in clean technology, new materials, organic agriculture and other sustainable development sectors.

Why the focus on small and medium size enterprises (SMEs) in developing countries?

Citigroup and the Economist Intelligence Unit (EIU) just released their Tapping the Entrepreneur joint report, based on 670 surveys from throughout Asia. The report shows how SMEs are honing their skills, getting more competitive, and becoming increasingly crucial for economic growth. In China, SMEs are responsible for 70 percent of foreign trade. The survey finds that 43 percent of SME entrepreneurs expect to grow significantly, in part because they think they can react and innovate more quickly and have closer customer relationships than their large corporate competitors.

Still, SMEs face many challenges. The ratio of SMEs to all businesses is 6 times smaller in developing countries compared to industrialized countries. The Citigroup/EIU report also cites access to financial resources and investment capital as significant barriers for SMEs.

The report focuses on Asia, but it raises issues for SMEs everywhere. It points to the need for SME support from government agencies and business incubators.

For example, the New Ventures Investor Forums bring together financial, government, and business communities to work on ways to actively support SMEs. Entrepreneurs receive business plan mentoring, management training, and access to global investors. Those with outstanding business models receive essential financing, mentoring and other forms of assistance.

For more information about the New Ventures Brazil and FINEP Investor Forums, please contact Mareike Hussels.