The European Bank for Reconstruction and Development (EBRD) put €10 million into a new Estonian tech fund that buys shares from startup founders and early employees in Baltic and Eastern European countries, according to a official release from the bank. Siena Secondary Fund II, run by Tallinn-based Siena Venture Partners, aims to raise €50 million total to invest in tech companies that have moved past their early startup phase. The fund focuses on businesses that already have proven models and solid revenue streams.
The fund works differently than typical venture capital. Instead of giving money directly to companies, it buys shares from existing owners like company founders, employees, and first investors. This lets these people cash out some of their holdings in companies that are doing well but haven’t gone public yet.
These secondary market deals help solve a big problem in the region’s tech scene. “Secondary market transactions provide much-needed liquidity to key players in the market,” the EBRD explained. When founders and early backers can sell some shares, they often reinvest that money into new startups. This creates a cycle that helps more tech companies get started and grow.
The Baltic states and Eastern Europe are still building their venture capital markets. Secondary funds like Siena’s are rare in the region, but they’re seen as important for creating a healthy tech investment environment. When people know they can eventually sell their stakes, they’re more likely to start or invest in new companies.
The EBRD has been a major player in the region, investing €36 billion across nine countries so far.
