Czech officials will weigh a CZK 1 billion state-backed venture fund on Monday, a move designed to channel private capital into the country’s startup ecosystem.
The proposal lands at a moment when Czech venture funding trails the European Union average. Business groups have long pressed Prague to close that gap, arguing that promising homegrown companies often look abroad for growth capital.
Under the plan, the Ministry of Industry and Trade would finance the initiative without requesting additional budget spending. The money would flow through a structure known as a “fund of funds,” meaning the state would not pick individual startups itself.
Instead, Národní rozvojová investiční, part of the National Development Bank, would manage the program. The state would back between five and seven privately run venture capital funds, with public money capped at 30 percent of each fund’s size. Private investors would supply the remainder.
This blended approach aims to develop Czechia’s venture capital market as a whole. Such financing typically gives investors equity stakes in young companies, helping them build products, hire staff, and expand operations.
Yet the proposal has drawn pushback from employer organizations. The Confederation of Industry and the Czech Chamber of Commerce both support the fund’s creation, but flag its narrow focus on early-stage startups.
Pavlína Žáková, economic policy director at the Confederation of Industry, says Czechia faces an acute shortage of financing for companies in later growth phases. When firms outgrow early-stage support and need larger investment rounds, they often secure funding from foreign investors and move their headquarters abroad.
That migration costs the state potential tax revenue and weakens the domestic business ecosystem. The Chamber of Commerce echoes the concern, noting that Czech venture capital investment has consistently underperformed compared with other EU countries.
The government’s discussion on Monday will address only the fund’s initial structure. Whether Prague follows up with measures targeting later-stage companies remains an open question for now.
