Most of the R&D and innovation problems experienced by the private sector are due to the insufficient financial resources. Similarly, the subsidy of entrepreneurship which is vital for the dynamism of the ICT sector is also problematic.
The most efficient financial instruments developed in the advanced economies for the solution of this problem are “venture capital” and “seed capital” markets. And the primary actors of these sectors are investors, venture capital firms, entrepreneurs and stock exchanges. This system to which Turkey was introduced during 80s when she switched to a liberal market economy, has yet to reach, however, a satisfactory level and breadth. Furthermore, for an efficient working of it, first of all, a sustainable political and economical stability must achieved, the involvement of the international institutions with an active interest in venture capital must be secured, and finally, non-government institutions targeting business life must focus on and contribute to this subject. Also, political and economical stability set aside, the introduction of the other requirements call for the creation of a legal and institutional infrastructure of the venture capital market which would secure, especially, exit strategy mechanisms.
Indeed, this infrastructure exists in basic terms. For example, there is the so called “The High Council of Coordination for Fighting Unemployment and Development of Employment” which was founded on 5th January,1986, to help entrepreneurs with limited resources. But on one hand, the negative impact of political decisions on economical politics, and on the other hand, the distancing of the banking sector themselves from this subject, resulted in a futile outcome. With the publication of the “Directives about the Principles Regulating Venture Capital Investment Partnerships” in the Official Gazette number 21629 on 6th July 1993 by the Capital Market Committee, the venture capital sector acquired, for the first time, a legal framework. And the responsibility to regulate and audit the working principles of venture capital entities was delegated to the Capital Market Committee. Another modification came on 06.11.1998 with the Amendment Nr. 10 and Serial VI. Thus the regulations that governed the venture capital market became more flexible and investment issues were interpreted from within a broader perspective. Finally, with the Amendment Nr. 15, Serial VI published in the Official Gazette on 20.03.2003, further modifications were introduced and entry to the venture capital market was relaxed.
However, although a considerable time has passed since 1992 when the legal framework was first established, no considerable progress was observed in the venture capital market in Turkey. In most countries in the world, the success of a venture capital market is directly related with government subsidizing. The government funding initiative in favor of the venture capital institutions with no interest policies is especially important for a health development of the market.
Introduction of innovative projects such as technoparks and incubators are either too late or inefficient. Therefore the qualified demand front of the venture capital market cannot develop properly. First of all, on one hand the legal infrastructure should be brought to an international level and a relaxation of the venture capital market instruments should be introduced especially in the protection of exit strategy mechanisms, on the other hand, a strong and reliable institutional governance infrastructure should be created in the market. Such initiatives can bring sufficient momentum for the emergence of the market.
It is clear that the financing of the venture capital market is a must for achieving an economic environment in Turkey with an innovative, fast and sustainable growth. Therefore,
- Sustaining the political and economical stability
- Acceleration of the introduction of further funds into the market
- Support of the market with proper funding by the government
- Retirement schemes and insurance companies Introductions of funds
- Development of commerce, development and joint venture banks with an eye on the objectives of the venture capital markets
- Securing the contribution of international institutions interested in venture capital market
- Growing the number of innovative projects
- Improving the exit strategy mechanisms in investments
- Establishment of institutional governance
(M. Kemalettin Çonkar, Financing Methods for Venture Capital, Istanbul Commerce Chamber (ITO) Publications:2007-61, 2007)
There is sufficient momentum in Turkey for innovations and entrepreneurship; however, basic investment instruments should be established to support this situation in a sustainable manner.
Kaynak : 