Fund to support small and medium Jordanian enterprises to be launched

AMMAN — A Jordanian fund will launch next week with $98 million in capital, aiming to support young entrepreneurs and enhance the entrepreneurial ecosystem, an official said on Tuesday. 

During a meeting held with media outlets at the fund’s headquarters, the general manager of the umbrella fund, the Innovation Startups and Small and Medium Enterprises Fund (ISSF), Muhab Murar, said that Jordanian entrepreneurs represent 25 per cent of Arab entrepreneurs.

“ISSF will invest up to $6 million in the next five years to enhance and develop [the] entrepreneurial ecosystem through offering programmes and trainings through our partners like INJAZ,” Murar added, noting that a lack of scientific research is among the challenges facing the economy. 

 ISSF is a private joint stock company owned by the Central Bank of Jordan (CBJ) and Jordan Loan Guarantee incorporation.

 “The fund aims at improving and developing innovative ideas that can expand locally and globally,” Murar said.  

Funding is among the main obstacles facing entrepreneurs in Jordan.  “Venture capital funding is considered risky for investors and banks, but ISSF will be ready to invest in such projects,” Murar noted. 

Taxes and legislation that govern establishing investment funds for example are considered challenging and generally limiting, but some entrepreneurs also lack soft skills that would encourage investors to risk their money. 

CBJ funded $48 million of the capital and the World Bank funded $50 million of it with an easy loan that will be paid over a period of 35 years, he said.

The project will support women and youth, “25 per cent of the [fund’s] targeted groups are business women and another 30 per cent are of youth. We aim at supporting 825 projects, 150 of which will be startups,” according to the press release. 

Enhancing the Jordanian economy and contributing to GDP is a goal, “ISSF is not looking for quick successes but for the long term achievements. We are aware that among 10 entrepreneurs, one or two succeed but they would reimburse all the losses and generate greater profits,” the general manager said. 

ISSF would directly invest in venture capitals, wishing to get a fund that ranges between $500,000 and $1.5 million, he said noting that Investment will be based on partnership approach, through which partners share risks. 

 On the other hand, indirect investment will take the shape of investing in local, regional or global investment funds willing to invest in the kingdom, Murar said. 

He added that ISSF hopes to encourage the establishment of new investment funds, stressing that there are only around five private and public investment funds in Jordan which offer financial and strategic support to entrepreneurs. 

ISSF is ready to invest in all sectors except real estate, construction and heavy industries, he added.