Liquidity Is Key – An Investor Must Always Be Prepared
Kim Höijer
In venture capital and private equity (VC & PE), timing is known to be everything. Having the conviction to invest means little without the liquidity to act. At Tesi, we view liquidity not merely as a financial metric, but as a strategic enabler – one that underpins our ability to make long-term commitments and respond decisively in a rapidly shifting market environment.
As part of Finland’s broader response to structural economic challenges, the Government has strengthened Tesi’s industrial policy role. This enables us to act more proactively in advancing growth and attracting private capital, even in times of market uncertainty. To maintain long-term credibility in that role, we must be able to commit capital with confidence. That calls for both expertise and financial readiness, including predictable and sufficient liquidity. Without it, there is no trust – and without trust, market-based investing cannot function.
Capital needs differ depending on the investment type. Fund investments often involve delayed capital calls, whereas direct investments typically require more immediate funding and follow-on capacity. In large-scale industrial projects, we may deploy capital in multiple tranches through to factory completion. In each case, strong liquidity ensures we can respond as agreed or when the window opens.
We manage our liquidity by investing cash reserves productively but conservatively. Returns support Tesi’s operational costs and contribute to our self-sustainability. Proceeds from successful exits – such as our record EUR 77 million exit euro-wise from growth company M-Files, where we were a long-term investor since 2013 – also play a critical role. Despite today’s slower capital recycling environment, our capital base has doubled to EUR 2 billion and assets under management have reached EUR 2.6 billion, driven by portfolio returns.
Our newly adopted investment strategy for 2025–2029 is built on long-term, anticipatory deployment. Our investment capacity for the period totals EUR 1.8 billion, evenly split between direct and fund investments, with flexibility to adapt to market conditions.
Tesi’s role is to complement – not compete with – private investors.
Tesi’s role is to complement – not compete with – private investors. Our ability to act swiftly and credibly lays the groundwork for attracting private capital. The multiplier effect is significant: deploying our full EUR 1.8 billion capacity is expected to catalyse close to EUR 12 billion in private growth funding over the strategy period.
Liquidity is not just a technicality. It is the cornerstone of our ability to drive impact. Without it, we could not support scaling companies, make long-term fund commitments, or attract private investors. With it, we can help build the future of Finland’s economy, competitiveness, and VC & PE landscape.