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Innovative and Advanced Technologies
Participation Venture Capital Investment Fund

The importance of venture capital investments, which play a significant role in supporting innovation activities in economies, increasing productivity, creating employment, and reducing the current account deficit, continues to grow every day. The Innovative and Advanced Technologies Participation Venture Capital Investment Fund, established under the auspices of the Presidency of Defence Industries of the Republic of Türkiye and led by SSTEK Defence Industry Technologies Inc., in partnership with Vakıf Participation Bank Inc., Ziraat Participation Bank Inc., and Türkiye Development and Investment Bank Inc., aims to support companies operating primarily in the defence industry and advanced technology sectors. The fund is primarily focused on companies operating in strategically prioritized sectors of development, targeting high-technology production, export growth and/or import substitution potential, and benefiting from Türkiye's high economic growth potential and regional power vision. It particularly prioritizes companies with competitive advantages arising from Türkiye-specific factors such as strategic geographic location and relatively low-cost skilled labor. With the objective of enabling such innovative companies to become internationally competitive through growth financing and professional management, the fund is structured to invest—fully in accordance with participation finance principles and regulations—via permitted instruments such as equity and equity-like investment tools. The fund was established with an initial closing size of TRY 175 million.

The fund transfer process is carried out through the allocation of resources provided by qualified investors to venture companies, following the approval of the fund based on decisions made by the investment committee.

Tax Advantages of the Innovative and Advanced Technologies Participation Venture Capital Investment Fund:

  • Companies investing in Venture Capital Investment Funds (VCIF) may deduct up to 10% of their annual tax base (limited to 20% of their equity) as "Venture Capital Fund Investment" from their taxable income.
  • Since taxation is theoretically applied at the fund level on VCIF earnings, dividend distributions (profit shares) made by VCIFs to unit holders are not subject to withholding tax.
  • Capital gains arising from the revaluation of fund participation units, similar to securities, are not subject to taxation.
  • 75% of the gains derived from the sale of participation units are exempt from corporate tax.
  • Redemptions of entrepreneurial participation units from the fund are not subject to withholding tax, and investors are not exposed to any deduction.

With the Law No. 7263 on Amendments to the Technology Development Zones Law and Certain Laws, published in the Official Gazette dated 03.02.2021 and numbered 31384, a requirement has been introduced for companies operating in Technology Development Zones to allocate 2% of their tax-exempt earnings to venture capital investment funds. In cases where these amounts are not transferred by the end of the relevant year, 20% of the amount deducted from taxable income under this law will be subject to taxation.

In this context, it has been communicated that subsidiaries of the Presidency of Defence Industries of the Republic of Türkiye and TSK Foundation companies will allocate the mandatory investment amounts—required to be used for the purchase of venture capital fund units—towards the Innovative and Advanced Technologies Participation Venture Capital Investment Fund.

It is anticipated that this regulatory change, which covers the Innovative and Advanced Technologies Participation Venture Capital Investment Fund, will contribute to the expansion of the Fund by enabling investments in future defence industry domains, ranging from unmanned technologies to laser and electromagnetic defence systems, cybersecurity, space, and satellite technologies.

Venture Capital Investments

NESA Aviation and Engineering Inc. is a venture supported by Türkiye Development Fund as the lead investor, with SSTEK Defence Industry Technologies Inc. acting as an investor. The company operates in the design, development, production, and integration of critical products and systems used in the defence, aerospace, and space sectors. With its advanced engineering infrastructure and experienced expert team, it provides indigenous and critical solutions that meet high-reliability and military standards.

Within its scope of activities, the company develops advanced engineering solutions requiring high precision and expertise, including IR seeker head cooling system sub-components, munition release system sub-components, oxygen booster compressors, portable high-pressure oxygen generation and storage systems, and high-purity high-pressure dry air generation systems. It also carries out system and subsystem-level integrations across various regions worldwide.

Today, NESA solutions are actively deployed in more than 27 countries and over 300 platforms and systems, strengthening its international competitiveness and positioning the company among leading players in the sector.

Sovereign, Secure and Hyperscalable Indigenous Cloud Platform

DT Cloud is Türkiye's first hyperscalable and self-service indigenous cloud platform. Developed through local R&D, it is designed to meet the needs of defence industry, public sector, finance, energy, manufacturing, and other critical industries with its fully compliant architecture, high-security standards, and end-to-end digital sovereignty.

Simularge was established with the aim of enabling the use of its digital twin software—combining engineering expertise and artificial intelligence—within Türkiye's domestic industry. The company focuses on the digitalization of industrial production environments and the enhancement of technological capabilities. Simularge has received investment from the Innovative and Advanced Technologies Fund, led by SSTEK, a subsidiary of the Presidency of Defence Industries of the Republic of Türkiye.

SIMULARGE offers an industrial applications and development platform that integrates seamlessly operating modules for data analytics, machine learning, mechanical simulation, and application development. Applications developed on Simularge's TwinAPI and Simulstore platforms help reduce production costs, predict maintenance downtime, prevent quality issues before they occur, and deliver additional operational efficiencies.

Conduct security evaluations of your IT solutions in line with international standards with Beam Technology, an evaluation centre for Common Criteria (ISO/IEC 15408).

Leverage the cybersecurity services developed by BEAM Technology to mitigate vulnerabilities that may arise within your organization or company, and enhance your cybersecurity posture to the highest level.

In addition to tailored or periodic training in information security and our areas of expertise, you may also benefit from consultancy services in secure software development and Common Criteria compliance.

Investors