Deputy Head of the National Investment Agency under the President, Zhalina Zheenaliev, stated that the purpose of the document is to develop the venture market and create a legal foundation to support startups and innovative companies in the country.
“We have analyzed international experience in this area. Currently, there are between 300 and 500 startups in the Kyrgyz Republic that need investments. Most of them have a social focus. In 2024, the volume of venture financing reached 1.5 billion soms. We expect that this draft law will provide support for entrepreneurs,” he added.
Furthermore, Zheenaliev mentioned that there are currently no venture funds in the country, but the adoption of this law will contribute to their creation and normalization of their activities.
In response to the deputies' question about the number of business angels in the country, he replied that at the moment there is only one business angel who has already helped implement three significant projects.
The draft law defines venture financing as a form of high-risk investments aimed at startups and innovative companies with high growth potential. It details the key participants in the venture market, including business angels, venture investors, fund managers, and the venture funds themselves.
The document also includes a section dedicated to legal instruments for venture investors. It establishes mechanisms such as a future equity agreement, convertible loan, and option agreement, which are actively used in international markets for early-stage investments in startups.
The draft law regulates the procedure for the creation and functioning of venture funds, allowing their establishment both without the formation of a legal entity and in the form of a limited partnership and other organizational-legal forms. Requirements for venture managers are established, as well as obligations for external audits and regular reporting to investors.
The committee of representatives approved the draft law in the first reading.
