Tenerife Launches €1 Million Fund to Boost Local Startups and Innovation

The Tenerife Island Council is shifting its economic strategy by moving away from traditional subsidies toward a new model of institutional investment. The council has officially launched the Tenerife Accelera Fund, a financial tool designed to provide capital to startups and growing businesses through 2031.

Starting with an initial investment of one million euros, this initiative aims to solve a long-standing issue for local businesses: the difficulty of securing specialized funding for scalable projects. Under the leadership of Rosa Dávila, the Council expects this public funding to act as a catalyst. The fund requires professional managers—regulated by the National Securities Market Commission (CNMV)—to attract private investment equal to at least 110% of the public contribution. These managers will be chosen through a competitive bidding process to ensure that all financial decisions are based on professional expertise.

The move is part of a broader effort to diversify Tenerife’s economy. Innovation Minister Juan José Martínez explained that the primary goal is not to generate financial profit, but to retain local talent and create high-quality jobs. The fund will follow the island’s Innovation Master Plan, focusing on strategic sectors that help local companies compete globally.

This approach mirrors successful strategies used by other European governments to bridge the funding gap for new businesses. By taking on the initial investment risk, the Council hopes to transform Tenerife into a hub for specialized investors who previously found it difficult to operate in the region. The long-term success of the project will depend on the ability of these supported companies to grow and help build a more resilient, technology-driven economy for the island.