why would you sell your VC firm?
#136
Hey there,
Welcome to Sunday CET, our weekly coverage of what’s interesting in the Euro investment space.
This week:
why would you sell your VC company
assessing startup founders stamina by their school degrees
the difference between Sweden and Switzerland.
But first, PSA: at the end of January we’re doing a snowboard/ski get-together in the Alps (in Italy) - think of it as a casual, fun occasion for startup people and investors to hang out. Let me know if you’re interested.
Have a good one,
Dragos
Interesting Euro deals
🇩🇰 Enterspeed, software startup developing a low-code editor, raised a seed extension.
🇫🇮 Apiable, which does API Portals sold as a service, raised $500k pre-seed.
🇷🇴 Licenseware, building an app ecosystem for software license management, raised $1 million seed.
🇸🇪 Claims Carbon, data provider selling carbon-related-intel to insurance companies, raised $1.2 million seed.
🇪🇸 xceed, building a business on top of a social network for nightlife in Barcelona, raised $2 million.
🇳🇴 Adminkit, doing HR SAAS for SMEs, raised $2.5 million.
🇫🇷 Simbel, also developing an HR SAAS, raised $4.2 million seed.
🇬🇧 Surfboard, developing planning software for customer service teams, raised $5 million seed.
🇬🇧 Julienne Bruno, an alternative food producer of plant-based grocery staples, raised $6 million.
🇮🇹 Hlpy, provider of a digital roadside assistance service, raised $7.8 million series A.
🇩🇪 Scantinel, developing next gen Lidar tech, raised $10.4 million series A.
Source: N9
More intel bits
💲 Fresh powder:
OTB Ventures (€150 million)
Alpha Intelligence Capital ($100 million)
bValue (€72 million)
Pact VC (£30 million)
Hypernova ($25 million)
💼 Exits
German VC firm embedded/capital was acquired by Motive Partners, an US-based, fintech-focused PE firm.
Embedded is an investment vehicle used by Ramin Niroumand and Michael Hock (both ex-finleap) launched in 2021 at a fund target of 100 million, 80 of which were announced as closed.
The company is backed by a 11 pax team (not small!), and the only LPs mentioned in the PR spiel are some wealthy German individuals - Solarisbank’s Roland Folz, former Ferrari CTO Michael Leiters, and Cherry Ventures founding partner Filip Dames.
Embedded did early stage venture transactions, with a portfolio of some 9 fintech deals and they will join Motive’s VC arm, which has 14 people in NYC and London.
Motive employs 220 people, covers all the stage spectrum, as it does both VC and PE, w/ the ones from Europe including Credix (series A), Backbase (growth round) and Pollinate (series C). It is led by a British lady - Blythe Masters - ex-investment banker at JP Morgan and referred to as the woman who invented financial weapons of mass destruction, as she was quite a savvy juggler during the 2008 financial crisis.
She is one of the reasons for paying attention to this deal, I believe, besides the obvious oddity. While for Americans a deeper Euro market entry seems like a reasonable assumption, why would the Germans sell though remains a mystery. Why would you sell your AUMs, if you already figured out an investment model that is working? Some possible answers:
the Germans looked for an American structure to operate the company and acting as an office of a larger co. looks safer than solo competing as yet another undifferentiated VC shop in a hyper competitive local environment.
the American branded VC advice is more appreciated by the Euro startups ecosystem, perhaps? More resources and best practices access that would only augment the quality of the advice, particularly on the path to liquidity, which is a weakness for any standard European VC.
the American connections and boots on the ground are a better sell to Euro startups looking to grow outside Europe.
the German founders will just cash out and go fishing.
Am I missing something here? Please let me know.
Eight Roads and Fidelity exited from London-based asset management startup Alpima, flipped to Quantifeed, a Hong Kong-based automated investment platform. Alpima had raised some $2 million.
REVIEWS.io was acquired for $72 million by an American company.
Zapp, a British maker of electric motorcycles, went public via a SPAC at a $573 million post-merger value.
✍️ Also notable:
468 Capital led the $10 million seed round raised by Capitol, a NY-based health care data AI startup led by former Airbnb design lead Shaun Modi.
Accel, Seedcamp, 20VC and Hopin’s founder Johnny Boufarhat backed a $3.5 million seed round raised by the Canadian no-code ecommerce developer Popup.
Speedinvest joined Sequoia in a $1.1 million preseed round closed by South Africa’s Revlo, which does payment SAAS.
BackingMinds VC from Sweden hired a team in Denmark, Earlybird Venture from Germany opened an office in London.
EF launched a specific track for graduate students looking to start a company. To apply they keep the same conventional format which always baffled me - evaluating entrepreneur potential is like a job application as a team lead accountant (they have 5 fields asking about your education!)
TF1 and M6 are selling their stakes in French streaming service Salto. That will leave Salto without two of its three parent companies.
Morgan Stanley launched a $1 billion private equity fund focused on decarbonization.
🤪 Twitter saga in Europe
Twitter confirms 140 redundancies in Ireland.
Twitter has disbanded its entire Brussels office, sparking concerns among EU officials
Senior Twitter executive secures High Court injunction in Ireland.
Twitter France's head: c’est fini.
🏃♂️ On the move:
H.I.G. Capital hired three London-based professionals for its capital formation group: Daniel Rosenthal Ayash (ex-Eaton Partners) as a managing director, Bernice Berschader (ex-Castlelake) as a principal and Micael Hagelin (ex-New End Associates) as a managing director.
Squire Patton Boggs has hired private equity and M&A lawyer Carlos Blanco Morillo as a partner in Madrid.
Carlyle has announced 32 new partners and 39 new managing directors.
🗣️ Cheat sheets:
ICYMI: super founders of Europe.
Interesting startups: climate-focused, marketplaces, cybersecurity, web3.
Good to know basis
👉 Building investor signals for a pre-seed startup - some basic rules.
🤔 The mental mapping of a startup opportunity - simple terms
👍 Great VCs are hard to find - Romanians rock
✴️ Why no-one will steal your great start-up idea - duh
ℹ️ A guide to German VC for foreign investors - the nightmare explained.
📱 Consumer apps trends - algo-driven, generative AI, video eats the world. link
💲 Building product at Pitch - useful
Have you produced useful resources for the community? They can be events, reports or tools - send me an email with submissions at drnovac@gmail.com
Reality checks
🙈 Switzerland vs Sweden - the difference between the two in the startup world is that people in Sweden speak English. (English is the tech startups language in case you live under a rock. Or in France or Germany. :P).
🔀 It’s just business - investors and startup people have a transactional relationship, the Slush edition.
🤑 Re-warming the clone-the Silicon Valley-soup - UK Chancellor’s plan to turn UK into the next Silicon Valley.
❄️ Winter is here - Fabrice says he has not been this bearish since 2006 and the post crash VC market isn’t a temporary blip that will swiftly trend-back up in a V-shaped recovery of valuations.
🤔 Sequoia had done careful due diligence on FTX and yet it lost $200 million on it. Otoh, every VC has a quiet story of fraud in their portfolio.
🎯 FTX dunks everywhere - Bain was among consulting firms that helped conduct due diligence for Tiger Global’s $38 million FTX investment stake.
🖖 Doing business with Pitchbook - it’s not only that their data is bad, but they’re also hard to do business with.
🥡 Remains of the day - taking a long term view of Web3
Closing notes
🔥 UK restaurants are going bust at a faster rate than during the Covid crisis. Here’s some findings based on data scraped from all 90k restaurants in the UK on the Just Eat, Uber Eats, and Takeaway apps:
only 3% of restaurants were listed on all 3 apps. 75% of restaurants only list on a *single* app.
Just Eat is clearly the market leader, w/ 50% market share, except in London.
Deliveroo is most differentiated with its London dominance, affluent skew and lower dependance on chained QSRs and grocery, while Just Eat and Uber Eats are more similar in every other part of the UK.
🎄 Euro Xmas markets - Berlin, Strasbourg, Vienna, Düsseldorf
🤔 What do Americans get wrong about Britain?
🇨🇳 Chinese children’s addiction to gaming resolved
👺 Tumblr users have concocted a fake movie by Martin Scorsese and it's remarkably, eerily convincing.
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