AIN asked Ivan Petrenko, the Angel One Fund Managing Partner and CfE Accelerator Executive Director, about the launch of his new fund, its startup preferences, and the average “temperature of the market.”

Let’s begin with the changes the venture, angel investment, and startup world has undergone compared to 2023 or 2022.

We all know each other in the industry. Some love to sound super positive. I prefer to sound realistic so that I can understand where the bottom is and how to get out.

Many say that we, Ukraine, are almost the leading startup development market in Eastern Europe. Hearing this, I have a bitter smile because I don’t see such a trend. This year, however, the situation became smoother thanks to grant programs, such as Google for Startups, IT Consortium, Seeds of Bravery, etc.

In my opinion, it is one of the two essential conditions needed for new startups to arise. Their teams need money. And it is grant funds for the first time. Before the full-scale invasion, USF granted $25-50k per applicant, and it was a significant boost for the industry. In 2022, they stopped doing this, resulting in a quick shrinking of the industry. It was one of the reasons.

Nowadays, new grant programs work in Ukraine, and some old ones are back, too. It’s a perfect chance for startups to give it another try. I think there will be more of them in six months.

I presume everybody is now looking at Defense Tech.

Not everybody. It is our bubble where all eyes are on deftech.

However, it is a very restrained domain most ventures would rather avoid because they are not allowed to invest in it. For example, we at Angel One may not directly invest in Defense Tech.

Is it because of your internal policy?

It’s not entirely about our policy. Legally, we are a US-based fund with several regulatory restrictions, so we cannot invest in Defense Tech. Otherwise, we would lose our investors. So, at the early stage, by establishing a fund, you should discuss [with partners] whether it will invest in the defense domain.

And there is a very thin line — dual use, deftech, and lethal weapons next. Those are three very different things you must be careful with. The same discussions we have in Ukraine. It’s obvious why. So, we often have to work with targeted deftech investments. There is no such bubble abroad. However, many players look at Ukraine carefully and pay more and more attention.

The funds that can invest are very familiar with the required information. Their analysts gather all the data about the current situation in Ukraine. They select projects with great caution because the funds must report to institutional or private investors.

Many things depend on Ukraine. And a lot of things are done. But a long way is still ahead. Anyway, when we invest in Defense Tech, we expect that their team and legal entity are based and registered somewhere in Delaware, as well as their technology, to enjoy protection according to the local legislation.

We do care that a deftech startup keeps thinking about sales not exclusively in Ukraine. The team should plan their international activities in advance. That’s why production or development is often located outside of Ukraine, which means a different market and an adapted business model.

The most recent investment of Angel One Fund in six startups was a syndicate deal with private investors, wasn’t it?

Yes. The same investors we had at Angel One.

So it was the Angel One syndicate member, right?

Mostly yes. Now, we are working on the launch of a Defense Tech fund. Hopefully, it will happen between September and October. We need an official opening to invest in defense startups not only through syndicate deals but also as a fund because there are interested investors who want to join not our syndicate, but the fund directly.

So, are there a bunch of investors committed to a new fund?

Yes, there is a particular sum. We may speak about a $1.5-million commitment. We are working on its institutionalization to run deftech investments as a fund.

Until there is no fund, we keep searching for teams and invest via syndicate deals.

Do you have a plan with your targets for this new fund? Which startups would it be?

We don’t care if it’s a hardware or software project. Software is always more attractive due to its better scalability, safety, and lower need for investment. However, I am not sure about the last one.

It is highly unlikely that it will be pre-seed rounds since fewer and fewer investors desire to enter at this stage, where you cannot check the actual demand and sales of a product. So, mostly, it will be very early seed and maybe late pre-seed rounds with a well-tested working prototype and pre-orders.

OK. Let’s return to the Angel One Fund. It currently has $1.5 million, right?

We have already got $2.5 million.

How many projects do you plan to invest in until the end of the year?

Recently, we confirmed our fifth investment. Hopefully, it should be three more until the end of the year. We wouldn’t reach more for certain, because we have another deftech focus with five more investments this year.

Are you going to close to close the fund in 2025, or not?

No, we will keep raising. So, the fund will keep working. It will be a nonstop process. We decided in favor of a rolling fund that will be constantly filled.

Speaking of your syndicate deals, we had a conversation with Dmytro Vartanian (SID Ventures) recently. Can you tell us about the platform you use to close deals? Do you use any technological platforms?

At the moment, we don’t use any. All prefer SAFE or Convertible Loans. It’s a universal tool with more than enough functions.

With the investments in six startups, you also announced that you will support them. What will it look like?

We are only learning. The fund is new and small. We don’t have any military expertise yet, so we cannot provide it. But we do have good business expertise thanks to our network of private investors, primarily US-based. They have good contacts.

We also can help with sales. If a startup team is interested in entering the US market, we undertake the work with contacts, which we get from our private investors.

Which domains are the market’s top priority?

It is AI, for sure.

I also hear a lot about EdTech.

First, we declared at least 30% of deals in EdTech would be a target. But so far, we haven’t made a single deal. SAS remains one of the simplest and most popular models as always. MedTech and BioTech are growing fast. There are vast investments and technologies quickly grow.

I think EdTech is less popular. It was three to five years ago, especially during the COVID pandemic, but the MedTech, BioTech, and FinTech development is very impressive. And there is, for sure, AI constantly added to different products.  Finally, people have the idea that AI is not a product but a tool. You should learn how to use it to create added value for your product.

Did the startup average ticket and entry terms change for Angel One during the full-scale war? What are the startup rounds you are looking for?

The average ticket didn’t change and remains about $150,000. The terms, more or less, are the same. In any case, we realized we are not a pre-seed fund, as we declared once. After all, we became a seed fund. Our team seeks products with customer feedback and dynamic sales. So, we are cautious by investing in startups without sales.

This requirement is a must now, and our investment committee doesn’t want to speak with teams that don’t generate sales. The only exception here could be some real innovations, such as quantum computers. But not so many startups work with them. OK, there is Haiqu, but our fund arose too late when they already had raised everything they ever wanted. This startup was, for sure, the one we would be very interested in investing in.

So, they must show some traction and a clear sales strategy. It is one of the weaknesses, particularly of Ukrainian teams.

And which of the Angel One Fund investments is the fastest-growing one?

Our first investment, Zeely, is showing the best results so far. They grow very well. I understand that the estimated value is a theoretical indicator because there can be any number until somebody puts a money bag on the table. Nevertheless, they attracted new investments and tripled in size for the past year. It is a very substantial indicator.

Another example is GO TO-U. Their sales are growing each month, maybe not so fast as at Zeely, but they do. They also entered the USA market and made several potentially good deals, including one with Siemens. We expect their mighty growth about the end of this year.

You are also starting a new IdeasLab program. What are the terms? Are there any changes compared to previous times?

There are no specific changes except for the constant improvement of the CfE Accelerator program. The program aims to support student teams in a hybrid format for free. Our main goal was and remains to let students try to launch a product, make their first mistakes, etc.

We decided to create our own learning program for future startupers where the students can get essential skills and apply them in practice by doing everything on their own. IdeasLab’s other goal is to allow students to do everything within three months. It is the only university program in Ukraine providing student teams not only with knowledge but also workspace and grants up to UAH 200.000 at the idea validation stage. Now, we have over 100 mentors, the founders of Ukrainian and foreign startups, who spend their time teaching the students. Among them are the founders of SoftServe, Angel One, LvBS, Netflix, Microsoft, TedxLviv, AiSDR, The Gradient, QubStudio, Kormotex, Tickets.ua, Harmix, Medallion, etc.

We already have $1 million in so-called credits from different companies, such as Grammarly, Salesforce, and Notion. We teach students how to use it. More applications are expected this year than in the past year.

About RobosizeME

• Founded in 2022 with headquarters in Czechia and the US, RobosizeME is a process automation specialist for the global hospitality industry. The company leverages extensive industry knowledge and technical expertise to help hotel chains and large hospitality management companies enhance efficiencies in all areas of hotel operations.
• Its “digital workers” have already been introduced to multiple reputable hotel chains and hotel management companies, including Kempinski Hotels and Resorts, Louvre Hotels Group, Global Hotel Alliance, Design Hotels, Dorchester Collection, H World Hotels, MCR Hotels, Story Hospitality, and many more.

Investment details

Although the deal’s amount is undisclosed, it follows the two-week announcement of BrightCap’s successor Fund II. Earlier, AIN reported on the fund’s first close of the €60 million target. The fund’s ticket size was stated to range between €400,000 and €3 million. Thus, the investment in RobosizeME is expected to be at least €400,000.

“This is the second time we are backing visionary founder Stephen Burke, following our Fund I investment in Kardi AI—a medical-grade long-term ECG heart monitoring startup. Stephen’s track record in the hospitality technology sector spans over 22 years and includes a successful previous exit. This time, he is teaming up with co-founders Linda Girrbach, a seasoned hospitality and revenue management expert, and Ivo Brabec, a CFO and finance entrepreneur,”

BrightCap’s representatives commented on the deal.

Apart from the lead investor BrightCap, other investors in this round include hospitality-focused Czech – Indonesian newly forming Botanique Hospitality Management Group.

The fresh capital will enable the RobosizeME to grow and reach the milestone of signing 6,000 hotels within 18 months.

About Phyron

• Founded in 2019, Swedish video tech pioneer Phyron is developing the world’s first fully automated AI-enhanced video solution. Using Artificial Intelligence, the software identifies the best and most relevant selling points of each individual car and combines still images from a data feed, facts and figures about the car, brand imagery and retailer services into relevant, highly effective videos.

• Phyron currently counts over 3,000 car dealers as customers across 30 countries. Just last month the company set up new offices in Brighton, UK, in addition to its existing HQ in Stockholm, Sweden.

Investment details

Round2 Capital provided both an additional revenue-based financing investment as well as an equity investment as part of the company’s Series B. The automotive retail giant Peter Vardy and existing shareholders also joined the funding round.

“Since we met the Phyron team and decided to make our first investment, the company’s development has been very positive. We value the relationship we have built and look forward to supporting the next phase of the company’s growth. We believe that Phyron is planning the right next steps to take advantage of opportunities in a dynamic market environment,”

Jan Hillered, co-founder and managing partner of Round2 Capital, commented on the investment.

This is not the first time the fund invested in the company. In June 2023, Round2 made an undisclosed seven-figure investment in the Stockholm-based AI-powered video content creation platform. At the time, the investment was directed towards technology development and team growth.

The Series B funding will enable Phyron to accelerate development of its AI and automation technology, grow the team with top industry talent, and expand its operations in new markets – namely the United States.

• Steep is a Swedish startup aiming to simplify analytics work. It was founded in 2021 by Johan Baltzar and Nino Höglund, former leaders in Analytics and Design at Spotify, iZettle, PayPal, and Kry.
• Steep enables a few data experts to serve a large organization effectively, facilitating self-service among all users and promoting real-life collaboration within teams. This approach allows users at all levels to engage with metrics, discuss changes, and align on a unified view of the business, making data analysis more accessible and efficient across the organization.

Steep has already made a big impact at Voi. Using metrics instead of dashboards is definitely a mindset shift, but the benefits are worth it. It’s helping all our users to do much more on their own and allows our data team to work smarter and move faster,

Magnus Dahlbäck, Sr Director in Voi, which is already using Steep, said about the startup.

• The fresh round was co-led by the London-based VC firm Connect Ventures, investing in product-led companies in Europe at seed stages in consumer, health, fintech, SaaS fields, and Inventure, an early-stage VC with over 90 companies from deep tech to consumer internet brands, across Nordics and Baltics, with offices in Helsinki and Stockholm.
• Nordic Alliance VC, a Singapore-based Antler, and Greens also joined the investment round.

This new funding will be used to accelerate product development, expand the team and reach more companies globally. The startup also announced the beta release of Steep’s new AI-enabled interface.

Investments details

1. The first investment of the fund was in May, backing the Czech energy company Delta Green that develops technologies and software solutions to make flexible electricity consumption accessible to households, promote renewable sources, and reduce emissions from power plant operations. The company planned to use the total investment of €2.2 million for further growth, expansion into Western Europe, and completion of software that will open the way for households to earn through grid balancing.

2. The second investment from Purple Ventures went to iVent Pro. The British startup offers a cloud system for managing virtual and hybrid conferences for universities, companies, and the public sector.

iVent Pro has effectively captured customer requirements in the post-COVID era and has an excellent product for online and hybrid event organizers. It offers the ability to create unlimited events, thereby reducing overall event costs. We invested in a team with vast experience in this field and look forward to seeing where they can take the product,

Jan Davídek, general partner at Purple Ventures, commented.

3. And the third investment from Purple Ventures was directed into a yet undisclosed company developing a SaaS system for modern HR management. The total value of the investment in iVent Pro and the new HR solution amounts to €1.25 million.

About Purple Ventures

Purple Group, now operating under the name Purple Holding, began forming in 2007 under the wings of co-founders David Kašper, Jakub Nytra, and Filip Řehoř. Purple Ventures’ Fund I was launched in 2018 by Jan Staněk. Currently, its total funding amount is €15 million. Purple Ventures is focused on backing startups in the pre-seed and seed stage. The fund has supported over twenty companies in six years.

In March 2024, Purple Ventures launched its second fund, total amounting of €40 million. It focuses on startups from the CEE region with teams in the EU, with the ticket size ranging from €250,000 to €750,000.

About KAYA VC

• KAYA VC manages over $300 million in assets across 4 funds. KAYA co-invests and partners with funds like the British-American Index Ventures, European Creandum, EQT, and US-European Goldman Sachs. Their advisory network includes founders like Tomáš Čupr of Rohlík, as well as Juraj Masár and Veronika Koleják of Better Stack.

• Since the launch, it has more than forty companies in its portfolio, with the value of their shares reaching €300 million. KAYA’s portfolio includes two unicorns: the Czech online grocer, Rohlík, and the Polish Docplanner, a global platform managing healthcare practices and scheduling.

We support big dreams and ambitious plans. We help create the best conditions possible for our entrepreneurs, enabling them to overcome challenges more easily. We connect them with other successful entrepreneurs for advice and back their belief that the Central European Region is a fertile ground for building global companies that can win in their respective markets,

Tomáš Obrtáč, one of four equal partners in the fund, says.

More on the Fifth Fund launch

Now, the firm is preparing to launch its fifth private investment fund, which will have 80 million at its disposal.

KAYA expects their investor composition for their fifth fund to be similar to the previous one, where the majority of finances came from institutional investors and about three-quarters of the capital originated from the private sector. The minimum investment in KAYA is expected to be €1 million.

The fund also added that it does not specialize in a specific segment, category, or mission of startups. But KAYA aims to invest primarily in Czech, Slovak, and Polish companies.

• According to Ivan Petrenko, managing partner of Angel One, the fund cannot invest directly in defense technology startups due to internal policies, so it acts as an intermediary between private investors who are looking for and want to invest in Ukrainian defense technology and such startups.
• The fund’s team searches and evaluates startups, communicates with potentially interested investors, and continues to support these startups after agreements are signed, Petrenko said.

He also added that Angel One Fund recently raised a new round of investments in the amount of $1 million. The collected amount was put to investment from the start of June 2024. As before, the fund will act as a generalist fund, looking for Ukrainian startups in the pre-seed and seed stages from all industries.

Who received investments?

Startups that have received investments include Swarmer, Mantis Analytics, and Buntar Aerospace.

• Swarmer transforms drone swarm operations, making them more efficient and effective. Swarmer revolutionizes the use of drones through AI-based technologies, including swarm management software, a combat mission control center, and AI co-pilot technology. Swarmer’s vision is to create a system that enables humans to autonomously operate swarms of drones, supporting military operations while minimizing human risk in the most challenging environments. The startup was founded in May 2023 by Serhiy Kuprienko and Alex Fink.
• Mantis Analytics helps organizations identify real-time risks and drive growth with AI. The AI platform provides situational awareness of corporate assets, ensuring their protection and rapid response to crises. The founding team consists of CEO Maksym Tereshchenko, technical director and ML and big data expert Ostap Vykhopnyi, and industry expert Anton Tarasiuk.
• Buntar Aerospace is a Ukrainian defense startup that develops the Buntar One reconnaissance air defense system and Buntar Copilot — software for planning and execution of reconnaissance missions. Founded in August 2023 by Ivan Kaunov, Kateryna Bezsudna, and Bohdan Sas. The team focused on the problem of damage and loss of UAVs during reconnaissance missions and developed a complex solution that includes separate software and hardware products.

About Angel One Fund

Angel One Fund is an angel venture fund that invests in Ukrainian startups and helps develop the startup culture in Ukraine. The fund provides startup capital at the pre-seed and seed stages for scaling startups based on technologies, innovations, and intellectual property developed by Ukrainian founders.

Angel One was created in 2022 by the Ukrainian Catholic University Foundation, with an equity capital of $1.5 million and is currently continuing a fundraising campaign.

Dmytro Dubrovskyi talked with the Editor-in-Chief of AIN.UA about how the fund will operate and where and how much they are planning to invest.

Dmytro, not long before our conversation, you have released a statement about Uklon Co-Founders’ first big-check investment in a defense tech startup called Buntar Aerospace. Can you share some details of this deal with us?

We have invested $200,000 in a seed round. The startup produces vertical take-off and landing surveillance UAVs that can fly for 60 km and intelligence-mission planning and operating software that automates a UAV operator’s planning effort by 90%. They are currently being tested on a training ground and soon will be their first combat use.

If I am not mistaken, was it your first external investment as Uklon Co-Founders? Or did you mean Defense Tech?

We didn’t invest in external companies, but this year, we decided to open such a track and raise $2 million within our fund for defense tech development in Ukraine. The average check is $200,000 to $500,000. We are interested in startups during seed rounds. Now, we plan to get 8 to 10 companies in our portfolio.

Are you going to invest in non-military startups as well?

Not now. We have a clear goal at the moment.

Have you used private funds for this foundation, or did you also invite some external investors?

It was only private funds of co-founders from Uklon dividends. We invested in the foundation according to our company shares.

Buntar Aerospace was only the first company in our portfolio. Now, we consider another ten projects that passed due diligence.

What requirements do you have for defense tech startups? Do you prefer software or hardware projects? How important is having the BRAVE1 status?

Having the BRAVE1 status is very useful. We also expect that a startup will raise an intelligence component. So, it should not be limited to FPV assembly of Chinese parts supplied by the state or volunteers.

We look for unique tech advantages. That’s why we consider hardware plus software. We also appreciate when startup products have already passed a testing stage and are prepared for combat use so that we can receive feedback from military units. And the third point is secure sales.

In any case, we also study the project team. We check whether there is a legal structure, the financial statements are clear, etc. If not, we can consult them on optimizing these processes.

Do you participate in product development elsewhere than in consulting and financial support? Maybe you share your expertise in sales or development?

For sure, we can share our expertise. We might give a hand of help in marketing, sales, and back-end development. In addition, we have a long list of contacts, including deftech developers, military, and volunteers. We can aid with testing, getting feedback, and developing the product. However, we are investors in the first place, so finance is our primary contribution.

Do you seek advice from the Ministry of Defense or the General Staff regarding startups you would invest in?

We have no ties with higher military command, but we may always request feedback from some famous volunteer funds and formations involved in testing.

We have friends in the Ministry of Defense and Special Forces, too. So, a lot of feedback flows to us from different sources.

Let’s speak about Uklon. Recently, you have exited Azerbaijan. Did it change your expansion plans somehow? Which markets are you going to enter next?

In one way or another, the war influences our plans. Indeed, the joint co-founder’s investment in defense tech is of value from the perspective of emotions and national consciousness powered by a desire to invest in Ukraine’s victory. Expanding into new markets became a bit complicated for our product.

We don’t cancel any of our plans, but there is no need to rush. We are developing Uzbekistan and successfully pushing a Russian competitor from the stage there.

Indeed, we have left Azerbaijan due to a tense situation with unpredictable legislation changes. Our local partner also decided to cease investing in this country.

Recently, Uklon joined the Diia City special taxation mode, and it was relatively late compared to other product companies. How satisfied do you feel about it? What benefits and underwater stones do you see?

Actually, we like it very much. We also joined the Diia City United Association, which aims to preserve the rules of this unique space.

Can you comment on the consequences of the newest claims anonymous Telegram channels published against Uklon? Did you find out what and in whose interest has it been done?

Most likely, in the interest of exacting money. One day, we just decided not to dig deep into that kind of pretty typical media attacks, which became more and more usual, unfortunately. You can see both businesses and politicians attacked. Sometimes, such media activities are accompanied by law enforcement bodies’ actions. Now, we are focused on building a defense strategy for the event of new attacks.

Do you participate in side projects besides the Uklon ecosystem?

I am involved in the Defense Builder Accelerator as a mentor. We will share our experiences with startups so that they are ready to comply with our investor requirements.

Speaking of GR as one of the Diia City United Association’s functions, a member of which you are, what would be the most painful problems Ukrainian businesses face nowadays, in your opinion, as the ecosystem member? Is the government attentive to your concerns?

For instance, there are ongoing discussions about the necessity of employee reservation from the mobilization. In particular, Oleg Gorokhovsky, Co-Founder of monobank, posted on this topic on Facebook. What do you think about this?

For sure, employee reservation and a more transparent mobilization procedure are the things the businesses are lacking. There must be an option to reserve key employees at least to keep the company working. I like the concept of employee reservation by MP Dmytro Natalukha.

I understand that such a decision would be unpopular among our people, but our country really needs it. Hopefully, the government will act in favor of this instead of only raising taxes. It looks simple on the first look. However, many don’t see that the economy would shrink without employee reservation, and the businesses would not survive, especially by having to react to all those blackouts.

Should we meet again in a year; what news would you like to share with me? What strategic goals do you want to achieve?

I dream that Ukraine would be victorious then, and defense tech startups supported by us would grow into big companies and unicorns. The whole world saw the aggression of an autocracy and its imperial ambitions. So, NATO member states and other democracies have to invest more in the defense industry.

I also would like to speak with you about new markets Uklon entered as a truly international company.

About Ruta.vc

• The fund’s team includes two people: Dmytro Bondarenko, the general partner of Ruta.vc, who is also the general director of the LIGA group of companies, and Olena Pshenychna, the managing partner, an entrepreneur, and business angel.

During my active career as an investor and entrepreneur, I saw the number of requests to the market in sports technology. And this is an incredible amount. I saw what a voluminous ecosystem can be built. Due to the large number of international connections, there is an opportunity to help our projects reach the international level,

Dmytro Bondarenko, the fund’s general partner, said.

• The fund will focus on software and hardware projects at the pre-seed and seed stages, that is, already showing sales. Partners of the fund will also provide mentoring and incubation assistance.
• Ruta’s team didn’t disclose specific check amounts. According to its website, $22 million was invested in sport tech across nine projects.

The sport technologies sphere is not only fitness applications with a virtual trainer or gadgets. These are sports business management, augmented reality, Esports, statistics for sports and working with data. The trend is growing in the world. In 2023 year, 34 new funds were launched. And we want to be the guide that will help Ukrainian startups enter international markets and be a solid platform for them,

Olena Pshenychna commented.

AIN had a great opportunity to talk with Inka Mero, founder at Voima Ventures, about the fund’s recent activities, successes and challenges, as well as discuss the state of the Nordic and Baltic markets.

Tell us more about Voima Ventures.

We are a leading deep tech venture capital firm based in Helsinki, Finland & Stockholm, Sweden, specializing in science-based investments. We were founded in 2019 by (Mrs) Inka Mero, a seasoned and well-known angel and serial entrepreneur in the Nordics. Partners include Jussi Sainiemi, Pontus Stråhlman and Investment Director Jenny Engerfelt, as well as Niko Elers who is our investment manager.

Voima Ventures is driven by a mission to support visionary entrepreneurs working on breakthrough technologies that have the potential to solve global challenges and create significant societal impact. To this end, our latest Fund III is Article 8 compliant, and offers transparency into the environmental impacts of all our investments.

Our investment strategy revolves around backing early-stage startups with cutting-edge science and technologies, global markets, and scalable business models. We find the rare companies that leverage deep technology, usually developed out of years of university research, that address pressing societal and environmental challenges — solutions for the people, planet, and industry — while also demonstrating a strong market potential and a clear path to commercialization.

We currently have close to €200 million in assets under management, with a total of 37 companies in our Portfolio, across three funds.

Let’s talk about numbers. Voima Ventures is turning 5 this year. Can you walk us through the investment deals you consider the most successful throughout those years?

Fund II:

• Kuva Space, €17 million seed round for hyperspectral nanosatellite constellation. 
• Enifer Bio, over €15 million Series A for sidestream-based protein production
• Genomill Health, next gen liquid biopsy technology.

Fund I:

• Solar Foods, feeding HO2 to bacteria to generate novel food
• Infinited Fibre Company, 100% eternal fashion fibre from recycled clothes.Backed  by top global fashion companies.  
• Dispelix, the only independent waveguide player in the AR / VR space. 
• Exits: Focalspec, Minima, and Paptic.

It’s almost a year since the launch of Fund III capped at €120 million. In terms of investment deals and received financing, how many of your plans have been achieved so far?

On average we review and assess approximately 800-1000 cases from the funnel on a yearly basis. 

In March 2024, Sooma Medical announced its €5 million investment round where Voima was the lead investor. How did the deal come to happen and what can you tell us about the startup?

We met with the founding team back on summer 06/2023.

Sooma Medical is a spark of hope for the mental healthcare sector. They have pioneered an innovative solution that will change the lives of individuals battling depression and chronic pain. Founded on a mission of compassion and driven by a commitment to scientific rigour, Sooma’s groundbreaking therapies offer drug free, effective, and non-invasive alternatives to traditional treatments. 

Through the use of neuromodulation, Sooma is alleviating symptoms and restoring hope and vitality to those with mental health challenges. Backed by research, Sooma is set to push the industry benchmarks of this healthcare sector North.

As we know, in September last year, you launched Velocity offering €1 million to science-oriented startups. N-ink managed to win the challenge. How did the challenge go and do you have any plans for “Velocity 2”?

The Velocity Challenge exceeded all our expectations, both in terms of the quality and quantity of applicants we received (83 to be exact!). The event garnered widespread positive feedback from co-investors within our network and sparked numerous fruitful discussions with finalists. While organizing an event of this scale required significant internal resources, it also generated an extraordinary amount of unique deal flow opportunities, we had finalists who were not on the radars of any of the other VC’s at the event. 

This is validation that our deal flow strategy is on point and the relationships we have cultivated with Universities across our region are paying off. As a result, discussions about Velocity 2 have already commenced internally, with a tentative plan for a second round slated for an undecided date in 2025. This year, our focus remains razor-sharp: to seek out and support early-stage Nordic and Baltic companies poised to make meaningful contributions to society, the environment, or industry.

In our 2022 ranking, we included Voima Ventures as one of the most active funds in the Nordics and Baltics. You surely must know a thing or two about these markets. Can you comment a little about the current investment climate in the region.

Finland has laid a solid foundation for financing domestic startups through years of concerted effort, which has been crucial in light of the significant decrease in foreign capital. In response to the tightening market, startups have also taken proactive measures to enhance capital efficiency,

Jussi Sainiemi, Deputy Managing Partner of the venture capital firm Voima Ventures and Chair of FVCA’s Venture Capital Committee, comments.

Many investors are talking about tough times for the market in recent years. Did you experience any difficulties in 2022-2023 and how did you overcome them?

Looking back, we all know the numbers: there was a massive drop from the top years of venture capital investments from 21 to 23. The decrease in venture capital investment volume in the Nordics and Baltics — that’s our home turf — was close to 50%. So, the top year of 2021 was roughly €19 billion and the last year was only around €9 billion. 

What does it mean? Firstly, one of the successes which we recently had was the first closing of Fund III. We were able to raise a fund above our initial target within really tough times. I think we managed to overcome the difficulties by building a unique positioning for Voima Ventures. In this challenging landscape, we are one of the very few science-centric investors with a proven track record from our Fund I and II. The team had grown from Finland to Sweden, so we’re really covering the Nordics and Baltics. And then we also did a very specific thesis-based investment strategy on three core areas we invest in: green transformation, exponential health solution, and game-changing platform technology. 

In short, we managed to overcome such difficulties by doing very thorough work. Then let’s also remember that the work for Fund III had started already when we launched Fund II. So many of the new investors who came along were the LPs we started talking to five years ago. So it’s very long-term work.

Now, how did the fundraising difficulties affect our companies? So, the companies that have been in their later fundraising stages, Series A, B or C — anything from €5 to €10 million or above obviously struggled. So I don’t think any company had an easy time fundraising. And each of the more mature companies that have been in this phase, have been solving those problems very individually. 

Some of them have been focusing more on customer traction, really driving revenues because investors really value revenues. Others may have been also, let’s say, cutting the burn in order to have just more runway to survive through the tougher times, particularly the ones who are in the R&D mode. And that’s obviously a smart thing to do. Thirdly, of course, the most successful companies were raising big rounds, but it just took them longer. So we’ve had a lot of value growth optics in our portfolio. And I think the good lesson learned for any entrepreneur is that even in tough times, you can raise big rounds if you are even more focused. And then, of course, we’ve had some companies that have gone belly up, particularly the ones that come from the Fund I, older vintage companies. 

Sometimes it’s good to have these disruption points like COVID or this financial crisis, following the inflation and the war. As for us, we work with deep tech companies, with 90% of them having some actual concrete innovation, like a diagnostic kit or a factory to generate next generation protein, or a satellite for the next generation of surveillance. All these companies had to go through different challenges than, say, B2B and Travel tech companies. In that respect, our companies were better positioned for this financial crisis. They already knew how to cut burn and focus on customers, going straight ahead with this thesis that the companies need to have a 24 month runway. And that’s why we’ve done better. 

Of course, the 100 million rounds have been non-existent in the Nordics. Only this quarter we’ve started to see a bit more of a positive development in the market. Time will tell how the whole market will evolve from this altogether.

Can you share any predictions about the close future of Startup and VC ecosystem in the CEE region and the Nordics? What should we expect?

Let’s remember these big megatrends are not disappearing anywhere:

• Firstly, we have a massive planetarian crisis. We will see different weather disruptions due to climate change, declining biodiversity, and things like that. But we are also seeing a massive shift, in the B2B side, from the industry to climate neutrality. This will create great opportunities for a lot of science-based and deep tech companies. However, it’s critical to get into scalability, as well as similar cost and pricing to existing solutions. The scalability is becoming really essential, and also the cost of capital. 
• The other megatrend, of course, is exponential technology development: this competition between Asia, Europe, and the US, whether it’s AI or fundamental technologies like semiconductors, optics, photonics, etc. National interests are driving a lot of change in these matters. We see a lot of subsidies even within Europe for technology-intensive core technologies. Doubling down here on the single European market would be really critical. I think it will benefit everyone if we have more semiconductors, optics, photonics, and even dual-tech production in Europe.

Dual-tech, in particular, I think is the only silver lining of this war, if there’s any. Europe will start to invest more into dual-tech, which is a foundation of many consumer and B2B technologies we’re using today. And we shouldn’t shy away from that. We need to be independent in our defence technologies in Europe,

Inka Mero says.

• And then, on these other megatrends, which are now happening, like ageing population, urbanisation, and then, of course, the accelerating pace of the disruptions and the changes — offer a huge room for opportunities. The challenges that the European countries have are more systemic, relating to our innovation ecosystem or our demographics. But I think we have a really solid foundation on these opportunities.

Say, a startup is eager to raise fresh capital from Voima Ventures. What is the best advice you can give the founders?

When seeking funding from Voima Ventures, founders should focus on clearly articulating your startup’s value proposition and aligning it with our investment thesis. 

• We back Nordic-Baltic deep tech startups who are building companies with a societal and environmental impact.
• While the technical complexity of your solution may be difficult to convey, it’s crucial to emphasise the scalability, potential impact, and your team’s expertise on the issue you are trying to solve instead of focusing on the granular details. 
• Prepare a well-defined business plan, outlining your growth strategies, and demonstrate a solid grasp of your market and competitors. 
• Highlight your commitment to innovation, sustainability or societal impact, and remain open to feedback throughout the process. 

As specialists in deeptech investments, we bring extensive expertise in areas like cleantech, life sciences, advanced materials, quantum, and AI. This enables us to offer strategic guidance and valuable network connections tailored to startups in these sectors.

And, in conclusion, do you have any future plans you would like to share with our readers?

• We’re planning to expand our presence in Norway and Denmark, and continue to build our operations in Sweden through recruitment of a Life Sciences Investment Director.
• Double down on our efforts to connect with universities conducting cutting edge research into new technologies.
• Continue to advocate for greater boardroom diversity with our Annual Women to Board initiative, as well as fostering female representation in the STEM fields through proactive investments in female founded Science companies.

AIN had the opportunity to interview Denis and Viktor Gurskyi, brothers and co-founders of 1991 Ventures, discussing the fund’s activities in 2023 and plans for 2024, as well as talking about the CEE and Ukrainian markets.

Tell us about 1991 Ventures. What specific sectors or industries do you focus on and why?

We’re a sector-agnostic fund, incorporating priority and interesting areas into the fund’s strategy. 1991 Ventures has a significant historically accumulated experience.

Historically, 1991 began as an open data project. So, we deeply understand Government API and government services, as well as civiс tech. Among 1991 graduates, many companies have built their entire business on open data. Among them are Opendatabot, YouControl, Штрафи.ua. And as open data very quickly becomes big data, we also understand the specifics of working with big data projects with databases and arrays, and how various services are built on that. 

Then we worked a lot with fintechs: with MasterCard, Visa, the National Bank of Ukraine. 1991 supported various projects like platforms in areas of digital health, transportation mobility, clean energy. Accordingly, all these sectors can now be linked to AI+. However, we believe that AI is a superstructure over all industries, rather than a separate industry, as it permeates all industries.

We also understand the specifics of working with B2B, B2G sectors.

We believe that this question is not about which industry the startup comes from, but what added value the fund can offer. Today there are no problems with fundraising capital for any company with an interesting model.

You also emphasize supporting companies and startups that adhere to ESG standards and sustainable development goals. What is the mission and core values of 1991 Ventures?

We believe that the fund should provide, in addition to investments, a certain value. That’s why we don’t want to work with companies that the fund will only invest in and then watch how they are doing. We want to be a part of companies’ growth.

For example, we use our global network of contacts at the corporate, government, and international levels to match companies for further mentoring, partnership etc. If a startup deals with disinformation, we’ll gladly introduce them, for example, to NATO. If it’s a company offering corporate software, we’ll introduce them to Meta, Microsoft, or Google.

Tell us more about the fund’s creation process.

I think it’s better to call the fund not newly created but gained. Because its formation took a long time, which is quite rare for a fund mandated to work with founders from Ukraine. 1991 is an FCA regulated fund, structured in Ukraine. I remember when we were at the Web Summit in November 2022, and then, we already knew we had commitments to the fund. Then the structuring process took almost a whole year.

In the summer of 2023 during Ukrainian Recovery Conference and London Tech Week, we obtained the license. By that time, we had already set up all the documents, and the fund came into force in 2024.

And now, at the beginning of this year, we were able to announce it without any legal issues for us.

You did not announce any investments yet, but said about plans to invest in early stage companies. Tell us how you deal with the difficulties that arise at such stages?

Yes, there are no investments yet. Why not? Because the whole process is still being structured. It’s quite a large and complex historical process. It’s a full-time job for more than a year.

During the work on the fund, many people already knew about it, and we had many private meetings where we talked about future prospects and potential portfolio companies. This helped us build a network of co-investors, those who can invest after us, and those who invest at later stages. This also allows us to understand what form of fundraising to choose.

We believe that this is an important strategy to make such connections. For example, the UK-Ukraine Tech Bridge, an initiative of the British and Ukrainian governments, where an agreement was signed, and our team helped in its investment accelerator. As part of this initiative, 20 companies from Ukraine were selected to be mentored by British investors and will be showcased at London Tech Week.

In addition, it is worth noting that we collaborate not only with funds but also with various ecosystem organizations from Ukraine, such as the Ukrainian Startup Fund.

As for our stage-focus early stages, our fund focuses on investments in the amount of €200,000-€400,000. For the European market, these are small amounts, but if we talk about CEE, this is not an idea-stage startup, but already a startup with a valuation, probably of at least €3-5 million. And this means that this startup already has some validation from clients and organizations and has received grants.

What difficulties did you face during the establishment and operation of the foundation, in particular, in overcoming the cultural differences (and geographical chasms) between Ukraine and Britain? Have you experienced these differences?

It seems to me that the Ukrainian startup ecosystem is slightly corrupted by the American approach to venture capital and startups. In fact, Silicon Valley is corrupted because there is a certain misinterpretation of some principles. For example, the idea of thinking big doesn’t negate the need to be present, polite, modest, open, in terms of transparency. For local British investors we work with, the main thing is the issue of trust and the realism of various projections regarding the assessment of their company in the market. Perhaps this is a somewhat pragmatic approach, but it has more business grounds and requires honesty, or as they say, being a good citizen.

I also want to mention something potentially unpleasant for Ukrainian companies and founders: the fact that the whole world is currently supporting Ukraine does not negate the requirements for Ukrainian startups remain the same as for startups from any other country. Sometimes this line between what is possible and what is not blurs. When a foreign investor meets a Ukrainian startup, they simultaneously have a choice from many startups working in the same industry and not related to Ukraine or Eastern European countries. One must consider the competition that exists beyond the Ukrainian information field, especially when it comes to Britain.

You have been working as an accelerator since 2016. In your opinion, how has the market changed and is it now more difficult for startups to attract funds right now? Have the selection criteria changed for them?

Denis commented:

I don’t think the selection criteria have changed significantly. Of course, there are questions related to compliance, team, but it seems to me that, on the contrary, due to extremely unpleasant reasons related to Russian aggression, attention to the Ukrainian IT and startup industries has grown significantly. And when we talk about the early stages, it seems to me that at these stages, the focus is on the human potential and capabilities, and the talents of Ukrainian companies, which are outstanding compared to other startup teams.

The ingenuity of Ukrainian founders is impressive. Their emotional resilience and flexibility don’t come from the DNA of the company, they come from the person. And these characteristics give Ukrainian founders an advantage on the international stage. And I hope that because of this, Ukrainian companies will become successful because they currently have more representation abroad and exist in many different countries. For example, one founder abroad, and the team in Ukraine, or vice versa, founders in Ukraine, and the team in Poland. All these pirouettes and combinations will ultimately have a great, cumulative effect for the entire industry.

I hope that in a few years, there will be more such small funds for London, but very important for Ukrainian founders, like ours, appearing on an independent basis, as a result of successful exits of Ukrainian founders, or as an allocation of very large funds that want to pay special attention to founders from Ukraine.

Viktor added:

I want to note that in Ukraine, the full-scale invasion is perceived as an invasion directly into Ukraine, but in Europe, in Britain, it is seen as a war in Europe. And this, of course, affects the investment climate.

In 2022-2023, we saw a decline in the number of deals. Therefore, on the one hand, it’s difficult for us to launch a new fund in a crisis, but on the other hand, we understand – this is a very good moment because it has become harder to obtain investments for Ukrainian and Eastern European startups. We believe that 1991 will be a small stepping stone that will help alleviate this and impact the unfavorable conditions in the market.

Tell us about your team.

Before the full-scale war, we had offices in London, Kyiv, and Mariupol. Unfortunately, it has been lost.

In London, the team is small. Viktor and I are GPs of the fund, and we also had one person who left GP and became our advisor. We also have a group of advisors who represent a whole group of five organizations that help the fund in various aspects. We work with them on a regular basis. Global company Morgan Lewis helps us with legal issues,

Denis said.

In Ukraine, we are used to turning to lawyers when urgent issues need to be addressed. The support of a legal company in Britain is somewhat different because they are a permanent advisor on many issues, and they are liable for their work. 

We also have a separate group of advisors who work with us on fund management. The team in Ukraine is working to ensure the stability of the accelerator’s development and to contribute to the development of the ecosystem through events, programs, and so on.

1991 has carried out many programs, accelerators, and other projects in Ukraine, but legally not related to the fund because it is an unregulated activity, even abroad. Therefore, legally these are different things, but still, it’s one group of companies linked together by various elements, such as the brand.

Do you plan to expand, increase the team in Ukraine?

Yes, we plan to, but we cannot share this information at the moment. The only thing I can say is that the Ukrainian community is not limited to Ukraine; there are many powerful centers with Ukrainian founders around the world that have emerged. And we were interested in collaborating with these hubs, which would bring great value to the entire ecosystem.

Tell us more about your partnership with the British funds Venrex and Samos Investments. How quickly did you manage to raise capital from them?

We started working together about a year and a half before the first document was signed. However, informally, we quickly solidified our intent. They formally act as LP’s in the fund. It is worth noting that their role is not limited to financial investments since they are very powerful financial institutions with extensive expertise in the market.

Vendrex is a financial fund, a veteran of British venture capital, and an early investor in Seedcamp. Therefore, they understand well how startup platforms and accelerators transform into funds. And so, they often have something to say and advise.

Samos also once invested in Seedcamp and is an investor in Entrepreneur First. This is a quite powerful program that focuses more on founders rather than business ideas. Therefore, they have a slightly different worldview, but nevertheless, it is very useful.

There is a lot to say about Samos because it is an investment fund that has many different directions, including a separate structure represented by a private equity fund. They provide a lot of advice, expertise, and various connections.

Can you share some of your plans for the future?

One thing I’d like to mention is that the fund typically constructs its plans very simply. They mainly concern portfolio growth and work with the current portfolio. Therefore, these plans are usually not very interesting because the world learns about them when something happens with portfolio companies: they raise funds, or exit, or undergo M&A.

But we would like Ukraine to be sufficiently represented at London Tech Week this year so that the companies that fall under the UK-Ukraine Tech Bridge initiative represent the country. We want to attract the investment potential of the British venture capital community specifically for this initiative because the British government has a lot of contacts in the venture market.

Additionally, 1991 Ventures is an accredited member of the British Private Equity and Venture Capital Association. Through the BVCA, we also plan to develop certain initiatives related to Ukraine and Eastern Europe. Because our goal is to make it easier for Ukrainian companies to navigate in Britain and to establish this connection.

AIN had the opportunity to talk with Venla Väänänen, Marketing & Platform Manager at Maki.vc, discussing the fund’s activities in 2023 and plans for 2024, as well as talking about the CEE and Finnish market.

Tell us about Maki.vc.

Our founding partners include Ilkka Kivimäki and Pirkka Palomäki. We also have Pauliina Martikainen and Paavo Räisänen as partners. Maki.vc invests in brand-driven and deep tech startups at pre-seed and seed stage. Our portfolio includes for example European quantum leader IQM and sustainable fiber company Spinnova. Additionally, we have €180 million AUM.

Maki.vc partners with deep tech and brand-driven companies obsessed with challenging category norms. The Nordics are our home, but we take on a global front in spotting the unexpected — venture capital investments from B2B to B2C, with a sweet spot for scientific advances, strong IP, and customer understanding that looks beyond convention.

What have been some of the biggest challenges you’ve faced in building Maki.vc, and how have you overcome them?

Macroeconomics affects the venture capital industry in many ways, as it affects how many top notch founders are out there, how much top talent is available and how much financing is available in different stages of a startup.

That being said, having a talented team surrounding me and trusting in the investment & platform process that we have has always carried us through the hurdles!

How is Maki.vc’s performance in Q1 2024: how many investments were closed?

During first 4 months of 2024, we closed a number of investments, adding bright founders and brilliant companies to our esteemed portfolio. While we’re unable to provide specific details at this time, our team excited about the potential these companies hold and look forward to sharing more information as appropriate.

Were there any successful exits yet?

Our portfolio company Ultimate.ai was acquired by Zendesk and Alvar Pet was successfully merged with Kivuton, also bringing aboard a new majority shareholder.

How can you describe the Nordic VC market now, in particular in Finland? 

The Nordic VC market, particularly in Finland, is vibrant and dynamic, with significant potential across various industries. We’re witnessing a diverse range of innovative startups and entrepreneurs emerging, fueled by a robust ecosystem of support and investment.

In Finland specifically, we see a wealth of opportunities across sectors such as technology, healthcare, sustainability, and beyond. The country’s strong tradition of innovation and world-class talent pool continue to attract attention from investors globally,

At Maki.vc, we’re particularly excited about the prospects within the Nordic VC market. We believe in the power of disruptive ideas and are committed to supporting the growth of promising startups that demonstrate potential for scalability, innovation, and impact.

Tell us more about Maki House. Does this community still exist and what is the focus of its activity? 

Yes, and it’s thriving! We strive to be an accessible and yielding powerhouse with a global foothold. Whether building from scratch, fine tuning a product or brand, or navigating new markets, our entire network of investors, LPs and brand partners works side by side with our companies to supercharge their growth. Monthly, we bring global industry pioneers to talk with our founders and executives about a range of topics:

• People Management;
• Product;
• Financial modeling;
• Branding.

Previous speakers have included founders of Wolt, Product lead of Uber/LinkedIn, VP People of Payhawk, and much more.

For a while now, our special emphasis has been ESG related topics. We believe that by keeping ESG at the core of our work, we are able to build truly resilient and remarkable companies that can thrive through the hurdles of reaching sustained business growth,

We integrate ESG practices throughout the investment lifecycle, all the way from due diligence to exit. Our emphasis lies in identifying risks related to our portfolio companies’ operations, as well as approaching ESG as an opportunity to create value in pre-seed and seed stages

Has anything changed in Maki.vc’s approach to investments recently? Did the average ticket size, focus, or geography change in any way?

We continuously evaluate and refine our investment strategy to adapt to evolving market conditions and seize emerging opportunities. While our core principles remain steadfast, we may make adjustments to our average ticket size, focus areas, or geographic scope to best align with our long-term objectives and maximize value for our portfolio companies and investors.

Does Maki.vc experience any effects due to the harsh geopolitical climate, war in Ukraine in particular?

Maki.vc remains vigilant and closely monitor the situation surrounding the war in Ukraine and its potential impact on our investments and the broader market. While geopolitical events can introduce uncertainties and challenges, our diversified portfolio and rigorous risk management practices help mitigate potential risks and ensure resilience in the face of adversity.

Among most recent rounds joined by Maki.vc were Norwegians Databutton and Strise. On a personal note, can you tell us about the specificity of the fintech and deep tech investments made by Maki?

Fintech and deep tech are two areas where we see tremendous potential for innovation and disruption. In fintech, we’re particularly drawn to startups that are leveraging technology to enhance financial services, drive efficiencies, and improve user experiences.

With deep tech, our focus is on companies that are pushing the boundaries of technology and innovation across various industries, from artificial intelligence and machine learning to robotics and quantum computing.

In terms of industry trends, we’ve observed a steady increase in both the volume and number of deals within fintech and deep tech sectors. This growth reflects the expanding opportunities and heightened interest from investors in these areas.

What are your plans for the future growth and development of Maki.vc? 

Our plans for the future growth and development of Maki.vc revolve around positioning ourselves as the foremost Nordic seed VC investor and supercharging our platform offering to provide our founders with the best resources available.

• Founded in 2016 by Maciek Balsewicz, bValue is a growth equity firm focused on high-growth and profitable companies in the CEE region. In the interview for AIN, Maciek Balsewicz said that bValue aims to invest in companies that look for full exit within 3-5 years and want to achieve profitable growth without further outside financing.

• The firm has been managing a €100 million growth equity fund for entrepreneurs in CEE and an early-stage fund of €20 million. They have already made 36 investments and exited 12 companies. Its portfolio includes companies like Tidio, More Growth, Spin.ai, Aggero, Your KAYA.
• bValue Growth is bValue’s third and largest fund. BVG aims to invest sums of €5 million — €15 million in a single ticket for an equity stake of 20-40%. In addition, it will also acquire majority stakes. The fund is focused on fast-growing companies from CEE with a significant technological component.

bValue’s strength lies in using the language of technology to build strong relationships with entrepreneurs. Our experience and organizational culture enable us to act as a valuable minority partner capable of adding tangible value,

Maciek Balsewicz, bValue Fund Managing Partner, says.

Roughly half of the capital raised during this phase comes from financial institutions, including the European Investment Fund and the Polish Development Fund. The rest of the capital came from private investors, including Polish and foreign family offices. It was also made possible via the European Scale-up Action for Risk capital (ESCALAR) programme which supports investments in scaleups.

Not long ago, the company closed several deals with $50,000 checks with Mantis Analytics, CloudAvocado, and Fintellect and invested $180,000 in S-Lab during the seed stage.

AIN spoke to Andrew Zinchuk, the co-founder, about the most successful startups “to become unicorns,” minimum checks to join a syndicated network, and exclusive details of a new crowdfunding project for investing in defense tech startups.

“If you want our funds, come to us at least six months in advance.”

Nowadays, you actively participate in syndicated deals through your own ZAS.Syndicate community. Are you satisfied with the results, and how does it technically look in reality?

We are one of the first syndicates in Ukraine, right after ICLUB. Our first deal was with Zeely in early 2023.

Following our example, other ventures created their syndicates: Toloka.vc, SID Venture Partners, or United Angels Network. The last one is developed by Ivan Dmytrasevych and Sasha Reminnyi.

You must understand all syndicates have their missions. We, as a venture and a syndicate, are focusing on startups with Ukrainian founders. Our mission is to support them with investments. The conditions are that most team members are in Ukraine and a foreign legal entity, for example, in Delaware (USA) or Estonia. Unfortunately, it is what the current market dictates, and we can’t change it. And the last condition is a startup’s active traction.

As a syndicate, we invest from pre-seed to Series A. We and our investment company usually sign two $100k checks in parallel against specific KPIs during the pre-seed stages.

Our goal is to make one deal every month. How it goes: We give a pitch deck and a brief project description to our investors. After that, we send interested parties a deal memo, detailed information about a startup, and our “homework” about why we believe it would be worth investing in. One or two weeks later, we will do an introductory call with the startup team. Then, we will involve the interested investors who showed in this deal.

Which startup requirements do we have? If you want our funds, come to us at least six months before fundraising. We are the only one in the market with office hours: you can come during those hours, pitch your startup, and get our feedback. We will follow your activity after you get us interested.

The closer the fundraising, the more we will give you mentorship. During these six months, we want to see three things. The first one is the startup’s delivery or how they achieve KPIs, follow the roadmap, and perceive feedback. The second thing is the startup’s fuck-ups and how their team solves critical issues. And the third one is status updates. We have specific monthly report forms.

We see the importance of running this track together and discovering more about the project team. Because you usually invest in the team during a pre-seed round. 

Another critical startup pre-development assessment indicator is our 3-3-3 method: three months of traction in a foreign market (most of the time, it’s America and Europe), at least a $3,000 MRR, and a 30% growth until the end of the month. Although some startups struggle with fulfilling those requirements, for example, a B2B project with complicated sales, low-touch selling projects can do it.

If a startup does 3-3-3, we invest $100,000 in installments through our investment company against set KPIs and make another $100,000 deal within our syndicate. For instance, we invested $50,000 through our foundation within the deal with S-Lab and had to invest the same amount from the syndicate. Nevertheless, we raised $130,000 as a syndicated investment, resulting in $180,000 in total.

We always make pre-seed investments from the investment company first, so it takes the most risks. We split a check in installments according to the KPIs achieved. And in three to four months, we present the project to our syndicate. So, the syndicated deals face much fewer risks thanks to the startup’s live traction. However, the syndicate must consider investing based on an evaluation of the foundation. Then, we invest in seed, later seed to Series A with a check of up to $1,000,000.

So, we closed three syndicated deals last year. The first one was Zeely—$125,000—which raised $1m within the round. The second investment was $500,000 in ComeBack Mobility and a $500,000 allocation against achieving the set KPIs. The third deal was S-Lab, which got $130,000 from the foundation and syndicate. That means we invested almost $800,000 in 2023 only through the syndicate.

Zeely is worth my special attention. They finished the third year of their product existence with a $300,000 MRR and a $4,000,000 ARR. And now, they are closing a pre-series A round with an evaluation of $26 million. We prepared a $500,000 allocation and almost raised the amount.

For our syndicate members, the round was closed in March 2023, and a new round started in December 2023, six months later. The startup evaluation increased from $10m to $26m during this period.

“We will make 12 to 15 deals this year.”

How does your syndicate look from the inside?

We have no paid membership, but all members must invest at least in one deal a year. If they don’t know how to invest, they learn together with us.

In order to join us, you should fill out an online form on our website and wait for my call. I do all the calls with potential new members to understand if our values match.

We also created a Discord channel where syndicate members can chat, discuss ongoing deals, and back our portfolio startups. A highlight of this communication will be our first offline community event to devirtualize and present the next startups in our pipeline.

How many members do you have now, and what is a minimum investment check?

Our community has about 70 people at the moment. $10,000 is the minimum check within the syndicate, but it also could be $5,000 in case of a joint investment with our venture firm. We understand our responsibility to select syndicated deal investors. They must bring relevant expertise and help a startup grow, even if they signed small checks.

When your venture created a venture firm in the past year, you declared a goal to do 30 pre-seed investments in Ukrainian startups. Do you catch this goal?

We follow our plan. Last year, we closed four deals. This year, we will do 12 to 15 more. And the remaining deals will be closed in 2025. Our great goal is 30 new unicorns in Ukraine until 2034.

Which startups would be the fastest to achieve a $1,000,000,000 evaluation?

I think it would be Zeely. They plan a Series A round until the end of 2024 with a sound multiplier after this round. And I know some serious players are watching them.

They meet the T2D3 (triple-triple-double-double-double) requirement: after getting its first $1m ARR, a startup should grow triple in the next two years and double again within three years. Zeely grew up four times after its first $1m ARR.

I may also not name another project yet because it is our next potential deal. If it fulfills signed contracts, it will most likely become a unicorn within the next 3-4 years.

“The investors are very compassionate with the events at the forefront.”

ZAS Consulting is a part of your ecosystem. What does it do?

It’s new. I found its importance when I saw how many foundations look for Ukrainian deal flow but don’t know where to find it. The initial war shock is long behind, and they want to invest. We provide two simple services: paid access to deal flow for subscribers and analytics. We are an experienced venture and know how to do due diligence, reference checks, and background checks of founders.

Including Defense Tech, correct?

Correct. By the way, we launched the first equity crowdfunding platform in Ukraine, BeFunders, exclusively focusing on defense tech projects. Any startup confirmed by Brave1 can be placed on our platform and funded by Ukrainian residents. The checks start from $100. The motto of this project is “Become a Co-Owner of Our Victory.” Last week, we closed the first deal which we will publicly announce in July.

So, we work in stealth mode now. Since it is a B2C story, it requires a decent technical implementation because when Russians see the platform, they will DDoS it.

We solve two issues with the project. The first one is the so-called “donation tiredness.” People become co-owners of the project and can get an upside when the business transforms or gets sold, or an exit will happen.

The second problem is gambling—some soldiers, unfortunately, lose all their combat bonuses or take loans. And we give them a chance to invest in a new military development instead of gambling. They will use the product among the first and make more “Russians good.”

In previous interviews with AIN, you mentioned a curious detail: ZAS Ventures doesn’t invest in startups in the Web3 and hardware domains. Did it change or not? Because many defense tech projects work with hardware.

We don’t work with Web3 if it concerns cryptocurrencies or related services. However, if it concerns a direct blockchain application in a real-economy sector, we are ready to examine such projects more closely.

Our investment company doesn’t like hardware, it’s true. However, our next deal is with a hardware company with a founder you can’t refuse his offer. He has 20 years of experience in the industry and a lot of successful cases. If it were someone else with shorter traction, I would say no.

My last question is about the Ukrainian investment market. In the past year, you said that, unfortunately, only a few investors pay attention to 100% domestic Ukrainian products. Is it better now?

Let’s focus on syndicates and our foundation. In Ukraine, we invest only in local founders as the only pre-seed investor. The others always have a condition of having a diversified foreign presence.

I see the investors are very compassionate about the events at the forefront. For instance, everyone awaited the counter-offensive in the past year. But it didn’t succeed, and enthusiasm decreased.

In any case, there is always a space for optimists. Three weeks ago, I was in the Czech Republic at the Invest in Bravery event that united an insane group of investors—different foundations, angel investors, private equity, etc. They showed great interest in Ukraine, and in September 2024, they will organize a new event in Kyiv at which the best startup will win a prize.

After this event, I returned to my hotel room at ten o’clock at night and wrote to all the founders and managing partners of ventures I know in Czechia. They all responded within three hours, and I met all of them during the next three days of my business trip. So, you can imagine a level of interest in the events happening in Ukraine. They also told me about their support of general and defense tech funds working for Ukraine and trying to exchange deal memos, which inspires people who consider a crisis a time of great opportunities.

AIN shares the list under the opinions category. You can read the full article by following the link to the Level2 Ventures blog page, here.

A robust post-investment partnership doesn’t just leverage the financial aspects but harnesses the full spectrum of resources that investors bring to the table. There are a few effective strategies for startups to maximize the benefits of their relationships with venture capital partners:

Establishing effective communication channels

Clear and consistent communication forms the foundation of any successful relationship, including the one between a startup and its investors. Establish a routine of structured updates and regular check-ins, such as monthly newsletters paired with quarterly meetings. These interactions should not only report on financials and key performance metrics but also explore strategic discussions and solicit guidance. A transparent approach fosters trust and respect, facilitating a more engaged and supportive investment partnership.

Leveraging investor expertise for strategic advantage

Venture capitalists bring knowledge and a unique perspective, informed by diverse experiences with both successful ventures and instructive failures. Startups should consider actively seeking their investors’ insights on significant business decisions. Whether contemplating market expansion, adjusting business models, or navigating complex regulatory environments, investors can provide invaluable guidance.

Expanding opportunities through investor networks

A distinct advantage offered by venture capitalists is their extensive and often influential network. This network can open doors to potential customers, strategic partners, key hires, or even future funding rounds. Startups should work closely with their investors to identify how best to engage with this network.

Proactive engagement in problem solving

Instead of waiting for challenges to escalate, startups should proactively involve their investors in problem-solving. Venture capitalists can provide alternative perspectives and innovative solutions, potentially averting crises. They may also serve as strategic advisors during critical junctures, offering insights that steer the startup toward stability and growth.

Cultivating a supportive community

Many investors nurture a community among their portfolio companies, creating a supportive network that enables peer-to-peer learning and collaboration. Active participation in such communities can yield significant benefits, including shared resources, collective learning sessions, and networking events designed to foster connections and growth.

The dynamic between a startup and its venture capital partners is pivotal and extends well beyond mere financial support. It’s worth taking benefit of.

• Interactive Venture Partners is a US-based fund and fund management company, complemented by a Budapest-based team. Interactive Venture Partners provides early-stage investments in companies across industries in CEE, preferring some technology-based differentiation.
• The initial capital commitment of the fund is €50 million. For now, the fund has already made 6 investments, two of which were already announced: Mitzu.io and Captiwate. The fund will announce further investments soon.

We offer entrepreneurs US family office style investing with founder-friendly terms, mentoring, a long-term view, quick decision making, deep financial capacity for follow-on funding (if appropriate), as well as an international network,

Laszlo Czirjak, Managing Partner, Interactive Venture Partners, stated.

• According to Interactive Venture Partners, it supports startups seeking to grow by gaining access to larger markets and to a broader network. Additionally, Interactive Venture Partners is an affiliate of the Interactive Brokers Group of Companies, and its managed fund is supported by entrepreneur Thomas Peterffy, founder and Chairman of Interactive Brokers Group, Inc. 

The team of Interactive Venture Partners also claims that their mission is to create entrepreneurial wealth in the region, encourage more serial entrepreneurship, attract more institutional investment, and thereby bolster and grow the CEE startup ecosystem.

• SmartCap is a small fund management company, a subsidiary of the Estonian Business and Innovation Agency (after the merger of Foundation KredEx and Enterprise Estonia), registered with the Estonian Financial Supervision Authority and managing the SmartCap Venture Capital Fund and SmartCap Green Fund.
• SmartCap Green Fund was advised by Ellex Partner Antti Perli and Counsel Gerd Laub. One of its latest investment deals was the €4 million round for the Estonian producer of sustainable carbon nano-materials UP Catalyst.

Details about SmartCap Green Fund Direct Investment Program and new changes

• The Green Fund Direct Investment Program aims to support early-stage startups that develop green technologies, operating energy, agriculture, food industry, transport and logistics, material and chemical industry, and environment. The companies must be established in Estonia and conduct business activities there.
• Through SmartCap’s Green Fund, the volume of which is 100 million, it is planned to offer equity investments together with private investors until 2026. 
• After changes, the Green Fund’s investment in one startup will now range from €500,000 to €5 million. The Green Fund is also ready to invest in later stages, including Series C funding rounds, where companies are in an active expansion phase and need capital to accelerate growth.

The purpose of the changes is to ensure better access to capital for green technology companies that have already passed the first rounds of financing and to provide the next push to further develop their product or services and enter new markets,

Ellex Partner Antti Perli, commented.

As before, the following principle will continue to apply. The Fund invests in companies together with private investors, and private money must account for at least half of this funding round. At the same time, at least 30% must be new private capital for the company.

• Purple Ventures’ Fund I was launched in 2018 by Jan Staněk. Currently, its total funding amount is €15 million. Purple Ventures is focused on backing startups in the pre-seed and seed stage. The fund has supported over twenty companies in six years. A few of them are CEE startups such as Hedepy, Tatum, Choice, and Kardi AI.

About Fund II

The second fund will be open to external investors. It will focus on startups from the CEE region with teams in the EU. The ticket size will be from €250,000 to 750,000.

The fund plans to invest in various emerging segments such as:

• Digital Health;
• SaaS;
• EnergyTech;
• Creator Economy;
• Security;
• EdTech;
• E-commerce;
• Deep Tech;
• IoT.

In the past six years, we have been able to identify a number of interesting companies. However, we can clearly see that the potential of the market is many times greater and that with the help of external finance we can achieve many more interesting opportunities,

Jan Staněk, co-founder and Managing Partner of Purple Ventures, commented.

Purple Ventures plans to invest the first €14 million this year, while the rest is going to be collected within the next two years. In addition to the funding, Purple Ventures will continue offering guidance to the startup founders, acting as mentors and advisors. The first exits are planned after 2028. 

• 1991 Ventures is a London-based seed venture fund founded by Ukrainian brothers, Denis and Viktor Gurskyi, who are better known for running incubation and accelerator programs inside Ukraine. The Gurskyi brothers previously backed more than 200 startups between 2016 and 2024, via their incubator Social Boost and their 1991 Accelerator.

• In 2019, the Gurskyis created 1991 Mariupol. It is a technology startup center, launched with Ukrainian President Volodymyr Zelenskyi present — served as an outpost of East Ukrainian innovation, giving the frontline port city hope. 

About the new 1991 Fund

1991 Ventures plans to invest in over 40 companies across the fund’s lifecycle and will build on the incubation and accelerator programs the Gurskyis have been running from Kyiv and now London, which have seen a third secure funding. It is also backed by UK’s limited partners Venrex and Samos Investments, early institutional investors in Seedcamp and Entrepreneur First. 

It’s very hard for Ukrainian founders to tap into London. So we would like to provide them with pre-seed or seed funding so that they can… access larger rounds in the future and understand how the U.K. can be a springboard to global funding,

Denis Gursky, founding partner of 1991 Ventures, commented.

AIN shares the list of these key factors that investors prioritize when evaluating startups for investment written by Yordan Zarev, Partner at New Vision 3 Fund. You can read the insights into what makes a startup truly stand out in the eyes of investors in the original publication here.

1. Unique Value Proposition:

Startups with a unique value proposition that solves a real problem for customers and offers a clear competitive advantage are more likely to attract investment. According to a study by CB Insights, 42% of startups fail due to a lack of market need. Investors look for startups with innovative products or services that differentiate them from competitors.

2. Strong Team & Founder Commitment:

Investors often prioritize startups with a talented and experienced team capable of executing the business plan. According to research by Harvard Business Review, 23% of startup failures can be attributed to team-related issues. A strong and resilient team with a track record of success, relevant industry expertise, and complementary skills is a positive sign for investors. Investors evaluate the commitment and vision of the founders or founding team. Startups with passionate founders who are fully committed to the success of the venture and have a clear vision for the future are more appealing to investors. Founders with a clear mentality of scaling teams by hiring top talents at key positions and delegating key processes to them (instead of micro-managing their business) are also critically assessed by VCs. 

3. Market Opportunity and Demand:

Investors are interested in startups addressing large and growing markets with significant potential for disruption or innovation. According to Statista, global venture capital investment reached $300 billion in 2020, with a significant portion allocated to startups in high-growth sectors. Startups that can demonstrate a deep understanding of their target market and a clear strategy for capturing market share are more attractive to investors. Scalability is a factor too, meaning the ability to expand into new markets, serve a large customer base, and increase revenue without proportional increases in costs.

4. Business Model & Traction:

Investors assess the viability and sustainability of the startup’s business model, including revenue streams, pricing strategy, and customer acquisition and retention strategies. According to PitchBook, startups that successfully raise Series A funding typically have an average revenue run rate of $1.5 million. Investors want to see evidence of traction and progress, such as user growth, revenue generation, partnerships, or product development milestones. Startups that have achieved meaningful milestones demonstrate validation of their business model and potential for future success.

5. Intellectual Property:

Startups with proprietary technology, patents, or other forms of intellectual property protection may have a competitive advantage and be more attractive to investors. According to WIPO, global patent applications reached 3.3 million in 2018, highlighting the importance of intellectual property in today’s innovation-driven economy. Investors look for startups with defensible intellectual property rights that provide a barrier to entry for competitors.

6. Fit with Investor’s Portfolio:

Finally, investors consider how well the startup fits with the VC model, their investment thesis, portfolio strategy, and risk appetite. Startups that align with an investor’s areas of interest, expertise, and investment criteria are more likely to receive funding.

Securing investment is a critical milestone for startups looking to scale and succeed in today’s dynamic business landscape. By understanding and emphasizing these key factors—ranging from a compelling value proposition to a strong team and strategic market positioning—startups can enhance their attractiveness to investors and pave the way for long-term growth and success. With the right combination of innovation, execution, and alignment with investor preferences, startups can unlock the support they need to realize their vision and make a lasting impact in the market.

About New Vision 3

New Vision 3 is one of the most active VC funds across the CEE region, particularly in Bulgaria. NV3 invests in early-stage technology companies in fintech, AI, blockchain, shared economy, e-commerce tech, green energy, frontier tech. The fund’s commitments amount to €22.3 million. Throughout 2023, the fund managed to secure several big deals in the market. You can read the details in our interview with Zlatolina Mukova, Managing Partner at New Vision 3, here.

• Founded in 2017 by Polish Adam Niewinski, Gregory Jankilevitsch, and Marcin Hejka, OTB Ventures invests in early growth, post product, high-tech startups with unique technologies. OTB Ventures has offices in Warsaw and Amsterdam.
• With its first $138 million fund, launched in 2017, it invested in companies such as Polish-Finnish ICEYE, Poland’s Silent Eight, and Lithuania’s kevin. 
• The first close of its €150 million Fund II was in November 2023, and since then, OTB Ventures has already invested in nine companies including productivity and task mining platform KYP.ai, AI chip producer SEMRON, and space debris removal startup ClearSpace. 

About Fund II

Fund II will target four core sectors critical to Europe’s technological advancement:

• SpaceTech
• Enterprise Automation & AI
• Cybersecurity
• FinTech

Similarly to the Fund I, Fund II will primarily focus on Series A investments, providing growth capital to promising startups. However, up to 10% could be allocated to seed funding, and more than 50% to follow-on investments.

DeepTech is in our blood and has been our core strategy since we founded OTB in 2017. This milestone not only marks a significant achievement for our firm but also reaffirms our dedication to fostering innovation and entrepreneurship,

Marcin Hejka, co-founder and Managing Partner of OTB Ventures, commented.

• The Fund II is supported by a consortium of investors, including the European Investment Fund (EIF), Isomer Capital, CEE entrepreneurs, with LPs including Snowflake co-founder Marcin Zukowski, and OnDean, the family office of the Founders of Relativity.
• Now, it has also received support from the NATO Innovation Fund (NIF).

The partnership with NIF shows OTB’s commitment to supporting the development of “dual-use” disruptive technologies with both civilian and defense applications. In September 2023, NATO Innovation Fund closed its $1 billion flagship fund investing in deep tech, defense, security, and resilience startups with themes including energy, quantum computing, autonomy, climate, industries, space, and biotechnology.

AIN had the opportunity to interview Zlatolina Mukova, Managing Partner at New Vision 3, discussing the fund’s activities in 2023 and plans for 2024, as well as talking about the CEE and Bulgarian markets.

Tell us about New Vision 3.

New Vision 3, as you might guess from the name, is founded by veterans in the VC industry in Bulgaria. Myself, a team manager at the Bulgarian Post-privatization fund back in 1999, joined by Konstantin Petrov, a start-up founder at investee company at that time, and both of us partners at Neveq1 ( 2007 ) and Neveq2 (2012) funds, Jordan Zarev  and Alexander Terziyski, investment professionals at Neveq2, and Jordan Stoyanov and Filip Genov, bringing solid banking VC experience from the largest Bulgarian bank. NV3 operates from Sofia, Bulgaria, and invests in fast-growing tech companies, which aspire for the leading position in their domains on the local and/or global markets. 

NV3 invests in early-stage technology companies in fintech, AI, blockchain, shared economy, e-commerce tech, green energy, frontier tech. To 100 years of joint experience in venture capital, €50 million investments in local start-ups, three VC funds, over €50 million co-investments, the team adds a success record of 7 exits to multinational players, mostly listed on the West European and US stock exchanges. The fund manager is a proven partner of visionary entrepreneurs creating new global technology solutions and business models from East Europe. 

NV3 fund commitments amount to €22.3 million, where the leading co-investor is the Fund of Funds in Bulgaria with a commitment of €19.1 million provided by the operational program Innovation and Competitiveness 2014 – 2020, co-financed by the European Structural and Investment Funds.

2023 seemed like quite a busy year for NV3, with nearly a dozen new investments announced only in Autumn. What is the exact number of closed deals in 2023, and how did you manage to do it?

We invested in 18 companies in 2023, which was the last year of our investment period. But the preparation of the deal pipeline started in previous years. And most of the deals come from our network of contacts. As we are so long on the market we are very well connected, moreover some of the founders from our previous funds are already investors themselves bringing a lot of contacts, but also knowledge in the tech space which helps to validate the hypothesis of candidates for investment. Our rich experience also helps to close deals faster.

Can you tell us more about the recently announced Autumn batch of 7 startups?

• QuarkXR is a company we have been following for a few years. It develops a Next Gen compression and streaming Technology, an ultra-fast software solution that provides low-latency wireless transmission.
• CoLumbo reads spine MRI scans better and faster than humans. The software has a CE mark, FDA 510(K), and TGA clearance. The key novelty of CoLumbo lies in the unique machine learning algorithm, based on fully convolutional neural networks combined with medical domain knowledge. Health tech is one of our target sectors and we are very happy to have been able to invest in such a promising company.
• 365 Data Science provides a holistic data science and AI training, including the technical expertise and soft skills needed to ensure long-term success in a dynamic job market. Its courses and projects are based on real-life use cases people can expect when they get hired. Job candidates can verify their data and AI skills with industry-recognized certificates and get a desired job.
• AdScout is an ecommerce tech company that builds a network of trusted recommendations, connecting satisfied users with popular brands. This is our second investment in this sector, and we believe it will be a game changer in the way people make buying decisions.
• Vibejobs is a job platform in Viber that enables companies to find and attract Blue-Collar Workers utilising a chatbot-based solution for communication and recruitment automation. The platform is making digital hiring accessible to all people looking for jobs which are currently underserved.
• Bronia is a deep tech company specialized in next-gen intelligent & autonomous security solutions. Its AI-based acoustics signal processing platform leverages state-of-the-art proprietary technology to identify sounds of interest, locate their sources and act smartly across a variety of industry and security scenarios.
• eLando is a professional services company that provides innovative technology solutions using top notch delivery methodologies. The high level of technical expertise, complemented by break-through thinking and creativity are the key to their success.

What usually makes you think “We need to invest in this startup”?

It’s a difficult question, but I would say we are not making emotional investments. We are analyzing every aspect of the business – market, product, team – before making any decision.

From your experience, can you tell us what differentiates Bulgarian startups from others in Europe?

I wouldn’t say there is much difference especially with the ones in Eastern Europe. Compared to Western European ones the difference is, surely, the lower amount of available capital, as well as weaker connections with the large markets in the EU and the US. Thus, startup founders in the region more frequently resort to bootstrapping strategies compared to their western counterparts.

Can you walk us through the specifics of the Bulgarian Startup and VC ecosystem? How is the ecosystem faring recently?

I believe the Bulgarian startup and VC ecosystem is one of the most developed ones in the region. Important driver for this development was the specialization of Bulgaria in the IT sector in the socialist past. Then, the successful programmes of the European Investment Fund aiming at building of professional fund managers and attracting private capital alongside EIF. Despite the overall VC funding downtrend, the ecosystem is faring quite well in Bulgaria.

Are there any notable changes between the ecosystem in 2019, when you started, and now?

NV3 started in 2019 together with a bunch of other VC funds targeting companies from the seed to growth stage. As of today, all 2019 vintage funds are beyond their investment period and one can feel the lack of capital on the market. Nevertheless, the Fund of Funds and the EIF are in the process of selection of fund managers for new funds and we hope they will be operational early next year at the latest. It is still very difficult to raise funds in Bulgaria without those two important players.

As regards investment proposals, we are evidencing a larger number of quality deep tech projects.

What are your general predictions on the market in 2024?

The market is recovering from the 2022 capital crisis. Still, the recovery is not as fast as we would like it to be. No doubt, AI will continue to be a bright spot for investors.

Can you share some of your plans for the future?

As you know, VC fund managers are in the startup mode themselves. Thus, our team is also looking into raising its next fund.

• Founded in 2020 by Mads Troelsgaard (CEO), Sune Wolff (CTO), and Thomas Fenger (CXO), SynergyXR is a no-code, cloud platform that lets companies train, onboard, sell, and support employees across all XR devices without writing any code.

In today’s dynamic digital landscape, transformation is not just about staying relevant; it is about seizing the lead with technology that’s already proven its worth. Despite a tightening investment climate, our ability to not only retain our trusted investors but also welcome Kvanted into our circle is a testament to our vision’s strength and our technology’s impact. This partnership marks a pivotal step towards accelerating our growth across the Nordics and the UK – and Europe and the US, as well – setting new benchmarks for success in our industry,

SynergyXR CEO, Mads Troelsgaard, explains.

• The funding was led by Kvanted, a Helsinki-based early-stage investor founded by Eerik Paasikivi, Maria Wasastjerna, and Axel Ahlström. The firm invests primarily in Northern European companies building new software and hardware solutions. With the first fund of €70 million, raised in 2023, Kvanted is the first pure-play industrial technology investor in the Nordic region.
• Additional existing investors during the round are EIFO, Innovestor, North-East Ventures, and AURA Ventures.

SynergyXR will use the investment to expand its reach across Europe and the United States, driving the next wave of digital transformation in the manufacturing, production, and energy sectors.

About RemotePass

• Founded in late 2020 by Kamal Reggad and Karim Nadi, RemotePass develops and builds an all-in-one platform for companies to onboard, manage, and pay remote workers. The platform serves a range of clients, from startups to large enterprises, including Spotify and Logitech, facilitating hiring contractors and full-time employees in more than 150 countries.

• According to the company’s CEO, RemotePass grew 2x in revenue between 2022 and 2023, serving over 600 companies and 8,000 remote workers in emerging markets. Before the current round, the company managed to secure $5.4 million in venture capital to boost its customer and revenue growth.

Investment details

• The Series A round was led by 212 VC, an Istanbul-based VC firm investing in growth-stage tech companies across Turkey, CEE, and MENA.
• The round was joined by participating investors Endeavor Catalyst, Khwarizmi Ventures, Oraseya Capital, Access Bridge Ventures, A15, and the Swiss Founders Fund.
• Flyer One Ventures, a Ukrainian early-stage VC fund investing in B2B SaaS and consumer startups in Europe and North America, also participated in the funding.

I’m glad we met the company’s incredible founders Kamal Reggad and Karim N. and got to know each other. The guys are super experienced. Reggad has already sold one company, his e-commerce brainchild Hmizate. Nadi is ex-Salesforce, ex-Criteo, and ex-Krux (acquired by Salesforce). They are game-changers, and I look forward to seeing them grow,

Vital Laptenok, CEO at Flyer One Ventures, commented on his LinkedIn page.

• Following the round, the total capital raised by RemotePass has surpassed $10 million.

What’s next?

The fresh growth capital enables RemotePass to focus on enhancing its product for enterprise use and expanding its presence in Saudi Arabia through product localization and increased business engagement.

AIN.Capital’s chief editor had the opportunity to talk with Mariusz Adamski, a Partner at ff Venture Capital, about the fund’s activities in 2023 and plans for 2024, as well as discuss what makes the CEE market so appealing to investors.

Tell us the story behind ff Venture Capital.

ff Venture Capital is an early-stage venture capital firm with a unique footprint spanning the United States and Poland. Eschewing the traditional model of a centralized headquarters, ffVC embraces a modern, decentralized approach to venture capital. This is evident in its operation through dedicated teams that cater to the European and US markets, operating out of strategic offices in New York and Warsaw. Such a structure highlights ffVC’s dedication to combining local insights with a global perspective, ensuring a broad impact across the startup ecosystem.

ffVC’s journey began in 2008 with the establishment of its first office in New York City, marking the start of its mission to support early-stage ventures. Expanding its geographical footprint, the firm extended its operations to Warsaw in 2020, assembling a dedicated team of investment professionals to oversee its European ventures. This expansion reflects ffVC’s strategic intent to tap into the rich vein of innovation and entrepreneurial talent in Central Europe and to act as a bridge between these startups and global markets, especially leveraging its unique position to connect with Japanese corporate interests. 

In Europe, ffVC actively manages two funds. The firm’s inaugural fund, established in 2020 with anchor investors including Totalizator Sportowy and PFR Ventures from Poland, is already fully deployed. Building on this momentum, ff Venture Capital launched a new investment initiative in June 2023, aiming for a final close of €60 million. This new fund is particularly focused on empowering Central European startups, with a significant portion of funding sourced from Japanese investors. Specialising in sectors such as enterprise software, industrial technology, and sustainability transformation, ffVC distinguishes itself by facilitating unique connections between Central and Eastern European startups and Japanese corporations, a capability few European VCs possess.

In 2023, ffVC made a number of resounding deals. Can you share the general numbers and results of the year?

I’m thrilled to report that ffVC capped off 2023 with a series of remarkable milestones, including the successful closure of 9 new investments. This achievement not only shatters our expectations but also highlights our prominence among regional investment funds.

A significant development this year was the complete deployment of our first fund ff Tech and Gaming, demonstrating our commitment and strategic acumen in identifying and nurturing startup potential. Building on this success, we launched our second fund ff Red & White in Europe, reinforcing our dedication to driving innovation and supporting entrepreneurial ventures across the continent.

Among our notable investments is Molecule.one, a tech-bio innovator revolutionizing early-stage drug discovery with AI-enabled chemical synthesis planning, led by Piotr Byrski and Paweł Włodarczyk-Pruszyński. Additionally, ForActive, co-founded by experienced entrepreneurs Maciej Bieganski and Konrad Howard, is redefining connectivity within the health and fitness community.

2023 also marked a strategic expansion of our team with the addition of two new partners to our European operations, who relocated from Japan to Poland. This move not only strengthens our global perspective but also enhances our operational capabilities in Europe, further solidifying our position as a key player in the venture capital landscape.

ffVC was one of the leading international investors in the CEE region in 2023. In particular, the firm invested in Polish startup ReadyCode and Ukrainian AI startup Respeecher. Tell us more about those deals.

I am glad you asked about some of the most noteworthy investments circling around the entertainment sector. We think that both ReadyCode and Respeecher are both extremely interesting stories from the region which are both still somewhat overlooked.

ReadyCode was founded by a serial entrepreneur, Julek Kopczewski and it addresses the most important problem in game development — how to effectively market games and prolong their sales. The solution can be applied to different genres and the company is seeing strong interest from established game developers.

Respeecher is yet another fascinating story of a team that has thrived despite the war in Ukraine. They have a highly unique speech-to-speech technology and have the potential to become the dominant model in this space. The company has won multiple Emmy awards for voice cloning in TV series The Mandalorian or Richard Nixon in a short documentary. Now, it will be working together with CD Projekt for the Polish language release of the Cyberpunk 2077 expansion Phantom Liberty. [ed. Respeecher has already worked on character voices for Cyberpunk 2077]

From your experience, can you tell us what differentiates the CEE startups from others around the world? What drives you to invest in these startups?

The CEE startup scene distinguishes itself in several ways, making it an intriguing space for investment. One notable factor is the presence of a robust talent pool in the CEE region. Skilled founders, equipped with a diverse range of expertise, contribute to the development of innovative and competitive startups. This depth of talent often translates into a dynamic entrepreneurial environment, fostering the creation of ventures with unique value propositions.

Technological know-how is another key differentiator for CEE startups. The region has demonstrated a remarkable capacity for technological innovation, with startups often leveraging cutting-edge technologies to address market needs. This technological proficiency not only enhances the competitiveness of CEE startups in the global market but also positions them as leaders in specific niches.

Moreover, the presence of good technical schools in the CEE region plays a crucial role in shaping the startup landscape. Institutions such as the Warsaw University of Technology, which is now actively connecting with the venture world through the creation of a new fund, exemplify the growing synergy between academia and entrepreneurship. The integration of educational institutions into the venture ecosystem serves as a catalyst for innovation, providing startups with access to knowledge, resources, and mentorship.

The emergence of funds within technical schools, like the one at Warsaw University of Technology, is a testament to the evolving support structure for startups in CEE. This trend signals a proactive approach to fostering entrepreneurship, facilitating the transition of innovative ideas from academia to the marketplace. The collaboration between these educational institutions and the venture world enriches the startup landscape, creating a more interconnected and supportive ecosystem.

As an investor, these characteristics in CEE startups become compelling reasons for investment. The combination of a strong talent pool, technological prowess, and the increasing integration of technical schools with the venture world presents a promising landscape for identifying and nurturing innovative ventures. The potential for groundbreaking solutions, driven by skilled founders and supported by a conducive ecosystem, makes CEE an exciting and opportunistic region for venture capital investments.

With almost 16 years behind ffVC’s back, what are your thoughts on the current startup and VC climate in the world?

In my view, the current startup and venture capital climate appears dynamic and resilient. Despite the ongoing global challenges, there’s a palpable sense of innovation and adaptability within the startup landscape. Ventures seem to be navigating uncertainties with a blend of creativity and strategic thinking, showcasing the entrepreneurial spirit at its best.

On the venture capital front, it’s interesting to observe a continued appetite for diverse investment opportunities. The landscape appears to be evolving, with an increased emphasis on sectors that address the changing needs of our world, such as health tech, sustainable solutions, and digital transformation.

However, the scene isn’t without its challenges. Economic uncertainties and geopolitical factors could introduce elements of caution. Yet, this very environment often sparks ingenuity, with startups finding innovative solutions to not just survive but thrive in unpredictable circumstances.

Are there any notable changes between the global and Central and Eastern European ecosystems?

When we talk about the global scene versus what’s happening in Central and Eastern Europe, some commentators like to say the CEE market isn’t as active. Sure, the venture market had its ups and downs in 2023, deal-making in Europe took a bit of a hit compared to the years before. But if you check out the latest info from PitchBook, it shows that we managed to keep things above the average for the past 10 years.

Despite what people might think, we’re not seeing the CEE market as some kind of no man’s land. We’ve been facing the challenges head-on and actually found some great opportunities. Actually, we’ve been experiencing a totally different reality, only lately adding amazing companies to our European portfolio.

What are your general predictions on the market in 2024. And can you share anything on your future plans in 2024?

The ongoing development of AI technologies will likely make them more common in existing startups. I believe venture capitalists will be interested in finding startups that use AI to make things work better, make smarter decisions, and come up with creative solutions. This wider use of AI won’t just stay in tech – it will likely spread to regular fields like healthcare, manufacturing, and finance. The question that everyone is asking themselves today is how to capture value in this space and make investments that will realize returns over longer period of time. There is no obvious answer but we will for sure be actively reviewing any AI-related opportunities that have an asymmetric option value.

As the venture capital world matures, I think we’ll see more focus on teaming up and combining efforts. Bigger firms might try to expand by bringing in experts from different areas or teaming up with smaller local players. This could create a more connected network of venture capital on a global scale. Coming together could lead to a stronger and more cooperative investment world, where teamwork drives new ideas and smart decision-making.

Talking about IPOs, they’ve had a tough time recently. But I’m hopeful that as the economy gets steadier, companies with solid foundations will find it easier to go public. I think if businesses have successful exits and the market looks positive, it might get more people interested in IPOs again. Businesses that got support from venture capitalists might see going public as a good next step for their growth. So, there’s hope that a friendlier market will encourage more IPOs, giving investors their money back and encouraging more investments in new businesses. Liquidity is what the broader venture capital market desperately needs these days.

• GapMinder VC is a Romanian venture capital firm focused on seed and Series A investments into local and regional startups that have the potential for global expansion in IT software and service-related sectors.
• The investment strategy of the fund is to support deeptech startups at seed and late seed stages, making first investments of up to €2.5 million, with significant follow-on capabilities. The fund became active on February 14th after its first closing and will shortly announce its first transaction.
• It was raised with the support of the European Investment Fund (EIF) and the European Bank for Reconstruction and Development (EBRD). The capital injection consists of two parts:
  • EIF supported GapMinder Fund II with an aggregate of €30 million via two initiatives, namely the European Union program InvestEU and the Recovery Equity Fund, part of The National Recovery and Resilience Plan co-financed by EU via Next GenerationEU. 
  • EBRD invested €10 million in this fund. This is the first investment of EBRD in a fund launched by a team of Romanian partners.
• According to the fund, it aims to support startups from Romania, Moldova, Serbia, Croatia, Slovenia, and Bulgaria, operating in the fintech, cybersecurity, enterprise automation, and data/analytics verticals.

• The Kyiv-based firm exceeded its target size of $250 million by 40%, while also concluding three attractive investments during the fundraising process. Previous expansion to $298 million was made in September, 2023, while the first closing was a year prior, bringing $125 million.

• The Fund invests growth capital alongside visionary entrepreneurs leading fast-growing tech and export-oriented companies, as well as select domestic champions, in Ukraine and Moldova, with a pipeline of over 80 investments.

So far, Horizon Capital has invested in three Ukrainian startups, namely Preply, GoIT, and Vivesen.

Who are the LPs?

HCGF IV is backed by investors with a combined capital base of over $700 billion, including international financial institutions FC, EBRD, EIB through its EUfor Ukraine Fund, DFC, DEG, FMO, JICA, Proparco, SIFEM, Swedfund, Finnfund, WNISEF, IFU, joining forces with global institutional investors, foundations and family offices.

The private investors include funds managed by abrdn, Blue Earth Capital, Zero Gap Fund, an impact investing collaboration between The Rockefeller Foundation and the John D. and Catherine T. MacArthur Foundation, Marcin Zukowski, Co-Founder of Snowflake, Andy Kurtzig, Founder and CEO of JustAnswer, investors and philanthropists George and Rayla Myhal, and other esteemed Limited Partners.

• Horizon Capital is a private American investment company with a total capital of $1.6 billion that invests primarily in technology and export-oriented companies in Ukraine.
• The agreement to raise $20 million from Japan’s JICA was signed during the Japan-Ukraine Economic Reconstruction Support Conference in Tokyo on February 19.
• This is the first investment Horizon Capital has received from Japan. Thus, the country joined the base of investors from the United States and Europe with a total capital of about $700 billion.
• The investment is aimed at promoting the global growth of innovative technology companies of Ukrainian origin and expanding their research and development platforms.

Horizon Capital Growth Fund IV (HCGF IV) was established in September 2022 to promote the development of technology and export-oriented companies in Ukraine and Moldova.

JICA is a Japanese government agency that administers international aid to developing countries and advances international cooperation. To promote sustainable development and security in partner countries, JICA provides technical assistance, grants, loans, and training programs. JICA has 96 offices abroad and operates in about 140 countries and regions around the world.

Why is this important?

On February 19, 2024, it was also reported that Japan would allocate €1.25 billion to support Japanese investors in Ukraine. In addition, the two countries signed a convention for the avoidance of double taxation, which should simplify the operations for businesses. 

Japan also pledged to provide $12.1 billion in aid to Ukraine, including a $4.7 billion grant that they intend to allocate by the end of this month. This commitment shows extended support from the Japanese government that will help negate the economic impact due to Russia’s full-scale invasion of Ukraine.

• The €35 million (PLN 150 million) capital commitment is part of the PFR VC Hub program and comes from the Polish Development Fund’s budget. The first agreements were signed at the end of 2022, and the last one in early 2024.
• All investment teams have a well-established presence in the Polish market, with three benefiting previously from PFR Ventures’ support through European Union-funded programs. Funds with PFR Ventures as a Limited Partner are poised to significantly invest in the nation’s innovators, earmarking over €162 million (PLN 700 million) for Polish companies.

With the development of the Polish venture capital market, our offer is expanding. A few years ago, we made a decision to also finance the best Polish teams with PFR funds. We want the managers to have access to capital that gives greater flexibility in terms of investment strategy,

Paweł Borys, President of the Polish Development Fund, says.

The four teams who received the funding

Market One Capital is a Poland-based generalist venture capital firm investing across the whole of Europe. The firm manages the second fund with a target capitalization of about €80 million. Market One Capital funds have in their portfolio such companies as MetaGravity, ConnectEarth, and METYCLE.

The fourth team’s name remains undisclosed. However, it will focus on financing companies in the growth equity phase from Poland and Europe. It is managed by a group of experienced managers, and the target size of the fund is similar to the other funds in the PFR VC Hub portfolio.

• Currently, the SMG Capital fund has managed to raise almost 50% of the planned amount from the own funds and from its partners. It was created on the basis of three venture funds from the USA, Europe, and Ukraine.
• The investment focuses on companies with Ukrainian founders, focused to scale and develop in the US market. In total, the team plans to invest in 100 early-stage tech startups.

In addition, we are currently launching a three-month program for Ukrainian startup enthusiasts. Its purpose is to provide participants with the necessary knowledge, skills, and resources to successfully launch their own startups, join existing projects or form teams for future startups,

Oleksandr Shinkarev explains.

SMG Builder offers the following opportunities for startups:

• an investment of $25,000;
• the opportunity to become a co-founder of a startup;
• a chance to find a team to launch a startup;
• a recommendation for completing an internship from an international company.

Future partners of the builder can become startup co-founders, mentors, or consultants to help them enter the US market.

• Full Speed Ventures was founded by seasoned industry veterans Wojciech Fedorowicz and Daniel Star The firm brings decades of experience in technology investments to the table, providing insightful, practical guidance to the portfolio companies.
• The second fund will focus on tech founders, making a very small number of selective investments, where it can provide extensive, practical and execution-focused support.
• According to the fund, its small portfolio allows to dedicate substantial time and resources to each company. This strategy also enables them to provide funding for both initial and follow-on investment rounds.

Our approach is about being hands-on, acting as an extension of our portfolio companies’ teams, and guiding them through every challenge and opportunity. With this second fund we target early-stage companies with initial revenues, ready to conquer their sectors,

Full Speed Ventures representatives commented on the launch.

• Typically, the fund invests €1-2 milllion as a first ticket and continues supporting the company across CEE with a strong connection to Poland.
• The firm is based in Warsaw, Luxembourg, and Tel Aviv. Since the launch, Full Speed Ventures have made a number of investments in the areas of cybersecurity, medtech, AI, and consumer, including AVG, Backweb Technologies, Callpage, Cosmose AI, tylko, and others.

• 3TS Capital Partners, a technology-focused growth capital firm providing expansion capital primarily across the TMT sectors including Technology & Internet, Media & Communications, and Technology-Enabled Services.
• The firm’s team consists of 18 people across eight nationalities based in Finland, Austria, Bulgaria, Luxembourg, Czechia, Slovakia, Hungary, and the US. 3TS has made more than 50 investments and over 30 exits, including LogMeIn, H88, Systinet, Avangate, SolveDirect, Tresorit, and SalesManago.
• The current and past 3TS funds totaled at over €450 million. The LPs included EIF, Tesi, SZTA, Erste, Cisco, OTP, EBRD, AWS, Sitra, KfW, and 3i among others. 

About the new Fund IV

• The new fund has already invested in five companies: (TosiBox, Autenti, Boksi, Spectrm, and Jentis). 3TS focuses on investment across ICT and tech-enabled service sectors with the amount of €5-20 million. With the new Fund IV, 3TS focus will remain on backing companies with roots in Engineering Europe.

We are delighted and thankful for the increased capital commitments in our new Fund IV from existing and new investors. We are still in the early phases of digital adoption and the key trends driving our focus sectors stronger than ever. Tremendous opportunities will continue to exist for innovative companies. We look forward to supporting a new generation of management teams building local leaders, regional champions and global challengers,

Pekka Mäki, Managing Partner of 3TS, commented on the fresh deal.

Several groups of institutional investors including European Investment Fund, Tesi, SZTA, a venture capital firm headquartered in Budapest, Erste Asset Management, an international asset management company, as well as several family offices and former portfolio company executives, supported the final closing of the fund.

AIN.Capital talked with ZAKA VC’s Co-Founder and Managing Partner, Jan Kasper about the fund’s activities and success stories in 2023, as well as further plans and predictions for 2024.

You can read the interview below:

Tell us about ZAKA VC. Who do you invest in, how much, and at what stages?

ZAKA is one of the most active VC family offices in Europe. We have an agnostic approach, with strong focus on software solutions across multiple business sectors as well as on scalable health and biotech solutions.

Our primary focus is on pre-seed and seed, but we are always happy to assess startups even in the earlier stages. Geographically speaking, our portfolio startups are active on all continents, but our activity is oriented primarily on Czechia and Slovakia, the Baltic countries, and the UK.

In 2023, which was also ZAKA’s fourth year, you had closed 20 new investments. Can you tell us more about these deals?

With a strengthening network in the health & biotech sector, startups in this segment dominated our new investments in 2023. I will mention, for example, ExcepGen (where we became a co-investor together with Y Combinator, RA Capital Management, and Sam Altman’s Apollo Projects), Olio Labs, Medisearch (both also backed by Y Combinator), or Eigen Therapeutics (backed by First Round and Alumni Ventures).

Outside of biotech, there were, for example, Spanish-based Webel (service marketplace), Austrian-based Tripmakery (group booking platform), or the Czech startups Cruxo (retail media platform), and Sharpgrid (DataTech in On-Trade and Hospitality).

What startups in the 2023 batch impressed you the most so far, in regards to their team, product, or growth?

All of the startups in biotech sector have made some major progress since our investment – however, these are not measurable in MRR or CAC/LTV. All of the teams are working hard on proving their concept, IP registration, crucial partnerships, etc. Among the non-biotech startups, Webel and Tripmakery are proving on monthly basis that they “hit the nail on the head” and perceive a growing demand for their products. 

Can you share with us the proudest moments of 2023 that you’ve experienced at ZAKA VC?

We are very proud of the yearly progress that we have made – our know-how, energy, and investment opportunities get stronger every day.Not even once in the last year did we think about the fundraising crisis; we have rather perceived it as a stronger opportunity to invest.

Given you have a diverse geography portfolio, what did you find most challenging about the startup and VC market in 2023?

As mentioned earlier, where others see challenges, we see opportunities. Our independence and EU-wide activity allows us to perceive the situation on different markets which has led to a stronger focus on the Baltics and the UK. These are the countries where we see many success stories and a strong ecosystem development.

Did you face any challenges yourself?

One of the challenges is the precising of our assessment process – continuously shaped by tech innovation, market development, our network, and increasing knowledge.

With the arrival of 2024, what plans or expectations does ZAKA have for this year?

We want to continue growing and investing even more. We are eager to learn and to be better every day, which we are working hard for. We are also taking steps to prepare a new fund in 2024. With fund size between €12-15 million it will be based in Prague and focused on pre-seed and seed phase, active in the Baltic region, UK, and extended to the US.

This is the first time we are opening our investment instrument to other investors – our future Limited Partners.

By judging the market last year, can you share any predictions for the near future?

We are in the era of increasing implementation of artificial intelligence which has a massive influence on how people live and do business. Generation Z people think, act and work differently. All the startups which leverage these changes in business (sustainability, edtech, healthcare, biotech, mobility, etc.) gain a strategic advantage. We believe that VC activity will largely copy these trends.

What tips would you give promising startups in the region who want to raise capital from investors or, in particular, ZAKA VC?

• Keep yourself concentrated and motivated and also, keep your mind clear.
• Be ready to easily explain the problem you are solving as well as why your solution and your team are the best to solve it.
• When fundraising, do your math. Prepare your argumentation for the round size, valuation, market size, pricing strategy, and your unit economics.

About the fund

• The new fund will invest in cleantech startups in the Baltic and Nordic countries, but at first, it will focus on helping out Estonian companies. 2C Ventures will focus on startups developing new technologies in renewable energy, waste reduction, water management, circular economy, and other clean technologies.
• Initially, investment per company will range from €250,000 to €1 million, depending on the development stage of the company. According 2C Ventures, it aims to help the world tackle climate change, improve capital availability for cleantech companies, and establish climate-neutral economy as a competitive advantage for Estonia.

2C Ventures will be managed by four partners:

• Herty Tammo, the founder of Startup Wise Guys;
• Hendrik Reimand, the former investment specialist at Livonia Partners and head of finance of the Estonian Katana Technologies;
• Taavi Veskimägi, the former Minister of Finance and CEO of Estonian electricity and gas TSO Elering;
• Martin Koppel, the co-founder and CEO of Fortumo.

Research intensive companies, especially those with a hardware component, are key to developing new technologies to address climate change. However, such companies have a longer development cycle and are more capital intensive than software start-ups, which is why they have had a much harder time raising external capital. We see many strong teams with ambitious ideas in Estonia and the nearby countries and we want to help them reach the global market,

said Hendrik Reimand, a partner of 2C Ventures.

• SmartCap, the Estonian state investment branch, invested €20 million in 2C Ventures fund as an anchor investor. Other investors are mainly Estonian entrepreneurs from the technology, energy, construction, and forestry sectors.

• The majority of the fund was raised with private money amid investment slowdown.
• The fund wants to invest in over 20 early-stage startups founded by Eastern European founders who have global ambitions, with an average investment ticket of $500,000.
• It has already finalized 7 investments in Romania, Croatia, Serbia, and the broader Eastern European diaspora: Nestor, Goodlegal, Videowise, Veridion, Turneo, Sera, and an undisclosed deal.

In 2022, AIN.Capital wrote about the launch of the Underline Ventures first fund. Back in July that year, the fund managed to get half of its targeted $20 million. You can read more about the launch, here.

AIN.Capital talked with Reima Linnanvirta, Partner at Trind Ventures, about the fund’s activities and recent investments in an interview, where he also shared his thoughts on the Baltic VC and startup market.

Tell me about Trind Ventures. What is the fund about, what startups do you invest in?

Trind Ventures is a seed-stage venture fund focusing on European software startups. We are currently investing from our second fund, which is a €55 million fund we launched in 2022, exactly a year ago. And we focus on companies with a consumer or community component, so typical examples are marketplaces, platforms, and anything with many users. Geographically, we invest all over Europe, with the core region being the Nordics and Baltics.

Can you tell me about the second fund’s performance since its launch in September 2022?

Well, it’s still so early, you can mainly measure how much you have invested. Our goal was to make 8 to 10 deals per year. By now, we made 11. So we are pretty much exactly on schedule. The big plan is to continue investing the same for the next three years and aim to build up a portfolio of between 30 and 40 companies, probably ending up closer to 40.

Is it too early for any exits?

No, no exits. So far, only one company has had a follow-on funding round. In Fund 1, we have had two exits, both positive. But in regards to Fund 2, no exits yet. 

If you have an early exit, you know it’s not going to be the best story for the fund.

Did any startups surprise you with their growth since the investment? 

In Fund 1, the best-performing startups have been Ready Player Me, which attracted Series B round led by Andreessen Horowitz. There is also Neural DSP that has been growing really well and attracted a lot of attention recently. Jobilla has been expanding quite nicely. All in all, I would say that in Fund 1, there’s five companies that are performing well. Those are the highlights. 

In terms of Fund 2, Webel is the one with the best performance so far. It is also the one that we did a follow-on investment for. So it’s been developing nicely since the first investment. 

2022 seems like quite a time ago. Have there been any changes in your investment strategy since the fund’s launch?

No, but we have seen this shift in the market, and that sort of works in our favor. We have always been a conservative and quite data-driven investor. And when the market overheated, there were quite a few deals that got funding without any data. They were just a great story and great founders, so they were able to raise funding. 

Now we see more and more that there is increased attention to traction, you have to check customer acquisition and retention. I would say that the market is getting back to normal, which makes it easier for us to invest within our thesis. We didn’t need to make any changes.

Since the start of autumn, you have had four deals announced. Can you tell me more about them? 

In the last four weeks, we have had four investments already; pretty busy during summer:

• Webel — we made the first investment in December last year. A very small ticket. It was an early-stage deal, but they had a great team and promising metrics. We wanted to see how it develops. And it’s been developing well. So, recently, we led a follow-on investment, which was a €2.1 million round.
• Boksi — is also from Fund 1, so it was another follow-on investment. Boksi is a Finnish influencer marketing platform connecting influencers and brands who want to perform influencer marketing. So that A-round was led by 3TS Capital Partners together with Nexit Ventures, and we participated in it.
• Your.Rentals — is a Danish company providing a short-term rental marketplace. It’s a platform for those who rent apartments out, where they manage the property featured on Airbnb, booking.com, and others all in one place.
• Wudpecker — is from Tampere, Helsinki. They are providing knowledge management solutions. Their main product is the automated note taker, which can take notes and make automated summaries of calls and meetings. It’s a very, very passionate team and they have really nice product growth going on.

Earlier, you told us that the market is coming back to normal. Can you tell me more about that?

I’m actually saying that this, what we are seeing now, this is the normal. In the past few years, the market has overheated, and we have forgotten what it’s like to be normal. I’ve been working in the venture capital industry since 2006, and this, in my view, is not downturn. This is what we saw in the big part of the 2010s before it got overheated a few years ago. 

A year ago, we were in a situation where some companies had cut down their burn and postponed their funding rounds because of the positive cash flow. There were deals around, but those investment opportunities were not necessarily good investment cases.

Last spring, those quality cases started to fundraise, and this summer was super busy. And that’s the reason why we have had so many announcements lately — those deals that we were doing during summer are finally public. 

Investors tend to prefer deals with a bit longer runway. So instead of going for 12 months, it’s 18 to 24 months. It means that the rounds are bigger, and the plans are less aggressive. And it also means that instead of a single investor, there are two or three joining the round. It’s true in the Baltics, and the same happens in the Nordics, even in Southern Europe.

Do you have any pieces of advice that you would give founders or VCs in the area?

From the VC point of view — stick to your investment thesis whether it’s a good time or bad time. If you follow your thesis, regardless if the market is hot or cold, you can still make good investments.

Regarding founders — I would put an extra effort into understanding what the investors seek. One thing that I noted when I participated in Latvia Startup Day, where we had four VCs on the table — everyone had different viewpoints. So, understand how different VCs are thinking. One thing that we all love is how well the founders are prepared. We love data. So, the better the data regarding the company, the easier it is to analyze it and invest in the company.

Can you tell me more about your Trind VC plans? Do you plan to invest in more startups this year?

We plan to do 30 to 40 investments from the current fund. That means we still have to do some 25 deals. So far, we have had 11, but we have something in the works as we speak. There are a couple in the closing stages. I expect that we will still announce something new this year.

AIN.Capital had a chat with Andrus Oks, a Founding Partner at Tera Ventures, who told us about the fund’s activities, future plans, as well as shared his insights about the state of the Baltic market in 2023.

Tell me about Tera Ventures in general. What is your focus? What are the funds under management? And what do you provide to the market?

We are a VC seed fund investing out of our €45 million 2nd Fund. We are investing from pre-seed to late seed. And we have been investing for 15 years and, essentially, from the beginning, we’ve both been a generalist investor but also developed themes. We’ve been investing in AI and Machine Learning for more than ten years. That’s our main theme.

In terms of industries, as we have this high conviction hands-on model and some of our portfolio companies mature, we get to learn about their respective industries. And that has enabled us to actually learn from the feedback quite a bit. We were the first investors in Monese, the neobank.

And learning from them has enabled us to understand this space more. We have several successful Fintech portfolio companies. And that is our main focus: we are looking for anything within digital and hardware, which is also an interesting topic for us. But yeah, the core needs to be digital.

• We cover our home market in Estonia, as most of our companies are here, but we also cover Scandinavia, rest of the Baltics, Poland, and Czech Republic.

In our 2nd Fund, we have three LPs from the US, two from Japan, most are from Scandinavia. The most notable strategic investors are Perot Jain in the US and Itochu in Japan. Because these investors are interested in direct deals, commercial collaboration, they act as softlanding partners for companies. And this is very valuable for the portfolio companies, because the need for help entering other markets is usually the primary need that we can help with.

That is also my next question. Apart from the funding, do you offer any support or expertise to the startups?

Yes. All our partners are previous founders. We’ve actually been in their shoes. We understand what their needs are. Every startup is different. We can provide many things, whatever they really need at what time. 

And as I said, usually, the primary need is going to larger markets. That’s where we have focused on our value add. Notably, we have one of our partners, Eamonn Carey, actually living in London. That’s a well-positioned area to offer help from: connecting the startups to various networks and helping raise money from later stage investors.

What about the fund’s performance in 2023? How many investments have you made? Have there been any successful exits?

The public data is not actually reflective of the whole transaction history of this year. We’ve actually done several more deals that haven’t been announced yet. 

Several portfolio companies have certainly exceeded our expectations, we have had 6 uprounds in recent months. And two companies raised proper Series A investments. One of them has been made public recently — AI Clearing, a US/Polish construction tech focused company.

However, the year has not ended yet, there still might be news.

It’s a tough market, but it’s actually a really good time to invest right now. In the beginning of summer, we were kind of concerned because everybody’s saying the market is really tough. And well, we thought, let’s see what portfolio companies would need to raise funds. And what would the outcome be? But it has actually been very successful. They are truly impressive.

Recently announced investments include Cino, Avokaado, and AI Clearing. Tell me more details about these deals. How did you meet the founders? Why did you decide to invest?

Yeah, so, let’s take it one by one. 

• AI Clearing — I guess it’s one of the more interesting stories. They actually reached out to us. They’re an amazing team also from a promising industry, who concluded the first PoC with one of the top 10 US construction companies, PCL. Before raising the $14 million round, they had successful partnerships, rapid revenue growth, and offered very impressive innovations in general.
• In the case of Avokaado — we’ve actually known the founders for several years already. During the last year, they came up with this new product called aDoc. Instead of usual PDF-based contracts, they’ve actually built a completely new system where contracts are actually either fully digital or digitized. A year ago, Avokaado started getting customers to use this new aDoc product. All the initial feedback was very positive. So, that’s why we decided to invest in them. 
• And in the case of Cino, it’s my partner Stanislav Ivanov’s company. We are their first investors, and decided to invest exactly a year ago. At the time, it was a pre-revenue deal. They launched their product in April, and it was obvious from the beginning that the users really, really loved the product. That’s why we decided to lead the next round as well.

You told us that you thought the market would be a lot tougher this year. Were there any changes in your fund’s investment strategy?

No, not really. What has really changed is that the deals are more reasonable, and round sizes are smaller, valuation expectations are lower, or more palatable for investors. There is also more time to think about the deals. If you have more time, you’re probably doing more due diligence, and making better decisions. 

But the main struggle is still the same. It’s always the same. Where do you actually find those founders that are able to disrupt their industries and then become the global leaders, right? So, even though the Investment environment is currently better for investors, the challenge to find those founders is still the same.

How did you adapt to the pandemics and other crises on the market? Are there any differences or notable changes with today’s situation?

The pandemic feels like ancient history already. This current crisis actually started from the public market. And it’s harsh in a sense that many other investors pulled out of the market. Especially, in regards to later stage deals that are much more difficult to do. 

From my perspective, obviously, we were concerned about this harsh market for our existing portfolio companies, can they raise the next round? But as I said, they’ve actually been very impressive. However, it’s easier for investors to do new deals. 

In our initial investments, we’ve actually quite enjoyed this new situation. This is what we also heard from other investors as well. This current year may be one of the best vintage years for VCs.

Can you give any general advice for startups in CEE? What is the main thing for them to look for if they want to, for example, get financing from your fund?

It’s very easy — come and talk to us. We’re very open to talk to everybody. I don’t think you need to hack investors or learn hustle methodologies. Just come and talk about your business. That’s what we do. In case it’s in our strategy, we will invest and help you move forward.

And can you tell me about the fund’s future plans? Do you plan on launching new funds or making future investments?

Yes, we have started preparations to raise our next fund. We’ll continue with the current strategy pretty much, it will be a meaningful evolution from the current strategy. We are increasing our value-add, engaging more venture partners. We are building more substantial relationships with venture partners who are here to engage with team flow and actually help our portfolio companies.

We will do another two or three deals this year. We will also do a few follow-ons.

Did you want to share anything else with our readers?

Yeah. Regarding the current market state. I’ve heard that many people are really concerned about it. Although it is certainly tougher to convince someone to invest, you shouldn’t let the situation discourage you. I think entrepreneurial creativity is the main thing that is driving the whole economy. Great founders always find ways to keep growing or how to raise funds.

Actually, this funding environment may be different depending on the place. Even in your country or in your city, it’s difficult to grow, there are places where the situation is different. 

I recently had a call with a Berlin-based seed stage investor. He said that what they are experiencing in Berlin, in Paris, and I think it’s happening in London as well, is that most of the later stage investors don’t really want to do many Series A deals. They dropped down to seed stages. This means that in the seed stages, from this investor perspective, there’s more competition. And it’s tougher for them to invest in those cities, which means that for startups, obviously, it’s easy to raise money. If you’re somewhere in Europe, you should actually consider reaching out to those Berlin and London investors. They enjoy deals from other regions where competition is lesser. 

And of course, it matters about what the startup is really doing. If you’re in climate tech or in generative AI, these markets are certainly hot right now. In general, I guess, the disruption we will see from generative AI will be much bigger compared to anything coming from this challenging funding environment.

AIN.Capital spoke with Krzysztof Przybylak, a HealthTech investor at Inovo.vc, about the fund’s activities, investments, exits, and the details about future investments.

Tell us about Inovo.vc.

Inovo.vc is one of the oldest and largest VC funds in Poland. It has had three funds under management:

• Inovo I — vintage 2014 — size €8 million.
• Inovo II — vintage 2018 — size €54 million.
• Inovo III — vintage 2022 — size €100 million.

The fund’s main focus is:

• Central and Eastern Europe + diaspora.
• Preferably Seed stage (occasionally Pre-Seed / Series A).
• Ticket range: €500k to €4 million.
• Industry agnostic fund with special focus on healthcare (7 portfolio companies) and AI/ML/developer tools (8 portfolio companies).

The fund’s partners are:

• Tomasz Swieboda, an ex Investment Banking at Rothschild and ex Private Equity investor at Penta. Today he runs our Founders Club.
• Michał Rokosz, an ex McKinsey and Rocket Internet. Focused on B2C startups
• Maciej Małysz, Kauffman Fellow focused on ML/AI and developer tools.

How is Inovo.vc’s performance in 2023?

January 2023 — June 2023:
• new investments: 6 (Inovo III fund).
• follow-ons: 4 (Inovo II fund).

July 2023 — today:

• 1 new deal signed (Inovo III fund)
• 2 new Term Sheets currently in the process of signing (Inovo III fund)
• 1 follow-on (Inovo II fund) — AI clearing.

So to sum up, we did 9 new investments year-to-date.

Some of them are not publicly disclosed yet. The ones announced are: Embla, FiatRepublic, Pupilmed

Were there any successful exits yet?

• We have successfully exited most of our portfolio companies from Inovo I.
• Fund II and Fund III are too early for exits.

Given Inovo.vc’s activity, how many investments are still planned for 2023? What is the focus of your further deals?

We plan to invest around €15 million a year in new companies. We are still able to invest in 2-3 new companies this year.

About the CEE market: Are there any notable differences in the CEE VC and startup market this year?

We can see in Poland that pre-seed/seed rounds are about 20% below the number of previous year (in terms of number of transactions) and there is a significant decline in later stage rounds (Series A and later).

Has anything changed in Inovo.vc’s approach to investments recently?

Our Inovo I fund was focused on Poland only, with the recent funds we do more effort to cover other Central and Eastern European countries too.

Does Inovo.vc experience any effects due to the harsh geopolitical climate (War in Ukraine in particular)?

We can definitely see more Ukrainian diaspora founders in Poland and other countries since the war started.

Two of the most recent rounds joined by Inovo.vc were AI Clearing and Embla. How did the deals come to be? And are you planning to invest in other diaspora startups?

AI clearing — we invested in this company back in 2020, the founders made significant progress since then so the Series A was fully deserved. They were very international from the very beginning.

Embla — we had a thesis on the weight loss market, especially startups combining GLP1 drugs with behavioral therapy. We were actively searching for startups in this space and we got introduced to Embla’s founders from our friendly VC later-stage fund from London. After the initial meeting it was clear that this is the best startup we have seen in this space.

Regarding diaspora — yes, we are actively looking to invest in more diaspora startups.

On a personal note, can you tell us about the specificity of the healthtech investments made by Inovo.vc? Did the industry experience any changes in terms of volume and the number of deals?

• We believe that Poland has one of the strongest healthcare startup ecosystems in the CEE region with over 100 startups founded here.
• We did 2 pre-seed stage healthcare investments in Poland this year and 1 Series A outside of Poland (Embla).
• Similarly to other sectors in Poland, we can see that the number of pre-seed /seed startups is high, but there aren’t that many at Series A or later.

In your opinion, what can you advise to startups or their founders who want to secure financing from Inovo.vc in the future?

It’s difficult to give general advice, every startup is unique in some sense. What helps getting funding from Inovo.vc is knowing your customers inside out and having huge ambitions (market size $1 billion or more).

• BaltCap is an independent private equity investor that focuses on small and mid-market buyouts and expansion capital investments. Recently, AIN.Capital ranked BaltCap as one of the 19 most active Baltic VC funds in H1 2023.

• The new fund will continue the strategy of BaltCap Infrastructure Fund I, with a goal of financing infrastructure projects with positive environmental and social impact. BInF II will primarily focus on investments in renewable energy projects such as wind farms, solar parks, biomass and biogas plants.
• It will also continue to help local municipalities increase the energy efficiency of their buildings as well as provide essential services, including establishing and renovating schools, public facilities, and other social infrastructure.

“The Baltic countries and Poland are facing an infrastructure funding gap of €250 billion over the next 7 years. With the backing of international institutional investors, BInF II will seek to address this gap and finance infrastructure projects that increase energy security and contribute to climate change mitigation,”

Simonas Gustainis, Managing Partner of BaltCap, said.

• The lead investor of BInF II is the European Investment Fund (EIF). One of the largest Swedish banks Swedbank, Nordic bank SEB, Estonian banking and financial services company LHV Pension, and Latvian Citadele group, also joined.

• Initially, the fund’s amount was supposed to be $125 million. But almost immediately after the news, the company announced that the amount of the fund would increase.

• In April 2023, the company reported that the volume of the fund amounted to $254 million.
• The current volume of the fund is $298 million. This is 65% more than previously planned, the company said.
• The funds will be invested in the next 4-5 years in companies in Ukraine and Moldova. A significant share of investments is planned to be directed to the technology companies.
• At the same time, this is not the final amount. Horizon Capital said it will continue to work with potential LPs until the end of December 2023, after which the fund will be finally closed.

• The fund will invest in seed-stage companies with mission-driven entrepreneurs from CEE dealing with climate, education, and healthcare solutions, having a sustainability-focused impact.
• Among the countries that the fund targets are Bulgaria, Czechia, Hungary, Poland, Romania, Slovakia, Estonia, Latvia and Lithuania.
• A typical investment ticket provides an initial equity or convertible debt funding of up to 1.5 million euros and has a one to seven years’ investment horizon.

About Tilia Impact Ventures

• Founded in 2018, Tilia Impact Ventures backs CEE founders in solving meaningful social and environmental problems at scale. The firm’s focus is on climate, health, inclusion, and education tech. Tilia Impact’s inaugural fund invested in Czech IT company DatLab, Hungarian startup Munch, Polish alternative pre-school e-platform The Village, and fashion platform Nold.

” ‘Systemic change’ is the key concept for us. We are investing in technologies and business models which can transform entire industries and systems, rather than only bringing temporary benefit,”

Andrew Gray, general partner at Tilia Impact Ventures, said.

• Major investors in the second fund are the European Investment Fund, via the InvestEU program, as well as Ceska Sporitelna Bank, part of Austria’s Erste Group. The fund also attracted a number of prominent Czech businessmen like Libor Winkler of RSJ, Zbynek Frolik of Linet, Ondrej Bartos of Credo, Jan Barta of Pale Fire Capital, Tomas Vala of Siko, and Vaclav Kurel of Benefit Plus.
• The fund is already in advanced negotiations on several deals, which are yet to be announced.

• NordicNinja Fund II is the largest joint Japanese-Europeand fund in Europe backing companies tackling the world’s carbon footprint.
• Fund II will continue to invest in early-stage, Series A and B founders driving impactful change in sustainability and the digital society. The average investment size will vary between €2-8 million.
• It will offer also support to European founders from an experienced Japanese-European team of founders, engineers, and operators turned investors, and access to a global network of 120+ blue chip Japanese corporations.
• Following demand, the fund is now expanding its operations to the UK, Ireland, and BeNeLux countries, while doubling down on the Nordics and the Baltics.

“At NordicNinja, we’re looking for founding teams creating companies that have the potential to become leaders in their fields, solving the most pressing global challenges such as climate change and healthcare crisis. This takes more than just capital. Collaboration on a global scale is at the heart of this fund, building bridges of knowledge, experience and ambition so that we can become greater than the sum of our parts and create a better world to live in for all,”

Shinichi Nikkuni, Managing Partner at NordicNinja, comments.

About NordicNinja

NordicNinja is a founder and operator-led VC fund helping world-beating teams solve society’s hardest problems with the most innovative tech. Founded in 2019 as a Japanese-European joint venture between JBIC IG Partners and BaltCap, NordicNinja is managed by Tomosaku Sohara, Shinichi Nikkuni, Marek Kiisa, and Rainer Sternfeld.

To date, NordicNinja has made 20 investments, three of which became unicorns. From its €101 million Fund I, NordicNinja invested in Bolt, Einride, Veriff, Voi, Starship, ClimateView, Kognic, Mavenoid, Pactum, Varjo, DappRadar, and Ready Player Me.

• Merito Partners is a private investment company operating in Latvia and the New Nordics. The fund focuses on implementing growth capital, sustainable energy, and specialized real estate investment strategies. Earlier, it launched its Sustainable Energy FUND I with a total target size of €20 million to develop solar power plants in Latvia.
• Currently, Merito Partners has successfully raised almost €5 million in capital from over 10 Latvian investors and actively continues to fundraise. In addition, the fund plans to increase its total value to at least €10 million.
• Merito aims to acquire its first property and convert it into a self storage facility in the upcoming weeks. The average size of each self storage unit will range from 4 to 6 square meters. The network will consist of at least 10,000 units.
• Currently, the fund is negotiating acquisitions of more than five separate properties throughout the Baltics. The network of self storage facilities will be developed in Riga, Vilnius, Kaunas, and Tallinn.

• Founded in late 2022 by Dr. Terhi Vapola and Kaisa Hietala, Greencode Ventures invests in the most ambitious and impactful digital-first green transition startups from seed to series A+, primarily in Europe and Israel. The fund’s priority industries are green energy, green mobility, and green cities.
• The fund’s backers include Business Finland Venture Capital, Nordea Life Assurance Finland, Pohjola Insurance, OP Life Assurance Company, Konstsamfundet Ventures, Kelonia, Stephen Industries, Atavus, Nidoco, Halton Ventures, Ikorni Invest, Tre Smeder, KJL Consulting and other experienced LPs.

Greencode Ventures has already made its first investment through the fund. The firm invested in Supercritical, a cutting-edge marketplace for carbon removal, during its €13 million Series A round.

• The NATO Innovation Fund is the world’s first multi-sovereign venture capital fund that will invest in innovation technological startups to address critical defense and security challenges.
• The Fund’s Limited Partners include 23 NATO Allies: Belgium, Bulgaria, Czechia, Denmark, Estonia, Finland, Germany, Greece, Hungary, Iceland, Italy, Latvia, Lithuania, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Spain, Türkiye, United Kingdom.
• Sweden also showed desire to join the NIF, and its participation will take effect upon its accession to the North Atlantic Treaty.

“As a member of NATO, Sweden will contribute to the strength of the Alliance, not only through our geostrategic location and military capabilities, but also through a vibrant security and defense industry that promotes innovation and development of cutting-edge technology. This is further enabled through participation in the NATO Innovation Fund,”

Minister for Defence of Sweden, Pål Jonson commented.

• The Fund will make direct investments into startups located in these countries, and indirect investments into deep tech funds with a trans-Atlantic impact. NIF adds that it aims to secure an enduring future for the Alliance’s 1 billion citizens. 
• In July this year, Polish Development Fund also joined the NATO Innovation Fund, investing €42 million through its investment arm PFR Ventures. The investment was made in consultation with the Chancellery of the Prime Minister and the Ministry of National Defence.

• TCF Capital will focus on profitable late-stage companies in the e-commerce, fast-moving consumer goods, and logistics sectors from the Czech Republic, as well as otherCentral and Western European countries.
• According to the fund’s website, the total value of assets under management exceeds €720 million, with the Rohlik Group being the key asset. However, in the future, other investors will have the opportunity to become LPs.

• Tomáš Čupr is a successful Czech entrepreneur, who is the founder of several companies like Kifli.hu, Gurkerl.at, Knuspr.de, founder at Slevomat and at DameJidlo.cz. Most notably, he is the founder of the Czech unicorn home delivery service of groceries company Rohlik. Now, he’s using the earned capital to reinvest it into other companies.
• As of now, TCF Capital has already invested in companies such as Keboola, FlexDog, and Impact Hub.

• Founded in 2019 by Inka Mero, Voima Ventures is a deep tech firm that invests purely in startups with deep tech and scientific backgrounds in the Baltics and Nordics. The firm’s mission is to solve major global problems by combining science, entrepreneurship, and value adding capital.
• Voima’s industry domains include bio and new materials, medtech and life sciences, imaging and optics, IoT and electronics, robotics, software, ICT, and AI. So far, the firm has invested in more than 30 deep tech startups, including the most recent investments in Origin by Ocean, eniferBio, and MVision AI.

• The capital for Voima’s Fund III came from the European Invetsment Fund, Finland’s Tesi, VTT, Sweden’s Saminvest, Nordea Life, and Elo.

“We at Voima Ventures are strong believers in the fact that technology and science-based companies will form the backbone of the Nordic region’s next-generation unicorns, economic growth, and talent attraction. Even more so, we need these companies to create true impact: solve climate, health and societal challenges. The time is now,”

Inka Mero, founder and MP, commented.

• As with its previous funds, Voima’s third fund is focused on Nordic and Baltic countries, and it’s aiming for ticket sizes ranging from €200,000 to €3 million spread across roughly 25 companies.

• Established in 1994, Innova Capital has the objective of investing in controlling stakes of mid-sized companies in the CEE region. The firm has headquarters in Warsaw, as well as 134 investments in its portfolio.

“Over the past few months, we have been very much focused  on continuing to fundraise and showing the investors the huge potential of Innova’s investment strategy. We are clearly in for an intense but interesting time ahead as we look to close the seventh fund and continue working on the deployment of the capital entrusted to us. The first transaction has already been successfully completed, and we are keen to finalise the next two – which we are currently working on – by the end of the first half of the year,”

Krzysztof Kulig, Senior Partner comments.

• In May 2023, Innova made its first investment from the Innova/7 fund. The firm acquired the majority stake in NETOPIA Group, a Romanian payment services provider. To date, Innova fully divested five funds, with nine investments within Innova/6.
• The amount raised for Innova/7 represents more than 90% of the target set at €350 million.
• Innova will continue to fundraise in the coming months, while working on new investment opportunities.

• Founded in 2016 by Andris K. Berzins, Rait Ojasaar, and Yrjo Ojasaar, Change Ventures is the first pre-seed/seed VC fund with completed investments in all three Baltic states. The VC firm backs founders from Estonia, Latvia, and Lithuania.
• Since 2017, the firm has backed over 33 startups, which keeps demonstrating an ability to generate outsize startup success stories relative to the population and size of the regional economy. The third fund continues its focus on founders from the Baltic states or Baltic diaspora.

Change Ventures Fund III

• Fund III will provide initial investments of between €100,000 — €500,000 with about half the fund reserved for follow-on investments. The firm plans to further invest in such industries: software and hardware, e-commerce, AI, B2B software, SaaS and consumer businesses, etc.
• The firm will also try to take a more flexible approach toward leading investment rounds. Fund III will be co-investing alongside pre-seed funds and angel investors, occasionally taking the lead role.
• Change Ventures’ first investment through the fund was made in early 2023. Back then, Trace.Space, a Latvian spin off from Lokalise, raised $1.5 million in a pre-seed round. The startup aimed to re-invent product requirements document management software.

• Founded in 2009 by Timo Ahopelto and Petteri Koponen, Lifeline Ventures is a venture capital firm specializing in startups, growth capital, and early-stage investments across Finland’s ecosystem. The firm invests between €500,000 to €2 million, and over time it can invest up to €15 million in a company.
• Lifeline’s primary focus is on the sectors of healthcare, games, web based, and general high technology. The firm tries to support about 10 new companies yearly. So far, it has invested in 120 startups, typically being the first institutional investor in them.
• For the latest fifth fund, the fund is largely backed by pension funds, as well as some family offices and private entrepreneurs.
• In recent months, Lifeline supported several Finnish startups, including the Espoo-based biotech company Origin by Ocean, as well as the Helsinki-based VR/XR-tech company Varjo and Inven, a financial data platform.