While capital infusion into companies took a summer siesta, some venture capital firms continue to see their coffers runneth over.
Three years after raising a $500 million fund, European venture capital firm Northzone is back with what partners are calling its “largest fundraise to date” of €1 billion, or $1.01 billion, for its tenth fund.
Same for Peru-based Salkantay Ventures, which said it closed on $26 million for its first fund, Salkantay Exponential Fund. Luis Daniel Arbulú, partner at Salkantay, told TechCrunch via email that the fund is “the country’s largest VC fund” as per PitchBook and Crunchbase data.
Colleagues Natasha Mascarenhas and Ingrid Lunden also wrote about some big funds in the past week, including Oakland-based Kapor Capital, which last week also announced its largest fund to date of $126 million, and Stockholm-based EQT Growth, which closed on $2.2 billion. Lunden wrote that it is “the first fund EQT Growth has raised specifically for tech investments, and it stands as one of the biggest first-time growth funds in Europe to date.”
In addition to those, Citi announced the expansion of its Citi Impact Fund to $500 million, which represents over triple the amount of the banking giant’s initial commitment. And Eyal Ofer’s O.G. Tech raised $400 million for its second fund, while Stage 2 Capital raised $150 million for its third fund.
Michiel Kotting, Northzone’s partner in Amsterdam and London, told TechCrunch that the fund was raised “in interesting market conditions.” Northzone began raising after the market dropped but was still able to secure funding from existing and new limited partners, he said.
“The nice thing is the firm, having been around for 27 years, we’ve lived through various cycles,” Kotting added. “We delivered in spades for our LPs and have the trust of them to also perform in the current circumstances. The pool is significantly larger than before because we think the opportunity is in Europe and the East Coast in the U.S. is really starting and only going to get bigger.”
Northzone’s new fund focuses on some of the same things its previous funds were, like targeting Europe and the East Coast of the U.S. and primarily investing at the Series A and B levels with some selective seed investments. One of the firm’s most notable exits is Spotify.
What is new is that a small portion of the new funds were earmarked for an opportunity fund, Wendy Xiao Schadeck, the firm’s partner in New York, told TechCrunch. Xiao Schadeck was promoted to partner in 2021.
For years, Northzone looked at sectors for its U.S. counterpart in those that were synergistic to the ones in Europe — for example, tech, healthcare and enterprise SaaS. However, the firm is also expanding that into crypto and web3, Xiao Schadeck said.
“We're keeping an incredibly open mind for the next generation of founders to define totally new categories as well,” she added. “Creating vectors and creating new ways to deliver value to consumers and businesses is something that we're constantly kind of keeping an eye out for, especially as our sector teams also work together.”
Salkantay Ventures’ new fund is backed by a group of investors, including Dutch Good Growth Fund, Bancóldex, Capria Fund, IDB Lab and the Peruvian Fund of Funds, managed by COFIDE. Salkantay is one of the 16 investing partners in the Capria Network, under Capria Ventures.
The firm invests across Latin America, with a focus on the Andean region, in the areas of maximizing human potential, economic inclusion and sustainability.
Luis Daniel Arbulú, partner at Salkantay, explained via email that this region is experiencing “a significant gap in basic services such as education, health and financing that widens the socio-economic metrics further.” The firm is looking for seed-stage startups working to bridge those gaps using technology.
So far, the company has invested in 14 startups, including Minu, Sang, Leal, Aprende Institute, Manzana Verde and Migrante.
He also said the fundraising environment was a bit of a challenge. As such, the firm decided to start small.
“We started with a small close to make investments to prove to the LPs that both our seasoned team, though managing the first-time fund, and our thesis could bring early success signals,” Arbulú added.