OTB Ventures heads for EUR 150m-plus final close of second fund next month

Fundraising for the new vehicle could close at just over EUR 150m, Niewinski said.

The VC firm raised EUR 140m in the first close of its second fund, OTB Fund II, in November. It has already made four investments from the fund, including its participation in Washington, DC-based climate tech startup Hydrosat's USD 15m Series A round last month, the executive said.

OTB Fund II seeks to invest an initial EUR 1m-EUR 7m in startups working in four "deeptech" verticals: spacetech, AI and automation, fintech, and cybersecurity, he said. It aims to acquire a 10%-15% equity stake by participating in late seed, Series A or Series B rounds, he said.

The fund can invest in companies based anywhere in Europe, although it naturally leans more towards opportunities in the Central and Eastern Europe (CEE) region given its offices in Amsterdam and Warsaw, Niewinski said.

The team aims to make 2-3 more new investments this year and targets 5-6 annually, he said.

OTB Fund II follows the firm's first USD 140m OTB Fund I, which was first launched in late 2017, Niewinski said. The first fund made 15 investments, including Finnish satellite imagery provider ICEYE, UK-based work-related injury prevention platform Soter Analytics and Lithuanian payments firm Kevin. It has no more dry powder for new deals, he said.

ICEYE is a strong IPO candidate and could pursue a public listing next year depending on market conditions, the executive said. Otherwise, however, the VC does not expect much exit activity in the next 12-18 months given the market conditions, Niewinski said, noting that it is focusing on helping its portfolio to become more cost efficient.

OTB has so far exited two companies from its first fund, Niewinski said. In 2020, speech quality enhancement tech provider BabbleLabs was sold to Cisco, before Microsoft acquired Slovak provider of automated process discovery and mapping software Minit last year.

Both deals gave OTB triple-digit IRR and enabled it to return half of the total capital from its first fund to its limited partners (LPs), the executive said.

OTB was founded in 2017 and manages over USD 300m in total assets, according to its website.

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