Change Ventures aims to hold final close for EUR 20m third fund by mid-2024

The sponsor launched its Change Ventures Fund III in April 2023, Berzins said, but declined to disclose its current size, only adding that there is “room to invest”.

It has private investors and family offices among its LPs, and expects to attract more such investors, Berzins said. Moreover, it could potentially also raise capital from funds-of-funds or pension funds, he added.

The sponsor has already made several investments from its latest fund, Berzins said. Change Ventures has a good pipeline of investment opportunities in the Baltics, which is its focus investment region, he said, without discussing its most near-term investment plans.

Change Ventures will aim to deploy its third vehicle into 30-40 startups active across various technologies over its four-year investment period, Berzins said, but it has flexibility regarding this planned investment period.

It will offer initial investments of EUR 100,000-EUR 500,000 in pre-seed rounds, Berzins said.

Change Ventures can be either a lead investor or co-invest alongside other investors, he said.

Around half of the fund is reserved for follow-on investments, according to the sponsor’s announcement on the launch of Fund III in May 2023. 

Change Ventures invests in software and hardware businesses, e-commerce, Artificial Intelligence (AI), B2B software and Software-as-a-Service (SaaS) startups, among others, also according to the announcement. For example, it invested into Trace.Space, a Latvian document management software platform for product requirements, from its third vehicle, also according to the announcement.

The sponsor was advised by COBALT on creating its third vehicle, according to the law firm’s announcement.

Follow-ons and new rounds
Change Ventures chose to raise a smaller third vehicle focused on pre-seed investments compared with its ca. EUR 49m Change Ventures Fund II, which it launched in 2019, Berzins said, adding that this way it can operate with a smaller team and spend more time with founders.

The sponsor launched its ca. USD 5m debut fund in 2017, Berzins said. 

The investment periods of both funds are over, although the vehicles have dry powder left for follow-on investments into their portfolio companies, Berzins said. Its debut fund has nine portfolio companies and its second vehicle has 22, he added.

Change Ventures has two exits to date, Berzins said, naming Nordigen as an example. The Latvian open banking platform was sold to GoCardless, a UK-based online payment platform, for an undisclosed sum, as reported in July 2022.

All of the sponsor’s funds have life cycles of ten years, which can be extended, Berzins said, without discussing its next exit or fundraising candidates.

Some of Change Ventures portfolio companies include Veriff, an Estonian identity verification solution; Planet42, an Estonia-registered mobility start-up offering rent-to-buy used car subscriptions in South Africa and Mexico; Aerones, a Latvian robotics company for wind turbine inspection; Printify, a US- and Latvia-based print-on-demand platform; Interactio, a Lithuanian remote simultaneous interpretation platform; Giraffe360, a UK-headquartered PropTech startup; Eurora, an Estonian cross-border compliance service provider; KWOTA, an Estonian carbon credits marketplace; Fyma, an Estonian AI-based computer vision company, according to the sponsor’s website.

Several of these companies are aiming to raise further growth capital. Fyma’s CEO and co-founder Karen Burns told this news service in July 2023 that the company expected to raise up to USD 25m Series A by early 2025, as reported.

Eurora’s CEO Anneli Aljas told Unquote sister publication Mergermarket in May 2023 that it was looking to raise up to EUR 15m interim round with Series B expected in 1Q24.

KWOTA’s CEO and co-founder Rain Vääna told Mergermarket in March that it was looking to raise EUR 4.5m seed round.

Giraffe360’s CEO and co-founder Mikus Opelts told this news service in December 2022 that it was planning a Series B round in 2023 at the earliest.

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