New European players seek to profit from silicon valley links

01 August 2001

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Two new venture players, Metropolitan Venture Partners and Accel Partners, are seeking to play on their transatlantic connnections to attract leading German technology companies into their portfolios. Metropolitan Venture Partners launched its European operations at the end of last year. Metropolitan has previously invested from MetVP I, a seed fund established with proprietary capital from the Man Group and Hite. The company is now setting out to raise its first external fund, MetVP II, with a $50m target. Marketing is being focused on institutions and high-net-worth individuals in the US and Europe. A $5m cornerstone investment has been secured from the Man Group. Investments, ranging in size from seed funding to $4-5m committed over the life of an investment, will be made in early-stage technology companies which have a significant element of intellectual property and the potential for global impact. A maximum 65% of the fund pool will be invested in either the US or Europe, with the UK, Germany and Scandinavia the main regions targeted for investment. In a separate development, Accel Partners, a Palo Alto based venture capital firm established in 1983, has announced that it is in the final stages of closing a $500m fund dedicated to early-stage European and Israeli technology businesses. A London office was set up in February of this year under Europe managing partner Kevin Comolli, who joined the firm from Doughty Hanson. The fund is now weeks away from finalising the $500m close and has just announced an investment in Irish software company Cape Clear. Structured as an 11-year Delaware LP, Accel Europe has secured commitments from a range of US and European blue-chip institutions, pension funds, family trusts and high-net-worth individuals. The Accel fund will make early-stage investments, with the emphasis being more on series A and B funding and less on seed investments, of $10-15m in total. The focus is on communications and software/internet businesses. 25-30% of the fund pool is earmarked for investment in Israel, with the remainder being split between the UK, Ireland, Germany and Scandinavia.