Speedinvest III closes on €190m

Announced in February 2019 with a target of €175m, the fund closed on its hard-cap and is domiciled in Austria as a KG structure.

The fund's predecessor, Speedinvest II, closed on $100m in 2015 and has now been fully deployed. The firm's debut vehicle has realised 11 investments from a portfolio of 20 companies, and has achieved a return of 5x gross, for 2x distributions to paid-in capital.

Speedinvest CEO Oliver Holle said: "Our strategy will not change that much. We'll still be focused on seed and pre-seed investments. The main difference is that we'll now be able to deploy more capital in our portfolio companies. In the past, we've been able to do a pro rata commitment to series-A rounds, following our initial investment, and small commitments to series-B rounds. For the winners in our portfolio, we realised it would have been a real opportunity for us to stay more involved."

The fund has a management fee of 1.8% per year averaged out across the life of the fund and a 20% carry.

Connaught provided corporate finance advice and SNP provided legal advice.

Investors
Major investors include the European Investment Fund, Erste Bank and US-based NEA. Cornerstone investors did not commit more than 25% of the fund and the minimum commitment was €500,000. The fund has around 100 LPs in total, though Holle said the distribution of capital was heavily skewed towards institutional investors.

The composition of the fund includes all types of institutional investors, including pension funds, endowments and family offices. Holle said the fund benefits from a broad base of small private investors, who contribute their dealflow and expertise to the fund.

"I was really positively surprised by the fundraising process," said Holle. "We had a positive reaction to our past performance and the increasing brand awareness we have been able to build, as well as our one pan-European platform for seed investments."

Investments
The firm's pre-seed team will write cheques of €50,000-200,000, while its seed team will write cheques typically of €500,000-1m, though the fund has a mandate to write initial tickets from €50,000 to €1.5m. Investments will include early-stage startups in financial, marketplace and industrial technologies, digital health, and "deep tech" (companies based on substantial scientific advances and high-tech engineering innovation).

The firm has a pan-European approach. It currently has teams in Vienna, Munich, Berlin and London, and is expected to expand its presence in France in Q2 this year. Holle said: "Each of our teams will do three or four investments per year, amounting to 15-20 investments over the life of the fund. It's an unusual month if someone from the firm isn't doing a deal."

Of the fund's commitments, €100m will be used as follow-on funding for well-performing companies the firm has already invested in.

The fund has a portfolio of 12 investments currently and expects to hold 80 at the end of its life.

People
Speedinvest – Oliver Holle (CEO).

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