Speedinvest holds first close for Speedinvest x Fund 2

Speedinvest x Fund 2 is targeting €50m and aims to hold a final close by the end of Q1 2021.

Schnittker Möllmann Partners (SMP) provided legal advice for the fund.

Speedinvest's first fund in its Network Effects strategy held a final close in June 2018 on €25m. The GP held a final close for its third flagship fund in February 2020 on €190m.

Julian Blessin, co-founder of e-scooter startup Tier Mobility, has joined Speedinvest as partner. Speedinvest backed Tier Mobility's latest $250m round led by Softbank in November 2020.

The Network Effects team is led by partner Mathias Ockenfels. Asked about the timeline for the fundraise, Ockenfels told Unquote: "We started the fundraise at the beginning of 2020, just before Covid-19 hit. It was challenging at the beginning, mostly as the capital markets were frozen for a couple of months, people were in waiting mode to see how everything would unfold. We were lucky that due to the strong performance of the fund and the strong commitment of existing investors, we could push through with the fundraise and stick with our pre-Covid-19 timeline.

"We have already been able to distribute money to our investors from Fund 1, which held a first close in November 2017, and we are now launching Fund 2 following these significant distributions. We have a specific structure where the funds are matched by our horizontal fund, so they can deploy double the amount, and it's the same for this fund."

Ockenfels emphasises the importance of differentiation for VCs in the early-stage ecosystem, given the competitive nature of the market: "In general, especially at early-stage, there is more and more competition. But that's why it's more important than ever to have your own USP and clear strategy as a fund – our strategy of having vertical focus funds and clear expertise plays into that trend. We help businesses beyond just money, which is where our broader Speedinvest ecosystem comes in handy, since we can provide operational support. We have experts in growth hacking, marketing, hiring and business development."

"A lot of investors were more on the sidelines during Covid-19, but now the pace is accelerating for many again," Ockenfels said. The later-stage ecosystem has also been adapting to deal-making during coronavirus lockdowns, he said: "We did continue to make deals during the pandemic, and later-stage investors are now getting used to making remote deals over Zoom, but we have done this before so continued with business as usual. So there is some pent up demand in later-stage investing, and therefore I would expect a lot to happen in Q4 2020 and Q1 2021."

Investors
The first close was reached with the backing of Speedinvest's existing LPs. These include corporates such as Russmedia, which also committed to the previous vehicle. There were 16 LPs in the first Speedinvest x Fund, including ProSiebenSat and Schibsted. The minimum commitment for institutional investors was €1m.

The fund also counts among its investors private individuals and entrepreneurs from its network, for whom the minimum commitment was €100,000.

Investments
The fund contributes €100,000-1m in pre-seed, seed and series-A rounds. Its predecessor deployed equity tickets of €600,000-800,000 in total rounds of €1-1.5m. The vehicle targets companies based in Europe, although it can also invest in US-based businesses.

The GP's predecessor, Speedinvest x Fund, invested in companies including Tier Mobility, CoachHub, Packhelp, Kodit, Planetly, Admix and Schüttflix. The fund invested in 15 companies in total and the new fund will make 25-30 investments.

Asked about the fund's deals pipeline, Ockenfels said: "We have some deals in the pipeline that should be announced in the near future. We are switching funds a little ahead of schedule, we have a three to four year investment period, and we are planning to invest at a similar pace for the second fund. So we are not making any new investments from Fund 1, although we have one in the pipeline, and we still have reserves for follow-ons."

People
Speedinvest – Mathias Ockenfels, Julian Blessin (partners).

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