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Finch holds first close for third European fintech fund

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Early-stage venture capital firm Finch Capital has held a first close on €85m for its third fund, Europe III, which will invest in European fintech companies.  

The fund is targeting €150m and saw a near 90% follow-on investment from previous funds.

The vehicle, once it reaches the target amount, will be bigger than its predecessor, which held a final close on €110m in August 2018.

The GP's current portfolio includes Trussle, Fourthline, Goodlord, Grab, Hiber, BUX, Twisto, and Zopa. Its exits include Salviol and Cermati, and it is currently in the process of exiting two further companies.

Investments
The new fund will invest €2-10m at series-A and series-B stages, acquiring minority stakes of 20-49% in companies with €2-5m in revenues – a segment that the GP believes is currently facing a funding gap.

Like its previous funds, the vehicle will back 15-20 European startups, with a plan to exit three to five years after investment, over the fund's three year initial investment lifespan.

Finch managing director Radboud Vlaar said the GP had "always been bullish on investing in financial technology" and that it planned to double down on financial software, "especially those companies that leverage AI to this end".

Since its inception in 2013, Finch has made a total of 40 investments across Europe and Asia, and its assets under management now total $400m.

The GP also invests in south-east Asia and has launched a $50m fund, Finch Capital SEA II, for investments in the region; the vehicle will hold its first close in the coming months.

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Finch Capital – Radboud Vlaar (managing director).

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