DN Capital raises €144m for third fund

Harriet Bailey
02 September 2014

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London-based DN Capital has raised €144m for its third European venture and growth capital fund, GVC III.

The fund's target was €100m. DN raised more than three times the amount held in its previous fund, GVC II, and was just shy of hitting its hard-cap.

While DN stated it found the fundraising process difficult initially, DN founder Nenad Marovac attributes the eventual over-subscription to the fund to "investors' growing appetite for European venture".

The fund is already more than 50% committed, with 50% of those allocations to German tech and IT companies.

In April, unquote" reported the London-based VC had raised €80m, after holding a first close on €51.5m in August 2012.

In July 2014, DN invested less than €5m from GVC III in online professional cleaning portal Book a Tiger. Book a Tiger was set up by Delivery Hero's co-founders, who intended to use the money for expansion and to establish the portal as a leading platform in Germany.

According to DN's founder, Nenad Marovac, the GP seeks to back portfolio companies through several funding rounds before divesting via a trade sale or IPO.

DN currently has offices in London and Silicon Valley and is looking to open a Berlin office soon. It is also actively looking to grow its team of 12-15 people.

Investments
GVC III will target early- and growth-stage companies in northern Europe, particularly in the UK, Germany and the Nordic region. It also has a 25% allocation for US companies expanding into Europe.

DN, which now has a total of €320m under management, invests in the areas of software, mobile applications, digital media and e-commerce.

First-round investments sit in the €250,000-10m range and DN expects to make 30-40 investments over the life span of the fund. Two thirds of the investments will be seed and early-stage, with one third assigned to growth financing.

Investors
Family offices, large institutional investors and sovereign wealth funds from across Europe and North America committed to the fund. The majority of LPs are based in the US, the UK, Germany and Switzerland. LP commitments include a €3m contribution from Finnish Industry Investment and backing from European Investment Fund (EIF).

Rather than having one cornerstone investor, GVC III has 4-5 main investors. According to DN, all existing backers re-upped into the fund and in most cases increased their allocations.

People
Nenad Marovac is founder and managing partner of DN.