Backing individual VC funds isn’t the only way investors can get access to VC.
They can also invest in VC fund of funds — vehicles that invest in multiple VC funds — and there’s a growing number of them in Europe.
These funds can help get LPs — limited partners, the investors in VC funds — access to competitive top-tier funds, and better returns through diversity. But they’re also seen as important actors in the ecosystem’s maturation.
The European Commission — when it announced its €2.1bn fund of funds strategy several years ago — argued that a lack of VC funding is holding European tech back; it cited the fact that US VC firms were three times larger than European ones on average.
Fund of funds like Multiple and Isomer are also playing an important role in helping the next generation of investors get on their feet by specifically backing first-time or emerging managers. Some may also co-invest — in other words, invest directly in startups alongside the managers they back — often helping get deals over the line.
We’ve compiled a list of European-headquartered fund of funds and VCs with fund of funds strategies that are backing VCs in the region and beyond. If we have missed anyone, please email [email protected].
A few notes on the structure of this list:
- We have not included state or government funds like the European Investment Fund.
- We did not include fund of funds headquartered in other regions, despite the fact that there are many US fund of funds active in European VC.
- Many VCs invest in other funds but do not have a public strategy or a separate vehicle to do these investments. We’ve excluded these.
All Iron Ventures — Spain
A Spanish VC founded by former founders that also launched a fund of funds in 2022.
Date launched fund of funds strategy: 2022
Size of fund of funds vehicle: €30m
Number of funds backed to date: Five as of June: Hoxton Ventures, Left Lane Capital, Speedinvest, Crane Venture Partners and firstminute Capital.
Geography: Europe
Back emerging managers? No
Co-investments? No
AlphaQ Venture Capital — Germany
Date of launch/founding: May 2022
Size of last fund of funds vehicle: €500m, an evergreen vehicle with a rolling close.
Number of funds backed to date: 6 VCs to date including White Star, Nucleus. Scale Venture Partners, Abstract Ventures, Signature.
Geography: Europe, US, Israel.
Back emerging managers? Yes
Co-investments? Yes
How should managers pitch you? “Send us an email with their deck. If interested we schedule a call. We like small funds, relative to market size. We like focused funds with a clear thesis. We like managers with a proven track record. We like emerging managers with an institutional setup and clear LPAs [limited partner agreements]. We like access constraint funds that close within their planned timeline,” says founding partner Stephan Heller.
AXA Venture Partners (AVP) — UK
AVP is a global VC firm that also has a fund of funds strategy.
Date launched fund of funds strategy: 2017 when the firm hired Dominic Maier as head of fund investing.
Size of fund of funds vehicle: Current vehicle is €230m.
Maier says AVP is “imminently launching a larger vehicle in order to take advantage of the reset within all stages of venture and to participate in what we believe will be some of the most successful vintages for venture investing globally.”
Number of funds backed to date: 40 funds (since 2017).
Geography: “Established venture ecosystems globally” which means east and west coasts of the US, western Europe, Israel, India, China and most recently southeast Asia.
Back emerging managers? Yes
Co-investments? Yes. Maier says AVP co-invests alongside the general partners (GPs) in its portfolio and is “most excited by follow-on rounds where our underlying managers have known the founders and company for several years”. AVP also participates in LP secondaries, where they take over an LP stake in a VC fund.
How should managers pitch you? “The best way for us to get to know GPs is over a long period of time. We love to see GPs say they will do something and then for them to come back showing us they have done it. This doesn’t necessarily need to be a multi-fund cycle, it can start during the middle of a fund for us to get excited for the next fundraise. A part of what they should be able to articulate is ‘Why us? Why now? Why here?’. And, finally, the best way to get our attention is (very typically) through a warm introduction,” says Maier.
Blue Wire Capital — UK
Blue Wire is a VC firm that invests strategically into emerging managers.
Date of launch of fund of funds strategy: Blue Wire was founded in 2013, and started doing fund investments from the beginning.
Size of capital invested in fund of funds strategy: Invests in around one or two new managers a year with ~£1m tickets each.
Number of funds backed to date: Roughly 15 funds; most recently Creator Ventures, Creator Fund and Form Ventures.
Back emerging managers? Yes, almost exclusively. Ideally their first fund.
Geography: Global, with a preference for Europe.
Co-investments? “We are very strict on not picking managers on the basis of quality co-investment opportunities that they might show us — it’s much more about the strategic alignment and what having these funds in our ecosystem can bring to our founders or our own way of working (as well as returns profile, of course). But yes, we hope that as we become a trusted partner to our funds there might be opportunities to work together on early deals and we have done this a couple of times in the past,” says Bertie Highmore, head of investments.
How should managers pitch you? “People can reach out to me on LinkedIn, that’s probably easiest. We do have a Pitch Us submission on the website, but that’s mostly for companies.”
Equation — Germany
This fund of funds came out of stealth in 2022 and backs micro VCs and “emerging blue chip” managers. The firm manages over €100m in assets but has not shared the size of each of its funds.
Date of firm’s founding: 2020
Number of funds backed to date: 16, including Amino Collective, Discovery Ventures, Visionaries Club, Vsquared and Possible Ventures.
Back emerging managers? Yes
Geography: Focus on Europe but also the US and Israel
Co-investments? Yes
How should managers pitch you? “Approach via introduction, LinkedIn outreach or our website with an elevator pitch and teaser materials.”
Isomer Capital — UK
Isomer is an investment company whose flagship strategy is a fund of funds, but it also has a fund to invest in the companies that its portfolio of VCs have backed.
Date of founding: 2015
Size of last fund: €220m
Number of funds backed to date: 61 funds, including Seedcamp, EF, Lunar Ventures, Crane, Atlantic Labs, Kibo Ventures, Credo Ventures and OpenOcean
Geography: All Europe
Back emerging managers? Yes and have incubated some funds, meaning they have helped them from inception to launch.
Co-investments? Yes
How should managers pitch you? Email [email protected]
Molten Ventures — UK
Molten Ventures is one of the few publicly listed VC firms and has backed names like Revolut and UiPath. It has a well-known track record of investing in other VC firms.
Date launched fund of funds strategy: 2017
Size of capital invested in fund of funds strategy: £150m committed to date.
Number of funds backed to date: 67 funds and 53 fund managers as of September 2022, including Seedcamp, Moonfire, Possible Ventures, Antler and Future Positive Capital. There’s a list on their website. A quarter of their funds have one or more female GPs.
Geography: UK and Europe, plus “thesis-driven US funds with a strong European exposure,” says Mohadeseh Abdullahi, on the firm’s fund of funds team.
Back emerging managers? Yes. A third of the funds backed are emerging managers.
Co-investments? Yes. “We can co-invest, go direct and invest in SPVs [special purpose vehicles]. Helping our GPs continue backing their portfolio winners is an important part of our strategy,” says Abdullahi.
How should managers pitch you? “We want to understand the story of the people behind the fund, and what motivated its inception. Given the longevity of the GP-LP relationships, the people always come first. We are then looking for why your strategy is unique in its respective geography, thematic or sector and how you aim to add value to the founders you back.”
Multiple Capital — Germany
Multiple Capital is a fund of funds that invests in micro and seed-stage VCs with a focus on Europe.
Date of founding: 2013
Size of last fund: €20m
Number of funds backed to date: 44, including Earlybird East (Fund I), IQ Capital, Angular, Air Street Capital, EF and Icebreaker.
Back emerging managers? Yes
Geography: Europe and 20-30% outside of Europe
Co-investments? No
How should managers pitch you? “Ideally through our website ’contact us’ button,” says managing partner Ertan Can.
Sella Venture Partners — Italy
The VC fund of funds arm of Italy’s largest private and independent banking group.
Date of founding: 2020
Size of last fund: €60m
Number of funds backed to date: 18 funds with an overall target of 23-24
Geography: EU and North America
Back emerging managers? Not currently but planning to launch an emerging manager allocation in 2023.
Co-investments? No
How should managers pitch you? Contact managing partner Luca Mannucci or analyst Giovanni Paratore.
Other European fund of funds on our radar:
- Aldea Ventures (Spain)
- Anthemis Group (UK)
- Blue Future Partners (Germany)
- RSJ Investments (Czechia)
- Presight Capital (UK)
- Top Tier Capital Partners (US, Luxembourg)
Eleanor Warnock is Sifted’s deputy editor and cohost of The Sifted Podcast. She tweets from @misssaxbys
