Supporting the next generation of European and Israeli founders to build global winners
As early backers of European technology entrepreneurs for over 20 years, we always thought large outcomes would happen here. We have been early to many markets including China, where our investment in Alibaba in 1999 coincided with continued growth of the broader ecosystem. And when we launched our first dedicated European fund nearly a dozen years ago, in the midst of the global and Eurozone crisis, there were still a lot of questions about our ability to build large outcomes here. As we announce our fourth and largest fund for the European and Israeli scale-ups, we are delighted how fast the ecosystem has evolved and mindset changed.
Europe’s (including Israel) technology landscape is on fire. The region is building more and more globally winning companies: with 37 decacorns, and more unicorns than China, Europe is squarely on the global innovation map; and Israel is proving its desire to build larger outcomes into tens of billions of dollars of value. World class consumer, SaaS, fintech and digital health companies are springing up all across the continent. Entrepreneurship has been democratised: companies can be launched affordably on ubiquitous cloud platforms like AWS and GCP, startups can reach their target customers easily on various social platforms, and workforces can be dispersed virtually to attract top talent.
Perhaps more impressively - European entrepreneurs are demonstrating the scale of their ambition. Founders we partnered with in their early days like Emil Eifrem (CEO of Neo4J), Oren Kaniel (CEO of AppsFlyer), and Ronni Zehavi (CEO of HiBob) have built businesses that are now global leaders in their respective fields, and they feel like they are just getting started. Their examples are inspiring new generations of entrepreneurs, and Europe’s best and brightest are excited to join startups, fuelling the innovation cycle.
As a result, European companies are growing faster than ever before. Companies like our portfolio company Cazoo, under Alex Chesterman’s leadership, are able to hyper-scale in breakneck speeds from closing a pre-seed round in December 2018 to approaching $1 billion in revenues and listing on the NYSE for $7 billion in August 2021 – all in less than three years. The opportunities now know no bounds and Europe will soon produce companies worth more than $100 billion in market cap, an unprecedented feat.
With that said, with more developers and a larger local market than in the US, Europe can do more to make building of large companies more systematic and predictable. Across the fragmented European market, founders can benefit further from scale up assistance and support communities as they look to build globally winning companies. This is why we are excited to share the news of our fourth fund - $450 million to support the next generation of European and Israeli founders to realise their ambitions. With this new fund we will continue helping scale up companies that have reached product-market fit by:
• Bringing our global platform to help geographic expansion: we’ll use our 50-year history of global investing and global platform which includes offices across Europe, the US, China, India and Japan, 300+ portfolio companies to help companies expand westward or eastward
• Providing sector and functional experience to assist through the scale-up phases: In addition to our investment team, led by Davor, Michael, Lucile, Alston and Vytas, our global group of over 35 sector and functional experts will look to partner with outstanding companies and help them achieve their ambitions
• Always putting our entrepreneurs at the center of our work: We prioritise the relationships we have with our portfolio and support management teams through both the good and bad - we know that the entrepreneurial journey is rarely linear and without bumps in the road. We continue to regularly measure our portfolio NPS and are proud of our recent score of 89 - we will continue to partner with our entrepreneurs and work tirelessly to help our companies succeed
As we get our heads back down to work, we just want to say a big thank you to those that have supported us so far, our founders and their teams, our co-investor partners and our investors. We look forward to continuing our work together and growing the market to further heights.
The Eight Roads Ventures Europe team