(Bloomberg) — Speedinvest GmbH is set to launch its fourth fund as the Vienna-based seed investor looks to defy an environment of jittery technology markets.
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The firm, among the early investors in the crypto unicorn Bitpanda, is on track to close its latest funding round — to be worth several hundred million euros — in the next few months, co-founder and chief executive officer Oliver Holle said in an interview. The exact target size wasn’t specified.
Holle is looking to boost the share of institutional investors participating in the fund to about two thirds from half in the previous round, with remaining cash coming from family offices.
He’s betting that investors will look beyond the turbulence in tech stocks to embrace Speedinvest’s strategy of lapping-up early-stage startups that in the company’s first three rounds have included online insurance broker Wefox, e-mobility provider Tier Mobility, and tutoring platform GoStudent.
“We have so many repeat customers from our existing base that we are least worried on the fund-raising side,” Holle said.
Speedinvest is pushing ahead with its new fund even as a slump in technology stocks feeds its way through to the startup universe. A drop in the price of listed entities, including Apple Inc. and Netflix Inc., in turn often puts pressure on the valuation of privately-owned companies, hurting funding prospects and reducing bandwidth for early investors to exit their positions.
For Holle, building a portfolio that invests in early-stage companies still makes sense as they will be a few years away from needing more capital. They’re also often more immune to some of the economic difficulties hitting larger peers, including inflation and access to human capital.
For companies in a more mature phase of their life cycle, the next 12 to 18 months is going to be more challenging, he said. While top-tier companies continue to have abundant access to funding, the remainder will have to rely on more support from their owners and more time to develop.
Even then, getting to a listing may be a challenge. “We have a couple of scale-ups, or unicorns, that were clearly on a path to going public,” Holle said. “That won’t happen this year.”
But the turmoil may also bring some upside as the era of cheap money and frenzy of competing venture-capital investments calms down.
“This crazy wave where every week you have a new seed fund popping up can come to some sort of a stop,” Holle said. “Not everything will be as fun anymore.”
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