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German VC Vsquared Ventures closes €214M early-stage deep tech fund

Vsquared Ventures team
Picture credits: Vsquared Ventures

Vsquared Ventures, an early-stage deep tech fund based in Munich, has announced the final closing of its latest fund – Vsquared II. The fund was oversubscribed at €214 million, above the initial target size of €165 million. 

The fund is the largest European early-stage deep tech fund to date, cementing the deep tech momentum in Europe. The closing of Vsquared II brings Vsquared’s assets under management to around €450 million.

Backers of the fund

The fund was backed by a mix of limited partners (LPs), including institutional investors, family offices, fund of fund investors, and other individual players, including founders. These include Novo Holdings, the investment company of the Novo Nordisk Foundation, Lombard Odier Investment Managers, the NATO Innovation Fund (NIF), EIFO, the European Investment Fund (EIF), KfW Capital, and Lingotto. 

Investment strategy 

With the new capital, Vsquared will continue to empower founders building companies based on groundbreaking technologies, creating new markets, and becoming global leaders out of Europe to make the region future-proof. 

The fund targets six generational growth themes: AI & next-gen software, energy transition, new computing and sensing, new space, robotics and manufacturing and tech-bio. Portfolio companies create highly technological solutions, ranging from making battery recycling more sustainable and cost-efficient or ensuring independent access to space.

The firm will invest between €500k and €5 million into 25 companies. Two-thirds of the fund will be used for follow-on investments. 

Portfolio of investments 

The new capital has already led to investments in a diverse portfolio of technology companies as mentioned below: 

  • Neura Robotics: A pioneer in cognitive robotics.
  • Cylib: An innovator in next-generation battery recycling technology.
  • Quantune: A company developing the world’s first wearable laser-based biomarker measurement system.
  • Atrandi: A  enabling next-gen sequencing at scale.
  • Dynelectro: It enables cost-efficient and sustainable hydrogen production.
  • Lace Lithography: A company focused on advancing chip patterning technology. 
  • ConstellR: A company provider of space-based insights.
  • Synthara: A company at the forefront of integrating in-memory computing.

Dr. Lise Rechsteiner, Thomas Oehl, Dr. Herbert Mangesius and Benedikt von Schoeler, Vsquared’s GPs, commented: “Right now there is immense opportunity for Europe to become a global deep tech powerhouse – which is also imperative to secure the continent’s sovereignty and to make it future-proof. Companies that solve real problems through real technology on a global scale will be successful and these are the ones we partner with. As Vsquared continues to drive forward with Vsquared II, we remain dedicated to leveraging not only capital, but also our expertise, extensive partner, and network for our founders, with the goal in mind to prove that the next global deep tech leaders can and will be European.”

Sören Thinggard Jensen, Senior Partner and Head of Private Equity at Novo Holdings, said: “We believe Vsquared is one of the funds in Europe with the best understanding of deep tech startups, proven by the track record in investing early in some of the current frontrunners in the ecosystem. We look forward to partnering with Vsquared to ensure that the continent is strongly positioned and to back the next generation of deep tech leaders out of Europe.”

Marjut Falkstedt, EIF Chief Executive, added: “Europe has leading research facilities and an incredible talent pool, and turning bright ideas into viable business propositions is top of our priority list. This is why we are excited to be supporting Vsquared, who are deep tech experts, to continue to channel financing into Europe’s deeptech ecosystem, confident that progress in this field can play a crucial role in addressing the multitude of challenges that we are facing.”

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