EQT Ventures - doing VC differently

When the EQT Ventures fund launched in May 2016, the team wanted to do VC differently. So, what does this mean exactly? The team wanted to create the kind of VC they would have wanted when they were on the other side of the table. Fuelled by some of Europe’s most experienced founders and company builders from the likes of Booking.com, King, Spotify and Hotels.com, the team has been on the entrepreneurial rollercoaster before and knows how tough it is. Really tough! We know from firsthand experience that it takes more than just capital to build a global success story and want to provide the next generation of founders with the coaching, expertise and network needed to build winners.

And doing VC differently doesn’t just stop at support for entrepreneurs. There was a need to provide support for longer and close the later stage funding chasm that had developed between the US and Europe. EQT Ventures’ vision was to be a European investor with a global outlook, bridging Europe and the US and providing European founders with a wider support window so they can make the leap across the Atlantic if and when the time is right. Not just because they need larger pots of cash. Similarly, we wanted to help US founders scale into Europe and access some of the best start-up and scale-up talent in the world. Europe is now.

Finally, at EQT Ventures we recognize that digital transformation is happening across all industries. This is why the fund backs the boldest and most ambitious founders rather than particular sectors. We wanted to disrupt our own industry too. With around 5,000 startups created everyday, we recognized the need for a data-driven approach to discover the breakout winners. Enter Motherbrain - the proprietary AI driven investment platform helping us make faster and more assessments, better decisions and spend more time on relationships. So, 3.5 years in, how has EQT Ventures progressed? 

A true partnership, resulting in the fund’s first exit

As the world prepared for the winter holidays, huge news came out of Helsinki on 20 December 2018, as Small Giant Games, the team behind Empires & Puzzles, entered into an agreement to be acquired by Zynga (Nasdaq: ZNGA) in a deal worth USD 700 million. The deal was a well-deserved milestone for co-founders Timo, Markus, Otto and the rest of the small, passionate, agile and data-driven Small Giant team. They had been determined to build a global hit game and that they did. Empires & Puzzles frequented the top 10 grossing game charts on the Google Play Store and Apple App Store for most of 2018.

As the fund’s first exit just 2.5 years in, the deal was also a huge milestone for EQT Ventures - and a very high caliber one. Since Small Giant Games’ USD 5.7 million Series A funding round in March 2017, EQT Ventures was the largest individual investor in the company and believed that this small team could achieve giant things. This is the reason the fund “doubled-down” on Timo, Markus and Otto at the end of January 2018, when EQT Ventures led a USD 41 million investment in the company so it could continue its growth. Why? The dedicated team, incredible engagement levels for the game and the fact that just four months into 2018, the company had already exceeded 2017’s revenue where signs of a global winner in the making.

The partnership and collaboration between the Small Giant Games and EQT Ventures team - particularly our mobile gaming guru and EQT Partner Lars Jörnow - was key in this journey. Having joined King at the start-up phase - with around 50 employees - and supported its growth into a global industry giant with more than 2,000 people, Lars is able to share his learnings from the journey. And don’t just take my word for it:

“Kudos to EQT Ventures and Lars Jörnow. Our journey quite simply wouldn’t have been possible without your support and deep competence in building and running games as a business. You guys set the benchmark for all VC’s out there!” - Timo Soininen, founder and CEO, Small Giant Games 

Bridging the US and Europe and supporting “locals with locals”

When I joined EQT Ventures and set up the San Francisco team in 2017, the goal was to help the best European startups expand into the US without having to rely on US funding alone. Having taken my own company into the US, I know what a challenge this can be! There are also a huge number of US companies at the series B and C stages looking for a team with on-the-ground experience of navigating Europe’s complexity. That’s where our team can help. Now, the aim of bridging the US and Europe has come to fruition. The EQT Ventures fund now has seven US companies in its portfolio - all destined to be global category leaders, including recent investments in Standard Cognition, Darkstore, HeadSpin and Handshake. Five of the fund’s portfolio companies - Peakon, Permutive, Codacy, Natural Cycles and Tinyclues - have also recently opened New York offices.

With a team of 27 based in Stockholm, London, Amsterdam, Berlin and San Francisco, we are ready to provide the portfolio companies with a “locals with locals” support network. This year, we were also delighted to welcome new partners Lyle Fong (Lithium, YC) and Johan Svanstrom (Hotels.com) who both bring a wealth of additional operating experience to the team. 

Motherbrain - a valued member of the team

Back when EQT Ventures launched, the team was set on having a data-driven approach to VC and developed Motherbrain, a proprietary AI platform dedicated to transforming the very industry it operates within. Fast forward three years and Motherbrain has already flagged five of EQT Ventures’ investments - Peakon, AnyDesk, Handshake, Warducks and Standard Cognitio. 

With EQT Ventures’ global team on hand to support almost 50 companies, we are looking forward to seeing what the next three years brings for the portfolio and the journeys they are on!

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