In the world of startups, it will not be unusual for talent from successful corporations to go on to found their very own corporations. This is especially evident within the fintech space in Europe, where graduates from unicorns equivalent to Monzo, N26, Revolut and others have founded quite a lot of latest corporations.
Andrena Ventures, a UK-based solo GP fund, goals to support this startup factory snowball effect by investing in such second-generation startups on the pre-seed and seed stages. To this end, it’s raising $12 million from backers including several VCs and entrepreneurs. There was an initial closing and a final closing is planned for later within the 12 months.
The company’s general partner, Gideon Valkin, told TechCrunch that while he’ll fund talent with roots in European and UK fintech, Andrena itself is industry agnostic. He expects most of his portfolio corporations to concentrate on other categories equivalent to AI, climate technology and B2B business solutions.
Andrena has already made his first investment: Nustom, an AI startup founded by Monzo co-founder Jonas Templestein, who Valkin reported to when he worked at Monzo. Nustom hasn’t launched publicly yet (which its succinct website explains) but already has a protracted list of investors, including OpenAI, Balaji Srinivasan, Garry Tan, Naval Ravikant, and others.
Andrena’s participation in Nustom’s party round reflects the corporate’s thesis and strategy: most frequently it should donate between $100,000 and $400,000 to rounds led by others. However, Valkin hopes his network will make it easier for founders to boost Series A rounds, perhaps from his limited partners or from other investors he’s connected to.
The solo GP approach
By leveraging its network and writing relatively small checks, Valkin hopes to realize access to hot deals that larger funds may not give you the option or willing to take part in.
A small fund signifies that small investments have the potential to recuperate all the invested capital. For a bigger company, such investments would neither make the difference nor be well worth the risk. Valkin knows this side of the equation: After leaving Monzo, he became an angel investor himself and commenced working as a seed investor at VC firm Entrée Capital, which is now one in every of Andrena’s limited partners.
However, managing a solo fund will not be without its challenges, and never simply because the management fees are relatively lower. As my colleague Rebecca Szkutak noted last 12 months, “Aspiring managers have found themselves on the same rollercoaster ride as startups in recent years.”
Valkin says he took a major pay cut, but he sees a bonus in that: Founders can see him as a trusted partner with just as much at stake. “I think this brings us together really well,” he said. Its value proposition is to open its network to founders and help them raise a Series A round, while counting on its operational expertise.
This mix is more common within the US than in Europe, where many local VCs have never founded an organization. But things are changing and angel investing is becoming more common amongst European entrepreneurs, particularly within the fintech space.
One of Andrena’s LPs, Taavet+Sten, is an investment vehicle run by Wise co-founder Taavet Hinrikus and Teleport co-founder Sten Tamkivi. Both are former Skype employees and have now officially launched an early-stage enterprise fund. Pluralwith two other partners.
The incontrovertible fact that the couple decided to support Valkin may be seen as confirmation of his thesis. As hordes of early fintech employees look for his or her next challenge, the name Valkin selected for his company is apt: Andrena is a species of bee, and “pollination, in my opinion, is probably the best analogy for what I do,” he said.
