The US has had solo VC fund managers for a few years however the development is just simply beginning to catch on in Europe. One of many latest is Underline Ventures, began this 12 months by Bogdan Iordache in Romania. His profession trajectory in the direction of being a Solo GP suits the profile: a former entrepreneur, a key participant within the Japanese European tech scene, a founding father of the Net convention, and a former VC in a a number of Accomplice workforce.
Above all, what Europe wants extra of is these ‘funds of funds’ that are specialised in working with this new wave of European Solo GPs.
Hypernova, a $25m fund which soft-launched in June has been based by skilled investor Tugce Ergul. She plans to not solely put money into different funds but in addition instantly into startups. Ergul was previously with Angel Labs, an “investor accelerator”, which unfold throughout 44 nations.
Chatting with TechCrunch, Ergel stated: “There’s a brand new wave of funds developing. We’re speaking about profitable founders that are actually beginning their very own funds to put money into new entrepreneurs. There are companions leaving their former funds beginning their very own funds, as a result of now it’s simpler and cheaper than ever to start out a fund. And there’s extra assist for solo capitalists.”
So how does it work? Hypernova places 40% of its fund into Solo GP funds, and the remainder instantly into startups, with 50% within the US and 50% in Europe.
Ticket sizes will probably be $500k-750k into these Solo GPs who’re elevating their first fund, and Hypernova will intention not only for financiers however probably journalists, angel traders, former entrepreneurs, or Associates / Companions spinning out of their earlier VC fund.
Hypernova presents new GPs assist on the fund administration aspect, the tech wanted, LP introductions, branding assist, and coinvestment alternatives
Ergel added that previously no LP would give Solo VCs any cash: “Now there’s a there’s a brand new world on the market yow will discover LP cash in the event you’re only one particular person and a solo GP. Beginning funds has turn into cheaper. You’ll be able to arrange a fund for $10,000 and your fund admin prices are actually low. So it’s simply making the entry which rather more simple for these fund managers. So we need to again these fund managers. Then that’s the place the hybrid play comes into place as a result of the opposite half of the fund is a direct funding car. And we are going to both co make investments with these funds that we put money into, or we’re going to put money into the observe on rounds into the winners of those fund managers.”
For its direct investments, Hypernova plans to concentrate on automation, retail, finance, logistics, transportation and transport, with $250k-500k ticket sizes, and it received’t take board seats.
Hypernova is claiming to be the primary female-led solo GP fund in Europe and the primary female-led solo GP fund-of-funds within the US
Since its delicate launch in June Hypernova says it has:
– Invested in an early stage infrastructure fund primarily based out of San Francisco
– A London primarily based fund managing athletes’ cash
– A Berlin primarily based, solo GP fund
– LA-based deeptech fund
– San Francisco primarily based fund investing in LP secondaries (Fund II).
– Invested instantly in a hydrogen market primarily based out of San Francisco
– DevOps for carbon removing corporations primarily based out of Berlin
– Cohort primarily based studying and expertise platform primarily based out of London referred to as Neol
– a Micro-fulfillment platform to optimize the final mile
It now plans to open an workplace in London and rent a London primarily based associate as of January 2023.
And it’s launching an LP variety and inclusion program to get new traders into the fund-investing sport the place they might co-invest with with very small quantities.
“I’m a solo enterprise capitalist myself,” Ergel added. And that’s additionally one of many new issues for the markets. I began this as a result of I skilled so many difficulties and points myself being a solo GP. If I had began this within the US as a pure US targeted American fund, I’d have closed it in six months. However as a result of I wished to do one thing that’s bridging US and Europe it took quite a bit longer.”