Estonian VC Superangel announces new €50 million fund

Estonian venture capital firm Superangel has announced a new €50 million fund, which will be used to invest primarily in Baltic and Nordic deep-tech startups. The company is known for being backed by prominent entrepreneurs and angel investors from a tech ecosystem that consistently punches above its weight.

Superangel launched its first fund, worth €16 million, in 2018. Collectively, the team behind the firm has now invested in more than 100 startups around the world. That also includes four companies that have reached a $1 billion valuation, three from Estonia: super mobility app Screwstart identity verification Verifythe first smart sales and revenue CRM platform Pipedrive (as well as Colombian on-demand delivery startup Rappi).

“We are going to continue to build on the success of this region, of Estonia, and also further facilitate this collaboration model,” Veljo Otsason, General Partner of Superangel, tells Sifted.

Supporting regional giants

Over the past four years, the Estonian early-stage company has backed some of the region’s most promising startups, including Bolt, Veriff, starship technologies Y Nordigen. The team paid checks of between €100,000 and €1 million, much of it for seed rounds and Series A.

Otsason says this new fund will continue to focus on science-based and R&D-intensive companies.

“What we are doing differently with this second fund is having an even clearer focus on deep technology, areas where companies have a larger share of their intellectual property in science, technology or significant engineering innovation.”

Major investors in the new fund include SmartCap, with Superangel’s general partners personally committing 10% of the fund.

Limited partners, meanwhile, include serial entrepreneurs and investors like Grünfin founder Triin Hertmann, an early Skype and Wise employee, and Kersti Kaljulaid, former president of Estonia, who led the country from 2016 to 2021.

a land of unicorns

Estonia is home to the highest number of unicorns per capita in Europe, making it an attractive location for an early-stage investor. It is also known for its highly collaborative opening scene.

In a novel approach, Superangel tokenizes up to 5% of its new fund’s accrued interest, which will be given to industry experts who work closely with portfolio companies to help them develop strategies and processes.

“We have built this super network of experts in very different fields who are willing to help companies, sometimes saving them a lot of time and money by giving them advice, helping them build their sales teams, building financial models and all kinds of help that soon start-ups may need,” says Otsason.

“It’s like saying an extra thank you; everyone who contributes gets a token that entitles them to a portion of the fund’s accrued interest.”

The tokenization is being led by one of Superangel’s portfolio companies, Koos, which is seeking alternatives to the tried and tested shareholder approach to rewarding employees, outside experts, and early backers.

“Basically, you can build an investment portfolio without investing anything other than your focus and time,” says Koos co-founder Taavi Kotka, who previously served as board director of the Estonian e-residency program.

Otsason admits that the details of how tokenization will work in practice have not yet been fully worked out, but he sees great potential and believes it is an approach that many others will take in the future.

Looking ahead, Otsason says they aim to make about 40 total investments from the second fund, about ten a year for the next four years, with several investments already in the pipeline.

“Overall I think it’s a good time to make investments,” he says of the current economic climate. “It is always cyclical, there are moments of great optimism and there are moments when people return to what is really important, solving real problems”.

Kit Gillet is the Eastern Europe correspondent for Sifted. He tweets from @KitGillet

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