European Venture Firm Overcomes Brexit Concerns With New FundBy
Northzone Raises 300 million euros to back new startups
Investors raised questions about Brexit’s broader impact
One of Europe’s oldest venture-capital firms had to overcome concerns about the post-Brexit future of Europe when raising its latest fund to finance a new batch of startups in the
Northzone, an early backer of Spotify Ltd., said Monday that it raised 300 million euros ($335 million) to continue investing in European companies. In compiling what is the largest fund of the firm’s 20-year history, London-based Northzone turned to investors in Asia for the first time. Many there expressed concerns that the European Union’s future is at risk, threatening the region’s economy.
“The question we had is what’s next -- is the EU going to be fine, is the currency going to crash?” Jeppe Zink, a partner with the fund, said in an interview. “There are definitely concerns out there, but currently because of the timeline most people believe there is still an economic solution that will maintain the U.K. as part of the wider EU market.”
Zink said the U.K. vote to leave the EU, along with regulatory scrutiny of U.S. tech giants such as Apple Inc. and Google, has been a "setback" for the European technology industry. Even so, investors aren’t deterred, Zink said. “People believe in the story,” he said.
Northzone plans to invest in companies that are building services to reach customers on mobile devices. He also sees opportunities in financial-services technology. One company Northzone backed, Barcelona-based CornerJob, provides recruitment services for human resources professionals. Another firm, Helsinki-based Zervant, is an online accounting system for smaller businesses.
Even if the U.K. technology scene struggles as a result of Brexit, Zink said other areas of Europe, such as Berlin and Stockholm, are poised to do well. “Regardless of the macroeconomic picture we have strong talent in our key hubs that will go on to solve big problems,” he said. “As long as we capitalize on them and give them what they need, they will continue to knock it out of the park.”
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.