Balderton on its largest tech growth fund to date
Last week London-based Balderton Capital, which is now actively deploying over USD1 billion in some of Europe’s most prolific breakout companies, announced the launch of a new tech growth fund – their largest in Europe to date. PEW caught up with partner Rana Yared who will manage the fund together with Balderton’s managing partner Bernard Liautaud and general partner David Thévenon.
Balderton Growth I, which the new fund is called, will target 15 or so ‘exceptional’ companies at the early-growth stage (series-C) and is sector-agnostic. “It’s more about the place the company itself is in rather than what letter they've attached to their latest raise," said Yared, when asked about the stage of companies the new tech fund will invest in.
Yared was previously a partner at Goldman Sachs, first in the Principal Strategic Investments Group and later in GS Growth. In that role, she oversaw investments in financial technology and enterprise technology, as well as the commercialisation of Goldman Sachs’ tech assets in both New York and London.
The launch of this latest fund from Balderton, which she will be co-managing, follows the firm’s launch of Europe’s first dedicated secondary fund, Liquidity I in 2018, and Balderton’s seventh Series A fund in 2019.
“We will be focusing on European companies that can turn into European or global champions across all sectors, though we'll lean on our strength within enterprise tech, fintech and consumer tech. We don’t have a geographic bias within Europe; we'll go wherever the opportunity is with a view to building the most innovative portfolio of companies at this early growth stage,” explained Yared.
Balderton already holds one of the largest growth stage portfolios in Europe, having backed some of Europe’s most successful startups from a very early stage. The firm invested at seed or series A in now-global companies including Aircall, ComplyAdvantage, Contentful, Depop, GoCardless, Infarm, Labster, Revolut, THG, Vestiaire Collective and Zego.
With regards to the pandemic fallout and the themes and issues it has highlighted across the globe, Yared takes a pragmatic approach to recent developments. “Covid didn't give birth to any new trends in and of itself – it accelerated trends that were already pronounced in the market, both positively and negatively. One trend which is here to stay is around digital health and telehealth. Long before Covid there were healthcare deserts, more so in the US than in Europe,” she commented.
Yared continued: “Covid resulted in people getting used to doing consultations on a remote basis. From our point of view, this digital telehealth trend will probably stay and continue to accelerate even once we return to whatever the new normal is. Thereby -very positively from a social policy point of view- reducing the impact of these health care deserts.”
Balderton expects to invest between USD25 million and USD50 million per company, through both primary and secondary investments, and is looking for fast-growing companies that have the potential to disrupt global industries.
When it comes to disruption and ESG strategy, Yared firmly believes the venture capital industry should treat investing in accordance with ESG standards as a revenue enhancing choice and a return enhancing choice.
“We’ve signed the UN PRI which now subjects us to audits around that adherence of everything from our carbon footprint to diversity in the workplace, to questions around what we invest in, to strategies on how to encourage positive social and economic behaviour. It’s very important not to think of ESG as this side thing, that you have to do because it’s a ‘do good’ thing.’
Balderton's Liquidity I portfolio includes European growth companies including British AI & cyber security company Darktrace, Flywire, Graphcore and Truecaller.