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Revent — a new European early stage (pre-seed to series A) venture capital fund with an ‘impact’ focus — is coming out of the gate today, and is poised to reach its target of a €50m ($60m) fund, with the first close of that already completed. Focusing on environmental and societal problems, Revent will be looking to fund startups with both ‘purpose and profit’. Headquartered in Berlin and investing across Europe it will hone in on companies in Climate-Tech, health and wellbeing, and economic empowerment.
The founding partners are Otto Birnbaum, who was previously with French VC Partech, but also worked at HelloFresh; Dr. Lauren Lentz formality of McKinsey and an expert in impact measurement; Emily Brooke MBE, founder of Beryl, a micromobiilty startup; and Henrik Grosse Hokamp who worked previously for Partech’s late-stage fund.
Revent’s founder LP is Benjamin Otto, managing Partner at the Otto Group. Otto is part of the influential and powerful Otto family in Hamburg, founders of the Otto Group. Benjamin Otto also backed the launch of two other German VCs, e.ventures and Project A. Other investors in the fund include Max Tayenthal (N26), Sascha Konietzke (Contentful), Verena Pausder (Fox & Sheep), Luis Hanemann (e.ventures), Benjamin Roth (Urban Sports Club) and Dr. Florian Heinemann (Project A).
Revent has so far made four investments: Tomorrow Bank, a sustainable challenger bank based in Hamburg
; Sylvera, a London-based company that developed AI-enabled monitoring of nature-based carbon offsetting projects; Tmrow, a Denmark-based team building technology products for consumers and companies to understand and reduce their carbon footprint; and net purpose, an impact datastream for asset managers to understand the quantitative net impact of their portfolio, acting like a “Bloomberg” terminal of impact.
Commenting on the launch, Otto Birnbaum, Revent General Partner said: “We’re not acting as philanthropists, but rather aim to demonstrate that achieving very attractive financial returns is possible precisely because of the positive impact these companies will achieve.”
Benjamin Otto, Revent Anchor Investor said: “Social and ecological challenges have reached a new level of urgency. We depend on entrepreneurial innovation to find new solutions. With Revent, we want to create a platform for founders that not only provides them with optimal support but also contributes to a change in mindset: Entrepreneurial success and social-ecological impact can reinforce each other.”
Speaking to TechCrunch, Brooke and Lentz said the “purpose economy” has been accelerated by the Covid pandemic, which has amplified many of the planet’s systemic problems, such as inequality of access to healthcare, EdTech, creating massive changes in the world of work. Their mission, they tell me, is to positively affect the lives of 1 million people and to abate 5 million tons of C02. In order to achieve this, the fund will link fund carry to its impact goals.
They also say they are seeing a new wave of founders who want to tackle these problems. While overall VC investment is up only by about 2%, investment in ‘impact’ spaces such as ed-tech and mental health is booming.
As Brooke told me on a call: “We want to build a new version of venture capital, that authentically and genuinely prioritizes environmental returns and societal returns, along with commercial.”
Lentz said: “We think that there is this generation of founders who are looking for an investor who really brings both financing and an impact mindset. So not a classical impact-first impact investor, or a classic VC that is only looking at the growth trajectory and the financial upside returns. And we think that this founder is looking for an investor who really believes that these two things reinforce each other, and that the returns are going to be generated by positive societal impact, and that there needs to be a European home for this kind of founder.”
The main question is, how are they going to measure the impact?
Lentz said: “We view this holistically, and we start very early, so when we’re in diligence we go through a structured process of basically trying to assess the team, the founder DNA, how committed are they to achieving positive impact. We’re investing very early, usually pre-product, so we need to understand what is the motivation for this team. And then we try to systemically look at the different dimensions of impacts or how deep the impact, how many people will they reach, what additionality are they offering. We go through a structured exercise during the due diligence. And then we do something a bit unique which is we do an impact forecast. And so before we pull the trigger and invest we basically take what the founders have told us, and what we have learned through our conversations about possible growth trajectories, and we try to make some estimates and assumptions around the depth of the impact that the company will have. So it might be how much carbon do we think that the company will be able to beat or avert over the next eight years, or how many lives would they be able to significantly affect and to what extent… We’re not building a 20,000 line model, but we are trying to put some rigour around what we expect to happen on the impact side. Only if we anticipate that the company is going to have very significant potential upside from a commercial point of view and also very significant impact upside would we invest.”
Fronted, the London-based fintech aiming to make life easier for renters, including lending the cash needed for a deposit, has finally launched.
In March, its founders took the decision to “hibernate” the nascent business after the first lockdown and with the pandemic taking hold. But, now with regulatory approval from the FCA and rents falling in London, the startup is officially opening.
“We had a lot of great momentum and then when lockdown came it was like getting headshot from across the map,” Fronted co-founder and CEO Jamie Campbell tells me. “It was when we heard that people weren’t able to move [that] we knew it would be impossible to find early testers for the product and that is when we decided to look at different options. We knew lockdown would delay launching and the furlough scheme gave us options and time. In the end, it was an easy decision and, looking back, it was the right one”.
Founded by Campbell, Simon Vans-Colina and Anthony Mann — former employees at Bud, Monzo and Apple, respectively — and backed by Passion Capital, Fronted is using open banking and other financial technology to offer a credit product designed to finance deposits directly. The pitch is that Fronted can lend more cheaply than existing options, such as credit cards, pay-day lenders and overdrafts, or insurance-backed membership schemes. And, crucially, at lower risk.
“Renting sucks — anyone who rents knows it,” Campbell told me last year. “There are so many problems to solve and we intend to tackle them all bit by bit. But first, we are going to pay people’s rent deposits for them so they can pay us back in bite-size manageable amounts”.
To be able to apply for a Fronted rental deposit loan, you’ll need to be U.K. citizen, have a bank account with more than six months of transaction data and minimum income of £12,000. You are then asked to securely link your bank account data to Fronted via open banking, in order to assess your affordability beyond a simple credit score.
“We believe [this] is a fairer way to determine whether or not someone qualifies for a deposit from us,” explains Campbell. “We are confident we are launching with a fair approach. We don’t, for instance, turn people away who are on benefits or furloughed”.
Fronted loans last 12 months and carry a 12.5% interest rate. However, there are no early repayment fees. Once a loan is agreed, the startup sends the money directly to the estate agent to be placed in the U.K.’s Deposit Protection Scheme, meaning that the loan never touches the renter’s hands (or wallet).
Meanwhile, the timing looks good. Fronted says that 60% of all renters have no savings and are therefore not in a great position to move. Meanwhile, rents are falling as much as 12% in London, meaning that renters could save huge amounts of money simply by moving.
“Deposits are a huge impediment to social mobility; the amount of people who don’t move because they don’t have the money on hand is staggering,” adds the Fronted CEO, noting customers don’t just include those that have already found a place, but also those who are still looking.
“People who haven’t found a place, they are coming to us to see what deposit they could get and then going to find a property… For those people, we give them a maximum which is valid for 30 days so they can shop around knowing they have Fronted in their back pocket”.
Many countries hit hard by Covid-19 are beginning to see a glimmer of optimism from the arrival of vaccinations. Now, a promising travel startup that saw its growth arrested by the arrival and persistence of the pandemic is announcing a $97 million financing facility to help it stay the course until it can finally resume normal business.
GetYourGuide, the Berlin startup that curates, organizes and lets travelers and others book tours and other experiences, has secured a revolving credit facility of €80 million ($97 million at current rates). The financing is being led by UniCredit, with CitiGroup, Silicon Valley Bank, Deutsche Bank and KfW also participating.
CFO Nils Chrestin said in an interview that the funding will let GetYourGuide come “sprinting out of the gates” when consumers are in a better position to enjoy travel experiences again.
The capital could be used potentially for normal business expenses, for acquisitions or investments, or other strategic initiatives, such as more investment into the company’s in-house Originals tour operations or new services to book last-minute experiences, he added.
And even if a lot of tourism has really slowed down, there are still people taking short-distance trips or buying activities in the cities where they live (and are not leaving). While some metro areas like London are essentially only open for booking well in advance (when the hope is lockdown restrictions might be eased), other cities like Rome or Amsterdam have activities available for booking today.
GetYourGuide’s latest financing news underscores how some startups — specifically those whose business models have not lended themselves well to pandemic living — are getting more creative with their approaches to staying afloat.
GetYourGuide has raised more than $600 million in equity capital since 2009, with its Series E of $484 million in 2019 (before the pandemic) valuing it at well over $1 billion.
But more recently, the startup backed by the likes of SoftBank, Temasek, Lakestar, and others has been shoring up its position with alternative forms of finance.
In October, GetYourGuide closed a convertible note of $133 million. While it has yet to raise the equity round that would covert that note — it could be up to 18 months before another equity round is closed, CEO and co-founder Johannes Reck told me at the time — this latest revolving debt facility is giving the startup another efficient route to accessing money.
Unlike equity rounds (or notes that can convert into equity), revolving debt facilities are non-dilutive, flexible lines of credit, where companies can quickly draw down funds as needed up to the full value of the facility. After repaying with interest, they can re-draw up to the same limit again.
In that regard, revolving debt facilities are not unlike credit cards for consumers, and similarly, they are a sign of how banks rate GetYourGuide, and perhaps the travel industry more generally, as strong candidates for paying back, and eventually bouncing back.
“We are very happy to help GetYourGuide continue its growth trajectory during this extraordinary situation that we find ourselves in”, says Jan Kupfer, head of corporate and investment banking, Germany, at UniCredit, in a statement. “The successful financing also shows once again our unique tech advisory approach, where we combine our deep tech expertise with the broad product range of a pan-European commercial bank.”
“Extraordinary situation” is perhaps an understatement for the rough year that travel businesses have had.
There do remain parts of the industry that have yet to make the leap to digital platforms — experiences, the focus of GetYourGuide, is very much one of them — and that makes for very interesting and potentially big businesses.
But between government-imposed travel restrictions, and people reluctant to venture far, or mix and mingle with others, startups like GetYourGuide have essentially found themselves treading water until things get moving again.
Last October, GetYourGuide said it had passed 45 million ticket sales in aggregate on its platform, but that figure was only up by 5 million in 10 months. As we pointed out at the time, that speaks both to a major slowdown in growth and to the struggles that companies like it are facing, and it is very likely far from the projections the startup had originally made for its expansion before the pandemic hit.
It’s not the only one: air travel, hotels, and other sectors that fall into the travel and tourism industries have largely been stagnating or in freefall or decline this year. Many believe that those who will be left standing after all of this will have to collectively brace themselves for potentially years of financial turmoil to come back from it.
Interestingly, Airbnb presents an alternative reality, at least for the moment. It appears to have captured investors’ attention and since going public in December has been on a steady upswing.
Analysts may say that there hasn’t been a lot of news coming out about the company to merit that rise, but one explanation has been that the optimism has more to do with its longer-term potential and for how tech-savvy routes to filling travel needs will indeed be the services that people will use before the rest.
That could be part of the pitch for GetYouGuide, too. Chrestin said that the company believes that travel in the U.S. market, a key region for the startup, is looking like it might rebound in Q2 or Q3. Yet even if it doesn’t, the company has the runway to wait longer.
Chrestin noted that GetYourGuide has “reinvented internal processes” and is operating much more efficiently now. “If it weren’t for the global hardship this crisis is causing, we would look back and say it was quite transformational,” he said.
“The company is very well capitalized and fully funded to profitability. Even if the current travel volume stayed like this for three years, we would not run out of capital,” he continued. “We have sufficient capital even for that scenario, but we don’t think that will happen.”
Source: https://techcrunch.com/2021/02/15/travel-startup-getyourguide-secures-97m-revolving-credit-facility/
Revent — a new European early stage (pre-seed to series A) venture capital fund with an ‘impact’ focus — is coming out of the gate today, and is poised to reach its target of a €50m ($60m) fund, with the first close of that already completed. Focusing on environmental and societal problems, Revent will be looking to fund startups with both ‘purpose and profit’. Headquartered in Berlin and investing across Europe it will hone in on companies in Climate-Tech, health and wellbeing, and economic empowerment.
The founding partners are Otto Birnbaum, who was previously with French VC Partech, but also worked at HelloFresh; Dr. Lauren Lentz formality of McKinsey and an expert in impact measurement; Emily Brooke MBE, founder of Beryl, a micromobiilty startup; and Henrik Grosse Hokamp who worked previously for Partech’s late-stage fund.
Revent’s founder LP is Benjamin Otto, managing Partner at the Otto Group. Otto is part of the influential and powerful Otto family in Hamburg, founders of the Otto Group. Benjamin Otto also backed the launch of two other German VCs, e.ventures and Project A. Other investors in the fund include Max Tayenthal (N26), Sascha Konietzke (Contentful), Verena Pausder (Fox & Sheep), Luis Hanemann (e.ventures), Benjamin Roth (Urban Sports Club) and Dr. Florian Heinemann (Project A).
Revent has so far made four investments: Tomorrow Bank, a sustainable challenger bank based in Hamburg
; Sylvera, a London-based company that developed AI-enabled monitoring of nature-based carbon offsetting projects; Tmrow, a Denmark-based team building technology products for consumers and companies to understand and reduce their carbon footprint; and net purpose, an impact datastream for asset managers to understand the quantitative net impact of their portfolio, acting like a “Bloomberg” terminal of impact.
Commenting on the launch, Otto Birnbaum, Revent General Partner said: “We’re not acting as philanthropists, but rather aim to demonstrate that achieving very attractive financial returns is possible precisely because of the positive impact these companies will achieve.”
Benjamin Otto, Revent Anchor Investor said: “Social and ecological challenges have reached a new level of urgency. We depend on entrepreneurial innovation to find new solutions. With Revent, we want to create a platform for founders that not only provides them with optimal support but also contributes to a change in mindset: Entrepreneurial success and social-ecological impact can reinforce each other.”
Speaking to TechCrunch, Brooke and Lentz said the “purpose economy” has been accelerated by the Covid pandemic, which has amplified many of the planet’s systemic problems, such as inequality of access to healthcare, EdTech, creating massive changes in the world of work. Their mission, they tell me, is to positively affect the lives of 1 million people and to abate 5 million tons of C02. In order to achieve this, the fund will link fund carry to its impact goals.
They also say they are seeing a new wave of founders who want to tackle these problems. While overall VC investment is up only by about 2%, investment in ‘impact’ spaces such as ed-tech and mental health is booming.
As Brooke told me on a call: “We want to build a new version of venture capital, that authentically and genuinely prioritizes environmental returns and societal returns, along with commercial.”
Lentz said: “We think that there is this generation of founders who are looking for an investor who really brings both financing and an impact mindset. So not a classical impact-first impact investor, or a classic VC that is only looking at the growth trajectory and the financial upside returns. And we think that this founder is looking for an investor who really believes that these two things reinforce each other, and that the returns are going to be generated by positive societal impact, and that there needs to be a European home for this kind of founder.”
The main question is, how are they going to measure the impact?
Lentz said: “We view this holistically, and we start very early, so when we’re in diligence we go through a structured process of basically trying to assess the team, the founder DNA, how committed are they to achieving positive impact. We’re investing very early, usually pre-product, so we need to understand what is the motivation for this team. And then we try to systemically look at the different dimensions of impacts or how deep the impact, how many people will they reach, what additionality are they offering. We go through a structured exercise during the due diligence. And then we do something a bit unique which is we do an impact forecast. And so before we pull the trigger and invest we basically take what the founders have told us, and what we have learned through our conversations about possible growth trajectories, and we try to make some estimates and assumptions around the depth of the impact that the company will have. So it might be how much carbon do we think that the company will be able to beat or avert over the next eight years, or how many lives would they be able to significantly affect and to what extent… We’re not building a 20,000 line model, but we are trying to put some rigour around what we expect to happen on the impact side. Only if we anticipate that the company is going to have very significant potential upside from a commercial point of view and also very significant impact upside would we invest.”
From the chemical refineries that line the Gulf Coast to oilfields of West Texas, heavy industry has always been a big part of the economy in the Lone Star State.
Now, as venture capital moves in to the state as part of an exodus from California, a new fund is combining Texas’ industrial past with its high technology future.
That fund is Ironspring Ventures, which has closed its first investment vehicle with $61 million nearly two years after it launched its fundraising efforts.
The fruit of a partnership between Adam Bridgman and Peter J. Holt, the co-founders of an earlier investment vehicle called Holt Ventures, and Ty Findley, a former investor at G.E. Ventures and the Pritzker Group, the firm’s mission is to “accelerate digital adoption across legacy heavy industries,” according to Bridgman.
Each member of the Ironspring team has a long history with industrial technologies and deep roots in the Texas economy. Findley, a managing partner, grew up “in the middle of nowhere in East Texas” but comes from a family of entrepreneurs who built businesses along the Texas and Louisiana border.
“I joined up with our other co-founder and managing partner, Peter Holt,” said Bridgman. “That was really step one for us pursuing this broader mission of investing in legacy industry at the early stage of digital innovation. We were fortunate to find a strong cultural alignment and rare experience with Ty [Findley]. After co-investing over a period of time we got to know each other very well. We joined forces and it’s been a nice journey over the last year-and-a-half of formally launching and formally closing the fund in December.”
The first deal that the three men invested in together was Augmentir, a service providing information and support for remote workers. “Everything comes back to these words ‘digital industrial’ for us,” said Findley. “There’s this massive gap where people forget that almost the majority of GDP in this country is manufacturing.”
So far, Ironspring has invested in four portfolio companies, Mercado, which is developing a service to improve the import process; Icon Build, a company developing 3-D printing tools and technologies for the building industry; FastRadius, which brings design tools and services for prototyping and industrial design; and GoContractor, a safety and compliance management service.
The firm’s average check size is around $2.5 million and investments will range from $1 million on the low end to $4 million on the high end, according to the firm’s partners. That means looking for what the firm called “post-seed” deals.
And the firm is looking for technology that is transforming how businesses design products, build them, and provide services and operate across the wide range of industrial output.
“We’re trying to organize around those themes,” said Bridgman.
