A new early stage investment firm is de-cloaking in London today. Three prominent Angel investors on the tech scene in London – Stefan Glaenzer, Eileen Burbidge and Robert Dighero – have been operating out of their White Bear Yard base in Clerkenwell for just under a year. Rumours circulated that they were looking to raise a real fund to continue their work, and now the news is about to break (ok, now it’s broken).
Passion Capital (@passioncapital) is a brand new fund aimed squarely at early stage tech startups and has closed its first investment at £37.5 million ($60 million). They anticipate making about 50 investments, where the average investment size is likely to be £150k-£200k at a time. But they say they will go as small as £15k-£50k and also “most certainly higher” than £200k depending on the situation. They are being pretty open. Here’s their investment strategy and they’ve even published their term sheet.
Prior to establishing the fund the three partners have been intimately and directly involved as either founder or earliest executive in four of the most significant European technology success stories (measured by market cap on exit) over the last 10 years (Ricardo.de, Skype, Last.fm and QXL/Tradus). This is a crack team, in other words.
This first fund for Passion comprises significant funding from the private sector, family funds and high net-worth individuals. In addition the UK Government has also invested £25 million via the the tenth Enterprise Capital Fund (ECF). This is a great example of where private investors can use the government-backed ECF scheme to de-risk their funds. Participating is Capital for Enterprise, an ECF programme intended to address a long-term structural weakness in the provision of risk capital for SMEs in the UK – it is wholly owned by the Department for Business, Innovation and Skills.
Stefan Glaenzer said “We’re passionate about innovation and disruption and building world-leading companies – not just about “models”. And our success in raising this fund shows the confidence from private investors and the UK Government in our track record and vision.”
Glaenzer and Burbidge first setup White Bear Yard in July 2009, a space with 7,500 sq ft in London in which to house their startups. But this was no incubator – merely a convenient way to house some of their investments close by. In early 2010 they were joined by Robert Dighero and the previously invidividual Angels started operating a 3-person informal partnership.
Between them they’ve invested in more than 50 startup teams across Europe, Asia and in the United States, but in London they have most recently been most known for investments in PickLive, Flattr, Timetric and Smarkets.
As part of the UK Government structure, the fund will focus primarily on business for the benefit of the UK economy (so it’s easiest to meet this requirement if the startup is a UK limited company), but otherwise if there’s service from the startup to the UK market and/or business development/sales/dev in the UK that will probably satisfy the requirements as well.
Glaenzer was last year named the best angel investor in Europe by readers and judges on The Europas and was also the first investor and executive chairman of Last.fm, seeing that company through to its sale to CBS (2007 USD $270 million). Prior to that Stefan was co-founder of Ricardo.de, one of the first European online auction and classified sites, sold to QXL.
Burbidge was investment director for private early stage VC firm Ambient Sound Investments, founded by the Skype founding engineers. Prior to that, she was products director for both Yahoo! Answers and Skype. She was also ranked #11 in The 100 most influential technology investors in Europe according to a PeerIndex ranking.
Robert Dighero was the former CFO of QXL/Tradus plc, sold to Naspers (2008 £1 billion) having guided the company from its founding to listing on four public exchanges. Robert was previously, at one point, CFO and founding executive of AOL Europe.