Niklas Zennstrom, CEO of Atomico and co-founder of Skype.
Simon Dawson | Bloomberg | Getty Images
LONDON — Atomico, an early investor in top European tech companies including Stripe and Klarna, announced on Monday the launch of two new $1.24 billion funds to back emerging and growth-stage startups in the sector.
The launch of Atomico’s sixth tranche of new funds, including a $754 million growth-stage fund for startups raising pre-IPO funding for their Series B rounds, and a $485 million early-stage fund, marks a milestone for European tech The rebirth of industry.
According to a report written by Atomico last year, venture capital investment in European technology startups will almost halve to US$45 billion by 2023, compared with US$82 billion the previous year. Atomico said at the time that the decline was a reversal of the sharp rise in tech valuations before the pandemic.
In 2023, the combined value of all private and listed technology companies in Europe will total more than $3 trillion.
The size of Atomico’s new fund is more than 50% higher than the $820 million raised in its previous round of funding, Fund V, in 2020. MicrosoftIt owns video calling application Skype, which already supports some of the best-known companies in the European technology sector.
“European technology is maturing,” Zennström said in a statement on Monday. “Seizing this opportunity requires ambition, hard work and commitment from founders, who in turn need investors with the experience and vision to outperform market cycles.”
He added: “Data shows that Europe leads the world with a large number of new start-ups at an early stage. Our new fund gives them the necessary firepower to level up and achieve global scale – from Europe.”
The new funding comes as two of Atomico’s main portfolio companies, Stripe and Klarna, have come under scrutiny amid speculation of imminent IPOs. Online payments giant Stripe, whose latest secondary offering of shares was worth $70 billion, has long been viewed as a potential IPO candidate.
Meanwhile, a person familiar with the matter told CNBC last month that Klarna was discussing a secondary stock sale with investors to provide them with liquidity ahead of a highly anticipated IPO. Sources said at the time that Klarna was valued at billions of dollars in public secondary markets.
Exits are a good thing for venture capital and private equity funds because they provide the opportunity to cash out and profit from equity investments, many of which are typically held for 10 years or more. There haven’t been many big tech companies going public in Europe this year, but investors are hoping the IPO window will reopen in 2025.
About The Author
