Index Ventures, the firm known for backing online video-chat service Skype at its early stages, said on Tuesday that it had raised 400 million euros ($541.62 million) for a venture fund focused on early-stage investments.
The new fund, which comes just two years after Index announced its previous 350 million euro early-stage fund, underscores a continuing increase in investors’ interest in venture capital. With a new 400 million euro fund, Index Ventures will stick with its global strategy, but perhaps with more of a U.S. twist.
“In some ways, we are going to be more present in the U.S. than we were in the past,” Danny Rimer, a San Francisco-based partner at Index, said in an interview. “You’re going to see earlier-stage investments that come out of the U.S.”
Rimer’s investments include Los Angeles-based fashion company Nastygal, San Francisco-based artificial-intelligence gaming developer Anki and San Francisco-based file-storage company Dropbox.
Index Ventures, which was founded in Geneva, has seen some big outcomes in recent months. Over the last year, one portfolio company, Helsinki-based gaming company Supercell, sold a majority stake for $1.53 billion to two Japanese companies. Monsanto Co (MON.N), the world’s largest seed company, bought another, San Francisco-based Climate Corp, for $1.1 billion.
But Index’s most impressive accomplishment has come via recent initial public offerings, including five over the last year at valuations of $1 billion or more.
Those comprise online food-ordering company Just Eat Plc (JE.L) and Candy Crush owner King Digital Entertainment Plc (KING.N), both based in London; Paris-based online advertising company Criteo SA (CRTO.O); San Francisco-based help-desk software company Zendesk Inc (ZEN.N); and Santa Clara, California-based data-center company Arista Networks Inc (ANET.N).
The latest fund’s roughly 80 investors, known in the industry as limited partners, are about half U.S.-based and half Europe-based, Rimer said.
Returns for venture capital are steadily improving. In the 10 years to Dec. 31, venture capital has returned 9.7 percent annually, compared with 7.4 percent for the Dow Jones industrial average .DJI, according to a report from consultancy Cambridge Associates.
Until last year, 10-year venture returns had lagged the stock market, reports from Cambridge Associates show.
(Reporting by Sarah McBride; Editing by Lisa Von Ahn)
Photo courtesy of Shutterstock.
Take your pick!
- Buyouts delivers exclusive news and analysis about private equity deals, fundraising, top-quartile managers and more. Get your FREE trial or subscribe now.
- VC Journal provides exclusive news and analysis about venture capital deals, fundraising, top-quartile investors and more. Get your FREE trial or subscribe now.