Spanish fund manager GED Capital is seeking to raise 40 million euros for its new venture fund Conexo Ventures. Conexo Ventures will make around 20 investments and target Iberian software startups.
Madrid, October 7, 2019. The independent Iberian alternative assets manager GED Capital has taken a further step in the development of its multi-product strategy with the launch of its maiden venture capital fund Conexo Ventures. This new activity of GED Capital in the venture capital segment adds to the already existing strategies of the GP in private equity and infrastructure.
With a target size of 40 million euros, Conexo Ventures will make around 20 investments, of which around 50% will be follow-up investments.
The fund, which has already received commitments of nearly 20 million euros, seeks opportunities in Iberian startups that develop disruptive software with scalable and defensible business models -preferably using Artificial Intelligence- for high-demand sectors such as: “Cybersecurity”, “Payments and Marketplaces”, “Finance and Insurance”, “Legal and Administration” and “Travel and Accommodation”. The fund focuses on investments in Series A rounds of financing, in startups with developed products that generate relevant cash flow after having demonstrated their acceptance in the market with metrics that support the investment thesis.
The Fund will seek to support teams of skilled entrepreneurs who are “exportable” to the United States to achieve the next rounds of financing (series B and C) in North America and, finally, the exit. The management team of Conexo Ventures has an active presence in Boston and Silicon Valley. This air bridge between Spain and the United States will serve as a fast track for the most innovative startups of Spain and Portugal that wish to grow in North America.
The startups in which the Conexo Ventures fund invests will receive legal, human resources and sales support for its international expansion. In addition, they will have the support of the management team for the syndication of future rounds of financing with North American venture capital funds.
The senior executive team of Conexo Ventures is composed of three partners with extensive experience in the world of entrepreneurship and venture capital investment:
· Joaquim Hierro, managing partner of Conexo Ventures and GED. Hierro has been a member of the investment boards and committees of all GED private capital funds since 2004. Previously, he was managing partner of PME Capital SCR (now Portugal Ventures, SCR), where he managed several growth, biotech and ICT funds (totalling 120 million euros).
· Isaac de la Peña, partner with 20 years of experience in the areas of technology and investment. He was co-founder and investor of the Inveready First Capital fund and partner and CTO of Ágora Asesores Financieros. Furthermore, he is a Sloan Fellow graduated from the Massachusetts Institute of Technology (MIT) in Boston, specializing in finance.
· Damien Balsan, partner with 25 years of experience in the technology industry. He has worked as head of NFC at Nokia and as head of point-of-sale agreements at PayPal. Throughout his career he has co-founded and sold several companies such as Way Systems (sold to VeriFone), Roam Data (sold to Ingenico) and LoopPay (sold to Samsung to create Samsung Pay in 2015).
The partners of Conexo Ventures will have an active participation in the strategy of the investee companies and will be involved in their operations together with the founders of the startups.
Both de la Peña and Balsan have a proven track-record of selling startups at multiples greater than 8x, while Hierro has several decades of experience in private equity and venture capital.
Conexo Ventures is a venture capital fund (FCR) domiciled in Spain and the fund manager is GED Capital Development S.A. SGEIC. The fund has been constituted and registered with the Spanish Stock Market Commision (Comisión Nacional del Mercado de Valores, CNMV).
Both GED and the management team have made significant commitments to the Conexo Ventures I fund, which has one of the largest but, at the same time, most selective pipelines in Iberia: since 2018 the management team has received more than 1,750 projects and, after an exhaustive analysis, has so far invested in only three technological startups:
· BNext is the first marketplace of financial, insurance and travel-related products in Spain where users can buy the products that best suit their needs with a single account. BNext also works with an electronic money institution regulated by the Bank of Spain, making it the first fintech to offer an account and card not linked to a bank. With more than 300,000 customers, BNext has an important growth project in the Mexican market.
· Buguroo is a Spanish startup, based in Alcobendas (North of Madrid), which develops cybersecurity and anti-fraud solutions through “Deep learning” for the protection of sectors with high exposure on the Internet. Some of the main Spanish banks, such as BBVA or CaixaBank, rely on Buguroo to protect their customers from phishing, malware and identity theft attacks. Buguroo is currently penetrating the Latin American banking market and its valuation has already multiplied by 4x in just one year.
· Kushki is a payment platform focused on the Latin American market that serves as a Gateway and Aggregator for companies wishing to enter the era of e-commerce. It uses artificial intelligence to reduce risks. Kushki’s products are easy to implement and integrate in emerging markets which often have difficulties in processing payments due to a lack of knowledge and/or developers. Kushki, which has a presence in Ecuador, Colombia and Chile, has multiplied its valuation by more than 5x in just eleven months.
Joaquim Hierro Lopes, managing partner of GED Capital, said: “For some time we had been wanting to expand our activity to venture capital and when we met the Conexo team we had no doubt that they were the right people to work with in this new private capital strategy that we will develop in GED. In this way, we broaden the range of alternative assets that our investors can access to generate attractive returns in the current environment of low interest rates.”
Isaac de la Peña, partner of Conexo Ventures, said: “The support of our fund will be fundamental to allow the access of our investees to the U.S. market via the fast track. Taking advantage of the capital efficiencies of Southern Europe, our internationalization strategy will serve, among other things, to obtain greater multiples of investment through exits in more developed markets. Proof of our excellent criteria for selecting and backing companies is that two of the investments we made have already multiplied their value by four and five times in less than a year”.
About GED (www.gedcapital.com)
GED is an independent fund manager founded in 1996 that operates in the lower mid-market segment. The firm currently manages more than €900 million through different vehicles of Private Equity, Infrastructure and Venture Capital. It has a universe of more than 50 domestic and foreign investors, including pension funds, funds of funds, insurance companies, family offices and financial institutions.