The new 'Rocket Internet Capital Partners' today successfully held its first closing, Rocket Internet announced this morning, with total commitments of $420 million of which Rocket Internet proper contributed $50 million.
In one fell swoop, that makes the fund one of, if not the, largest European Internet-focused one. Rocket says "further significant commitments are expected in the near-term", given "strong investor interest".
As a reminder, we reported about half a year ago that Rocket Internet was plotting a €1 billion fund mostly focused on late-stage investments. This is the first step for the fund to get to that point, as the fund targets a lifespan of minimum 9 years.
Investors in the fund were not disclosed, but Rocket says they included "institutional investors such as pension funds, asset managers, fund of funds, insurance companies and foundations as well as high net worth individuals".
From the press release:
"The Fund offers two strategic advantages to Rocket Internet. It will invest in Rocket Internet business opportunities, thereby streamlining and simplifying the funding process by reducing significantly its reliance on co-investors in individual portfolio company funding rounds.
Secondly, Rocket Internet increases its economic exposure to its portfolio companies through performance-based carried interest, therefore increasing Rocket shareholder value without dilution to its shareholders or taking on increased risk."
Important to note: the fund will not participate in seed investments in Rocket Internet-founded companies. Rocket Internet will have a 28% 'economic exposure' of the combined capital invested by Rocket Internet and the fund through its direct investment in a funding round as well as its commitment in the fund.