London-based VC firm Frog Capital has announced the first close of its second scale-up fund, which is expected to accumulate over €150 million. The fund is dedicated to European software companies that earn around €5 million in annual revenue.
More specifically, the firm selects software companies that deliver in two main areas: smart data (analysis and insights) or digital infrastructure (“disruptive efficiency”). Following a “scale-up methodology,” operational focus is on day-to-day execution, forward planning, and long-term business resilience. Portfolio companies include German proptech McMakler, British fintech Azimo, and B2B payment platform Modulr. “Scaling a company from 50 to over 500 people is very intense. CEOs are increasingly looking to partner with specialist investors like Frog who have been through this phase before and can help avoid the pitfalls experienced by others,” said Mike Reid, senior partner and one of the founders.
Given all the Brexit uncertainty, the European Investment Fund, which invested in Frog’s first fund, has yet to commit this time around. Reid explained, “The EIF investment team seem keen, but the powers that be seem to have halted discussion with all UK based funds right now.” The firm remains confident that the British Business Bank and other UK financial institutions will fill the void.