A prominent European VC firm, which has backed Revolut and Spotify, says it will not raise any new generalist VC funds, undertaking a “strategy shift” which will instead see it focus on raising returns from its portfolio companies such as Helsing and Neko Health.
In a letter posted on its website, Lakestar founder and chairman Klaus Hommels explained the rationale behind the move, saying that the European VC market was undergoing a “profound transformation”, citing structural challenges that demand new strategies.
Hommels said:
"Capturing and delivering exceptional returns to our Limited Partners is a task I want to give my undivided attention. Therefore, going forward both Lakestar’s and my focus will be on maximising the potential of the existing portfolio and we will not raise any new generalist venture funds as we have in the past.
"We will focus on the development of targeted new investment products to help our portfolio companies grow, and seize other emerging opportunities. Lakestar’s future investments will be larger, more concentrated, and made with own capital, allowing greater agility and freedom to pursue the big, visionary bets that have always defined our work."
In the letter, Hommels said that Lakestar's priorities lay in helping portfolio firms reach their full potential, naming Revolut, Helsing, Isar Aerospace, and Neko Health as examples.
He also said he would back "promising ventures" started by the Lakestar team as they "embark on their own entrepreneurial journeys".
Lakestar, which has offices in Berlin, London and Zurich, has raised more than €2bn over the past 12 years, according to the FT. Hommels added: "We are on track to have raised close to $500 million by year end through our newest vintage of funds."
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