Market One Capital raises a new €80 million fund to invest in market start-ups

Venture capital firms from Central and Eastern Europe (CEE) usually focus on their region – but Poland’s MOC has a history of going much further than that.

Unicorns supported by Western Europe, such as Germany Tier Scooter Company And the JOKR Grocery Delivery StartFounded in Berlin and now operating in New York.

It has just raised its second fund, worth €80 million, to invest in more early-stage European markets and network-impact startups.

MOC is another example of venture capital in Central and Eastern Europe, along with Czech doctrine And the Polish Inovand raised a new fund despite difficult conditions in the European project market.

compete in the west

When asked why a startup from France or Germany should consider inviting a Polish VC to the cap table, Marcin Zabelski, managing partner at MOC, joked: “And why not?”

But MOC has a longer answer, too. “Winning deals in Western Europe is much more difficult than in Central and Eastern Europe, but it is still possible when you have your specialty,” says Marcin Couric, who is also a managing partner. “To be a public venture capital from Poland and invest in the West is much more difficult.”

MOC, which launched its first fund in 2018, specializes in investing in network effects companies – where the value of a product, service or platform increases simply because the number of users increases. Roughly 70% of MOC’s first fund portfolio operates in this model – mostly markets but there are also some fintech and software startups.

This makes it easier to “sell” MOC to entrepreneurs in Western Europe, Couric says. “If you focus on the markets, if you have five, 10, 15 markets in your portfolio, it’s easier to win a deal with another because you’ve accumulated knowledge. If you talk to an entrepreneur early enough, and if you know their market and understand their business, you can You find yourself in very competitive deals.”

Nearly half of the fund’s first investment was in startups in Western Europe, including Tier and JOKR, French deeptech Pathway, British fintech Silverbird and Dutch marketing platform Convious. The Ministry of Commerce has also supported Poland’s most successful startups, such as Medtech DocPlanner and edtech Brainly.

As a Polish venture capital firm, MOC also has leverage against its Western peers: a unique understanding of the regional market. This knowledge can be essential for startups wishing to expand to Eastern Europe.

“For entrepreneurs who are building markets, Central and Eastern Europe is often a first-class expansive market. It is a large market that they want to reach but do not have enough experience. That is why they are looking for partners from this region who provide them with not only the capital but also the network and help them to Expansion,” Zabelsky says.

seed concentration

With the new fund, the Commerce Department wants to support about 30 new startups, most of which are in the pre-incorporation and incorporation stage. The initial tickets for the fund range from €200,000 to €2 million, with the possibility of investing up to €8 million in one company.

A third of the new €80 million fund comes from the European Investment Fund. Several individual and family investors also contributed, most of whom were entrepreneurs from Central and Eastern Europe. The fund has a maximum fund of 100 million euros, and the partners are currently in talks with additional investors.

Zabelsky adds that by investing in startups in Western Europe, which typically command higher ratings than startups in Eastern Europe, MOC is positioning itself well in the eyes of its investors.

“Most of our potential partners are from Central and Eastern Europe, and this is a good sign that we are investing in Western Europe,” he says. “It is likely that the valuations will be higher, and one can achieve higher returns.”

Zosia Wannat is a reporter from Sift for Central and Eastern Europe. She tweets from Tweet embed

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