International enterprise capital agency Cathay Innovation has introduced its third fund, focusing on € 1 billion ($ 1.05 billion) at a broad gamut of corporations and applied sciences world wide.
With Fund III, Cathay Innovation launches what’s going to absolutely be one of many largest multi-stage VC funds to emerge from Europe as soon as it closes, encompassing Collection A, B, and later-stage startups. The corporate mentioned it intends to function a lead- or co-investor, with investments starting from $ 5 million to round $ 80 million in dimension.
The brand new fund follows its $ 550 million second fund again in 2020, which – just like the inaugural fund earlier than that – was additionally a multi-stage fund. In tandem, Cathay Innovation, which is a part of the broader private-equity outfit often called Cathay Capitalhas additionally been getting into vertical-specific industries, having simply final month launched a brand new $ 110 million fund directed on the crypto sector. The month earlier than that, Cathay Capital itself launched a $ 500 million well being fund.
So in opposition to a backdrop of financial downturns, startup recessions and VC trepidationplainly somebody, someplace at Cathay Towers might have missed the memo.
“Regardless of the present market circumstances and uncertainty, we’re robust believers that the digital revolution will solely proceed to speed up, and that main tech corporations will do extraordinarily properly, exhibiting robust progress and pricing energy,” Cathay Innovation CEO and co-founder Denis Barrier instructed TechCrunch. “Within the subsequent 10 years, all industries face huge change as trendy digital infrastructure higher hyperlinks merchandise, buyer wants and the broader worth chain. In consequence, right now’s markets will likely be redefined and the businesses that cope properly with digital transformation may have the chance to guide a lot bigger markets than earlier than. ”
Cathay Innovation co-founder and CEO Denis Barrier. Picture Credit: Cathay Innovation
Cathay Innovation’s focus is about as broad because it will get, spanning nearly each nook of the economic spectrum, from fintech and mobility to retail and power. However behind what at first would possibly look like a scattergun funding ethos, there’s a technique. Companies typically need to forge relationships with complementary corporations from different industries, for instance as provide chain companions and even as paying clients, so by investing in such a variety of companies, Cathay may also help construct bridges throughout sectors.
We particularly constructed our funds to incorporate a various ecosystem of main multi-sector companies as not solely LPs (restricted companions), however as strategic companions to assist tailor our funding thesis to industries resembling healthcare, finance, shopper, power, mobility and logistics, ”Barrier defined. “This has a number of advantages, because it grants entry to invaluable {industry} experience and permits for cross-industry fertilization; it connects startups to potential companions or important clients that may assist them scale; and it helps increase the digital transformation efforts of our company companions whereas bringing innovation to life in real-world industries. ”
The core focus of the brand new fund will likely be on Collection A and B rounds; nevertheless, the corporate mentioned that it plans to carry sufficient reserves for later progress rounds, and can goal investments at corporations that fall below the UN’s Sustainable Improvement Objectives, incorporating good well being and well-being; first rate work and financial progress; {industry}, innovation and infrastructure; and local weather.
International norming
Whereas Cathay Innovation is on no account a location-specific fund, its roots lie firmly in Europe, having initially arrange store in Paris again in 2015 the place Barrier is now based mostly. Greater than half of Cathay Innovation’s international crew – amounting to almost 30 people – are additionally based mostly in Europe, and greater than one-third of its portfolio corporations additionally hail from Europe.
“Whereas we make investments globally, with our marquee funds primarily protecting Europe, North America and Asia, we have at all times maintained a robust European presence when it comes to native crew, LPs and portfolio corporations,” Barrier mentioned. “We have invested in lots of main European startups.”
Cathay Innovation’s Paris-based crew. Picture Credit: Cathay Innovation
Many of those startups have gone on to attain notable exits, together with Spanish electrical automobile charging startup Wallbox, which now trades on the New York Inventory Alternateand supply firm Glovo, which was lately acquired by Supply Hero. Extra broadly, Cathay Innovation has invested in 120 corporations, delivering two IPOs, 5 acquisitions and 19 unicorns within the course of.
That each one mentioned, since its inception seven years in the past, Cathay Innovation has expanded with new places of work and groups in North America, Asia and Africa, giving the VC agency inroads into profitable markets all over the place.
“We began Cathay Innovation to again rising startups remodeling key industries and with the idea that one of the best improvements come from all corners of the world – which can proceed with Fund III,” Barrier added.