EUR 4 million invested with top VCs and future unicorns candidates: Movens VC’s summary of 2021
It has been an intense yet rewarding year. We were operating at full capacity, and to paraphrase Wayne Gretzky, “We took advantage of nearly 100 percent of the shots we had.” In total, PLN 17 million from (EUR 4 million) our fund went to eight startups from Poland, Lithuania, the Czech Republic, and Germany during 2021. Furthermore, all of our companies strengthened their international positions (including those in the United States). We have also done a lot to become the first choice fund for Polish/CEE companies, especially those operating in the AI/ML area and marketplaces, and eCommerce solutions.
To start with, Movens VC is an early-stage, Warsaw-based fund that supports the most ambitious Polish/CEE founders in the first stages of building European and global technology diamonds on a partnership basis. The fund’s capitalization is EUR 14M, with the ticket up to EUR1 M for one company. Before we launched the fund, we successfully built many technology companies.
We see our activities in the VC field not only through the hundreds of founders and projects we had the pleasure of meeting during the past year. It is also the ecosystem of funds with which we co-invest in the region. This group includes recognized brands and teams, such as Creandum, Early Bird, HTGF, Paua Ventures, Kaya, Inven, TDJ Pitango, Manta Ray, SMOK, Speedup, and Open Circle Capital. We believe that we can take our joint projects to great heights through cooperation.
We adopted a similar method when we expanded the number of Movens VC’s Limited Partners during 2021. After all, we just completed the fund’s second close and grown its capitalization to PLN 62 million (EUR 14 million). What for? The expansion of the LP base means that, in addition to PFR Ventures, we have 40 investors from Poland, Germany, Spain, Holland, Norway, and Australia. These LPs are often seasoned entrepreneurs who have established brands, such as Blue Media, Verestro, netguru, Adform, Performance Media, Whitepress, Acxiom, K2 Internet, Digital Virgo, Interia, and many others.
We also place significant emphasis on co-investments with the best business angels — those who add value. Private investors from almost every continent have participated in rounds with us, investing almost PLN 9 million (EUR 2 million) in our companies.
Not only has Movens invested in many unicorn prospects over the last year (more on that below), it has also developed new, tighter relationships with over 200 funds based in Western Europe and the United States. This doubles as a broad awareness campaign about Polish AI/ML businesses targeted at important recipient groups (leading VC funds, founders, and advisors).
Vue Storefront, StethoMe confirm their global potential
The A round in Vue Storefront made financial news headlines at the end of 2021. The firm completed one of the biggest A rounds in Polish history, raising USD 17.3 million (PLN 69 million) at a pre-money value of USD 63 million (PLN 250 million). With a current worth of almost PLN 320 million, the company is among Poland’s top ten most valuable startups. What excites us is the addition of three new high-profile co-investors in Vue Storefront: Creandum (Spotify, Bolt), Earlybird (UIPath, N26), and Paua Ventures (Pipedrive). They are accompanied by angels, such as Evan You, developer of Vue.js; Mathias Christensen and Christian Bach, Netlify founders; Paul St. John, former Github sales head; and Heini Zachariassen, Vivino founder. This signifies that the best in the industry trusts the company’s sustained and rapid increase in value.
We think that our other investments, including those made just after we officially started in 2020, are on a unicorn trajectory. Just one remarkable example is StethoMe, one of the final 20 firms in the prestigious Startup Battlefield. The firm was chosen from among 1,200 disruptive companies worldwide (the highest number ever) and performed on a virtual stage during TechCrunch Disrupt 2021. We have more innovative technologies in our portfolio, so we anticipate that additional firms from our ecosystem will join their ranks shortly.
AI, Health, marketplaces: Movens VC investment selections in 2021
The analysis of our deal-flow over the last year reveals that the Polish and Central European startup ecosystems are expanding at a rapid pace. There is an increasing number of well-prepared projects with high potential for worldwide success. As a fund, we are referred to as “generalists,” yet we concentrate our efforts on two categories of companies:
● Using AI/ML to revolutionize the operations of major industries
● Startups that are capitalizing on network effects (marketplaces) or providing eCommerce solutions.
Listed below are a few investments that fit this description and that made it into our portfolio:
· Sky Engine AI secured USD 1.2 million in an investment round, with Movens contributing USD 0.45 million (PLN 2 million). The primary purpose of the round was to finish the SkyEngine platform, which would provide training datasets for AI computer vision in the corporate sector (via a SaaS model). This investment has provided the firm with the opportunity to become a worldwide industry leader in synthetic data and one of the primary catalysts for companies developing their metaverses. Sky Engine was Movens VC’s first co-investment with High-Tech Gründerfonds Fund, a renowned German evergreen fund with a portfolio worth almost EUR 1 billion. We were impressed by the team’s experience in AI and rendering engines (gained, among other places, from CD Projekt Red), groundbreaking technology, and the pipeline of top corporate clients from the US, UK, Germany, South Korea, and Poland.
· The Villages Network is an entirely different type of investment. It is a SaaS marketplace that links parents of young children (ages 1–6) with micro nurseries or preschool operators, while teachers, nannies, and work-at-home mothers can launch their own care centers with the firm’s help and support in the early phases of the operation. The “village” uses a SaaS solution for marketing, operations, parent communication, payments, and lead management as well as a community forum and an online course platform. The business raised roughly USD 0.7 million in this round. As lead investor, Movens VC has partnered with industry-specific company angels for this investment. The company has acquired around 100 Villages during the first six months and aspires to develop 250 Villages this year. Where? The obvious choice was Germany and the Visegrad Group.
· Our next investment is Woltair, which operates in the cleantech area. The company also works in a SaaS-enabled marketplace model. It provides end customers with a simple and transparent process for selecting, purchasing, installing, and maintaining solutions for the photovoltaic or HVAC (heating, ventilation, and air conditioning) sector. The company has consistently grown at a four- to five-fold rate per year. Currently, the company offers installation and service solutions for heat pumps and other products, such as gas furnaces, electric boilers, heat recovery units and air conditioners, and photovoltaic panels, and has started offering integrated solutions.
Woltair has a technology platform that combines an algorithm-based quote generator, scalable execution processes, and distributed delivery. We invested as part of the second close of a EUR 3 million funding round, together with CEE region-recognized investors, Kaya VC fund (previously ENERN), and Inven Capital, a cleantech-focused investment firm. In light of the developments in Poland, it is estimated that Woltair’s sales will continue to expand rapidly.
· The last weeks of 2021 also brought news of our pre-seed round in Doctor.One. The company has recently started offering doctors a pioneering mobile app to monetize an ongoing relationship with a patient. The team consists of experienced entrepreneurs, Tomasz Rudolf and Maciej Malenda, a manager with extensive experience in large, innovative medical companies (Infermedica, Medicover). Their experience was one of the major reasons we invested PLN 2 million (EUR 450 thousands) in Doctor.One. Another factor that convinced us of the enterprise’s viability was the revolutionary, “doctor-centric” character of the service and the size of the market — over 13 million doctors globally — a sizable portion of them (40 percent in Poland) had long-term connections with patients.
· The great example of companies, that uses AI to disrupt a big industry is Talkie.ai. — one-stop-shop for voice automation. It enables customer service teams without writing a single line of the code to build, train, test, run and monitor AI-driven virtual call center agents. Their clients get 24/7 access to the information and services they need via voice, while businesses can spare even 70% of regular contact center costs. They have clients in UE and the US.
· Another company from our selection that is worth a special mention is Nethansa, a Polish-German startup that uses a sophisticated sales and logistics automation system to enable sales on Amazon, Kaufland, and other marketplaces. The system thoroughly monitors its contractors’ accounts and provides end-user support in six languages. Nethansa’s proprietary system employs AI to assess competitors’ offers and optimize the prices of products on the market, thereby leapfrogging its customers’ margins. Nethansa allows its customers to sell in all the countries where Amazon operates.
Academy for Talent, Talent Base, and Packhelp and Whitepress
For us, 2021 also marked the launch of several initiatives to support founders and talent. After all, this is what determines a company’s value and potential, in our opinion.
The Movens Academy, an educational initiative for top founders, has increased the training and workshops that it conducts. We started Pricing for Startups, a unique pricing competency shared by Movens Capital’s partners. Another new project is the Movens Talent Pool, a platform for people interested in joining teams at our startups. And it looks like there will be a record number of them in 2022!
Last but not least, 2021 reaffirmed the Movens Capital management team’s investment strategy. It is worth mentioning two firms in which we invested before opening the VC fund. The first is Packhelp, which was founded in 2017. Movens was the largest investor in a EUR 350,000 pre-seed round. Meanwhile, the company recently announced EUR 40 million Series B financing round. The second notable venture tied to the Movens team is the content marketing platform Whitepress, which Artur Banach invested in as CEO of Netsprint Group (then mostly owned by Dirlango and Innova Capital funds) in late 2016. RTB House, a multinational technology business specializing in adtech, purchased Whitepress, just over four years later. This transaction gave up to a 12-fold return on investment to earlier owners and the company’s founders.
If you have a company that fits our investment strategy — please contact us: https://movenscapital.com/pitch-us/. We will be very happy to talk.