After a record year for start-up funding rounds, venture capitalists continue their buying spree in 2022.
German start-ups collected a total of 17.4 billion euros from investors last year.
Germany and Europe are attracting far more money and attention these days than was the case a few years ago.
On Tuesday, two fintechs from German-speaking countries announced larger financing rounds.
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Fintech Moonfare announced a $35 million funding round.
London-based venture capital fund Vitruvian Partners invests in the fintech, which in turn enables individual investors to invest in private companies.
The funding follows a Series C round in which Moonfare has already raised $125 million.
The money is to flow, among other things, into the market entry in America.
Expense management fintech Yokoy also announced a $80 million Series B funding round in Zurich.
The overall valuation amounts to 107 million dollars.
The round was led by American venture capital giant Sequoia Capital, which has backed founders such as Apple's Steve Jobs and Google's Larry Page.
Matthew Miller, partner at Sequoia, explains in an interview with the FAZ why more money is now flowing into European start-ups: "In Europe there has always been a great wealth of talent and a great willingness to work with venture capitalists.
These talents are now increasingly going into start-ups.
Covid-19 has also been a catalyst for more and more amazing companies to emerge in smaller cities and different regions outside of the regular tech hubs.”
Fast and stable growth
This is the aspect that impressed Miller and Sequoia about Yokoy.
Within its two-year existence, the fintech was able to build up a workforce of 150 employees in six different countries and win over 500 business customers.
Fast and at the same time solid growth are a decisive criterion for an investment decision, says Miller.
According to Yokoy, the market for expense management has reached a size of 200 billion dollars.
Co-founder and boss of Yokoy, Philippe Sahli, thinks his company can offer added value through artificial intelligence in contrast to the numerous competitors.
While invoices and receipts passed through far too many hands in classic expense management, Yokoy tries to only present the receipts to those who need to manage them or make decisions about them.
The costs for processing a receipt could be reduced by 90 percent.
“Also, most companies think in silos when it comes to spend management.
They implement a billing solution, a card solution, and so on.
Yokoy offers everything from a single source.”
Robert Lacher of Berlin venture capitalist Visionaries Club, who also invested in Yokoy, describes how the culture for seed financing is changing in Europe: “Europe is an incredibly fragmented market.
American funds therefore find it difficult to gain access here.” American venture funds therefore often choose to use European funds, which are already well networked locally, to weigh up their investments.
Traditional knowledge for start-ups
The expertise of the Visionaries Club, which is made up of start-up founders and family businesses, is spread across Europe.
Members are well connected in Europe, such as the founders of the travel company Flixbus and a legacy of the electrical appliance manufacturer Miele.
According to Lacher, American funds and the start-ups in which the Visionaries Club invests could use these networks to open up and scale the various markets in Europe.
Start-up entrepreneurs in particular benefit from the knowledge of others who have already gone through all the phases of founding a company.
Founders are confronted with decisions and complexity on a daily basis, as they often have to introduce a non-existent product into a non-existent market from scratch with a company that often does not yet exist - the experience of other founders can help a lot here to shorten paths, says laughter.
There is still a lot to develop, Lacher continued, but the environment is becoming friendlier.
Miller is confident that Sequoia will strengthen its presence in Europe with additional staff.Keywords: