Startups in Europe, faced with a continuous economic slowdown in the region, continue to fight fundraising. Meanwhile, European VCs that hide their bets by focusing on startups that have a world / American room in mind – or are already in the United States – see a lot of LP interest. Techcrunch learned exclusively that Frontline Ventures raised $ 200 million in two funds, named Growth and Frontline Seed, to continue to make betting through the pond.
It is not the only one: Giant Ventures in January closed two new funds totaling $ 250 million to invest in startups on both sides of the Atlantic.
Frontline had the reputation of investing in Europe and North America; Its new funds will continue to follow this strategy, specifically focusing on B2B software companies. Following wider trend lines among the other VC in the region, the new seed fund will promote European companies, while the growth fund will focus on American startups.
Frontline believes that the American scaling, generally, is very likely to succeed when they expand their operations on the other side of the Atlantic. “Although it is a traditionally undervalued market, Europe represents more than 30% of world revenues from the most efficient B2B software companies for the IPO,” said Brennan O’Donnell – The Co -Dirigent of Frontline Growth with Stephen McIntyre – in a press release.
“Traditionally undervalued” is a well-used sentence applied to the landscape of the company of Europe. And statistics detailing how funding has dropped since 2021 does not help. However, things are not as bad as the headlines seem to say it once you have stopped comparing recent investment trends during boom hours of 2021 and early 2022. Capital last year that in 2019, according to a report by the ORRICK law firm. And Europe was the only large region to see the investment levels remain above pre-pale standards-Asia and North America were both bad by this metric.
O’Donnell and its frontline partners have spoken on the value of Europe as a market for some time and even corroborated it with some research on their own. Frontline wants to ensure that her American companies do not leave money on the table by not extending to Europe when they should.
Extension roadmap
O’Donnell told Techcrunch that when Frontline helps portfolio companies to navigate to another market, it focuses on the calendar, the strategy of marketing, talents and design and location organizational.
It is order of importance, and the location of a company should be a derivative of the three previous aspects, said O’Donnell. “In the end, the location comes down to the place where your customers are and the talent base you need to effectively support these customers is.”
Frontline has already put this framework in action in recent years, supporting portfolio companies such as the HR software company Lattice and the Vanta compliance platform with expansion in Europe.
Lattice increases $ 175 million to an assessment of $ 3 billion for its people’s management platform
“The network extended at a time when it was not easy,” said O’Donnell. Although the company put its action plan during the pandemic, when people did not actively arrive at planes, there was also a feeling that the DIP 2020 would not last, he said, adding that there were rear winds for HR Tech. Quick advance for a few years, and this decision proved to be “very successful”.
One of the frontline traps warns is “Success Amnesia”: it is not because a company enjoys a certain level of success in the United States.
“Vanta grew up as quickly as during our first 18 months in Europe thanks to the Frontline councils,” said Christina Cacioppo, co -founder and CEO of Vanta. “We have tripled our customers, quadrupled our team and cemented Vanta as a world market leader thanks to Brennan, Stephen and the front line team.”
In addition to its partners and offices in London, Dublin, Palo Alto and New York, Frontline has also built a community of leaders from the European region and the Middle East to form a network that its portfolio companies can operate. “In the past two years, we have gathered a community for the top 200 to 250 VPS and GMS from EMEA, and we organize regular events.”
Speaking on the current company’s current portfolio, O’Donnell said that he was planning an IPO for one of his investments, probably one of his mature startups at the growth stadium – in the next 18 months, although he did not specify which one.
Speaking of first -line seeds, O’Donnell noted that the company has “particularly solid history when it comes to helping companies to raise their A series.” Since pre-grained and seed investments have not slowed down as much as subsequent stages, avoiding this bottleneck could be useful for European startups in the hope of becoming transatlantic scales, or perhaps even IPO candidates.
Frontline Ventures de Dublin collects a new seed fund of $ 83.8 million for European B2B startups