Monday, September 25, 2023

KWM assists Enzo Ventures with new fund launch

King & Wood Mallesons has helped Enzo Ventures with the launch of Enzo Ventures I F.C.R.E. fund backed by Moira Capital, with a target size of €20 million, which aims to enter early-stage startups in the European ecosystem.


According to El Referente, Enzo Ventures has announced the launch of Enzo Ventures I F.C.R.E. to invest in European seed-stage technology startups. This second vehicle aims to raise €20 million in capital. It is backed by Moira Capital Partners -which acts as management company- and nearly 10% of its capital is committed by investors from the previous fund.

Enzo’s idea is to invest with tickets of between €100,000 and €500,000 per company. Those companies in the portfolio that do better will be accompanied in their subsequent rounds, with up to €3 million, through a special ad hoc vehicle, as Moira does. This vehicle will be financed 20% by the fund and, for the remaining 80%, they will give them the option of co-investing in their own LPs. “Together with the follow-on or co-investing with our LPSs, we will manage close to 40 million. In other words, we will expand capacity far beyond what is usually a standard seed fund,” explained Edgar Vicente, founding partner of Enzo Ventures.

This new fund comes a year after the launch of the firm’s first micro fund: Enzo 0, which was endowed with €1.5 million. “Since we launched Enzo 0, our strategy was to raise a larger one as soon as possible”, explains Vicente: “We are taking advantage of the macroeconomic moment in which we live, with a lot of liquidity and a high interest in a counter-cyclical asset such as Venture Capital.”

Enzo Ventures invests in disruptive startups with a strong technological component, in any sector and geography in Europe, with a special focus on the Climate Tech, Fintech, and Saas sectors. In terms of investment timeframe, the VC will focus on startups that are in the Seed stage.

“The idea is to carry out the first operations from the new fund by the end of the first four months of 2022. In order not to trade both funds in parallel, we will buy back the portfolio of 9 companies of the initial Enzo 0 micro fund from the Enzo I fund at an above-market multiple. In this way, we buy back the startups’ shares by offering a partial liquidity event to the initial investors”. Enzo’s idea is to encourage early investors to reinvest and, at the same time, allow Enzo I to start operating with portfolio companies, “with small stakes but with the option to do follow ons in our investees,” Enzo said.

Venture Capital expects to carry out all its investments within two to three years, depending on the speed at which the market moves. “The Spanish ecosystem is positioning itself as a benchmark at European level, with great exits that positive feedback to generate more entrepreneurial ecosystem. Clearly, every year that passes, the added value of invested capital and companies that achieve “unicorn” status will be greater,” concludes Enzo’s founding partner Edgar Vicente.

KWM advised Enzo Ventures with a Funds team led by partner Ildefonso Alier, along with associate Enrique Torné Palacio.

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