Balderton Capital is an established European VC known for investments in Revolt and Wayve. Recently, the firm raised a total of $1.3 billion spread across two funds. The Early Stage Fund IX received $615 million, and the Growth Fund II received $685 million. The news was met with cautious optimism by industry insiders.
This development signals a resurgence in European VC after a period of sluggish performance following the ZIRP and post-COVID-driven bull-run of 2021 and 2022.
Balderton highlighted research showing that European VC funds have outperformed their counterparts in the U.S. over 10- and 15-year periods, according to data from Invest Europe and Cambridge Associates.
In an interview with TechCrunch, partner Suranga Chandratillake mentioned that the fundraising process went smoothly, with 80% of the funds coming from existing LPs. Additionally, a significant U.S.-based institution also participated in the fundraising.
Furthermore, European AI startups like Mistral, Wayve, and Poolside AI have been attracting substantial VC funding, comprising 18% of total European VC funding, as reported by Dealroom. This fundraising by Balderton follows similar initiatives by other prominent VCs in Europe such as Accel, Index Ventures, and Creandum.
Over the past year, Balderton announced investments in companies like Checkly, SAVA, Tinybird, Qargo, Huspy, trawa, Payflows, Scalable Capital, Lassie, Writer, Anytype, and Deepset.
Despite focusing exclusively on Europe, Balderton missed out on investing in foundational AI start-ups from Silicon Valley. Chandratillake explained that early-stage VCs like Balderton face challenges in backing companies that require massive capital injections to compete with industry leaders.
Looking ahead, Balderton aims to support emerging companies that use AI technology to solve specific problems. The firm remains optimistic about the opportunities in this space, as evidenced by their investment in Wayve, which raised the largest AI funding round in Europe.
Industry experts shared their thoughts on Balderton’s fundraising. Brent Hoberman of firstminute capital applauded the focus on Europe and the performance of European VCs. Susanne Najafi of BackingMinds praised the additional funding for European startups at both early and growth stages.
While some VCs supported Balderton’s strategic decisions, others like Andrew J Scott of 7percent Ventures emphasized the need for European VCs to make bold bets on foundational technologies to compete with the U.S. in areas like AI, space, and robotics.
This story was updated to include another quote from a VC about Balderton’s decision not to invest in Mistral.
