London-based Ada Ventures, an inclusive VC firm backing breakthrough ideas, is today announcing the final close of a €73.7 million fund to back a truly diverse cohort of early-stage founders.
A range of prestigious institutional investors have backed this fund – the second from the firm – including the British Business Bank, The University Of Edinburgh, Big Society Capital, Legal & General Capital, Atomico, the The Export and Investment Fund of Denmark (EIFO) and Molten Ventures.
They have been joined by a number of founder investors, including Taavet Hinrikus, founder of Wise, and Illusian, family office founded by Ilkka Paananen, co-founder and CEO of Supercell.
Launched in 2019, Ada Ventures has backed a range of success stories, including Huboo, Boundless, Bubble SideQuest, Spill, Materials Nexus, Greenworkx, Micrographia, Gizmo, and Tooth Fairy. Ada Ventures Fund I is a top quartile performing fund and the current portfolio is on track to generate in excess of £100m net revenue over the coming year. Ada Ventures portfolio companies have attracted co-investment and follow-on funding from leading firms including GV, NFX, DCVC and Index Ventures.
Check Warner, Co-Founding Partner at Ada Ventures, commented: “We’re thrilled to announce the final close of our second fund and share more data around the diversity and performance of our portfolio. We believe these metrics show just how powerful and effective the Inclusive Alpha approach is. We’ve worked incredibly hard over the last five years to develop the systems and processes to turn our ambition to build a truly diverse and inclusive fund into reality. Strong returns are strongly correlated with inclusive investment. We want other funds to copy this blueprint. The excuse that diverse talent isn’t ‘out there’ is a cop out. We have proven that you can build a thriving, inspiring portfolio of diverse founders building breakthrough products and hugely valuable businesses.”
With this capital, the team will be making investments of between £250k and £1.5 million in pre-seed and seed stage startups, with a significant amount allocated for follow-ons. With 12 investments already made from the second fund, the Ada Ventures team plans to make between 10 and 12 investments per year in companies building breakthrough ideas across climate equity, economic empowerment and healthy ageing.
The fund has developed and now pioneers an ‘Inclusive Alpha®’ approach to its investment decisions; a belief that backing ‘alpha’ ideas and founders can coexist with a commitment to inclusion. This investment strategy centres on the ability to beat the market using funds derived from an inclusive infrastructure and investing approach. Ada Ventures embeds this commitment to inclusion at every stage of the investment process.
This includes providing access to mental health support for founders and a European-first commitment to supporting parents in their portfolio with the cost of childcare, an initiative which, since launching in October, has already been embraced by nearly 15% of the firm’s portfolio companies.
Chris Hopkins, Managing Director, Venture Capital, Legal & General Capital, said: “We are pleased to have invested in Ada Venture’s second fund and support their wider investment strategy to broaden out access to capital and address the lack of diversity within the UK & European VC ecosystem. Diverse teams drive growth and better outcomes, and Ada Ventures inclusive approach is targeting the emerging cohort of startups who are developing innovative solutions for society’s greatest challenges. The oversubscribed second fund is a fundraising success story and signals the growing industry recognition on these issues.”
Lars Nordal Jensen, Head of Fund Investments at The Export and Investment Fund of Denmark (EIFO), added: “We are delighted to join Ada Ventures as investors in their second fund, as they keep expanding their Inclusive Alpha approach internationally. Ada Ventures is led by a savvy team that has developed a systematic and more inclusive approach to venture capital, which is why we believe they are well-positioned to capitalize further on the underlying business opportunity that exists when you invest in a more diverse set of founders. Ada’s attitude to investments shows that you don’t need to sacrifice great returns for your LPs, in order to build a more diverse portfolio.”
Read the orginal article: https://www.eu-startups.com/2024/03/ada-ventures-closes-e73-7-million-second-fund-to-continue-backing-inclusive-alpha-founders/
