With 2023 approaching, it’s a 1 in 20 year moment for founders at the forefront of tech innovation to join forces with experienced, radically supportive investors and solve the world’s greatest problems

The 2022 EQT Ventures team, united from across Sweden, the US, UK, France and Germany

“To move from the old to what is about to come is the only tradition worth keeping.”

These words from Marcus “Dodde” Wallenberg, in whose family EQT has its roots, have always defined our approach. As 2022 comes to a close, they’re all the more relevant. Against the backdrop of Russia’s invasion of Ukraine, soaring inflation and tightening monetary policy, investors and tech founders have been scrambling to adjust to an uncertain world. At the same time, global challenges have accelerated innovation and entrepreneurship: it is in periods of doubt that the future success stories are written, and the most experienced, radically supportive investors play a key role.

Like the tech startups we invest in, we aspire to be “what is about to come”, backing ambitious founders as they capitalise on this chance to solve some of the world’s biggest challenges and disrupt the old incumbents. Equipped with a new €1.1bn fund, we’re more excited than ever to support the defining technologies of the future and see Europe’s community of 160,000+ startups flourish in the face of fierce macro headwinds.

Even at the end of the most chaotic year in tech we can remember, we believe the best is yet to come.

Lars Jörnow, Partner

The Big Picture

Years of loose monetary policy and the effects of the pandemic and war have slowed growth, triggered inflation and disrupted supply chains. It’s a tough time to start a business, but challenges create opportunities for the most driven innovators.

And it’s in that space we see the most promise going into 2023. Despite the market turmoil and the 44% year-on-year drop in European venture funding in Q3, investment in purpose-driven technology has ramped up and emergent categories are thriving. While we’re far from where we need to be on climate change, climate tech firms have enjoyed an investment surge, with more than a quarter of all VC funding going into the sector. Europe is at the forefront, with fast-moving impact startups like Heart Aerospace and Einride spearheading change and encouraging larger players to join them on their mission.

Fund Updates

We launched Ventures III: Europe’s largest venture fund dedicated to early-stage tech start-ups. With a focus on Seed to Series C investments, we’ll use this funding to empower innovations across Sustainable Industrials, Fintech, B2B Software & Social.

Our portfolio’s total valuation stands in excess of €23bn, with 8 investments made this year. In the US, we invested in HR analytics and networking solution Knoetic, while in Europe, we invested in consumer electronics company Nothing, food delivery platform Voilà, and task and project management tool Superlist. Instabox and Budbee announced they would join forces as Instabee at a €1.6B valuation, Sonantic was acquired by Spotify, Riskmethods by Sphera, Peltarion by King, Popcore by Rollic, and Wolt by DoorDash.

We led Superlist’s €10m seed round and co-led Nothing’s €63.4m Series B and Einride’s €200m Series C. Portfolio up rounds included Cleo’s €70m Series C, Let’s Do This’s €60m Series B, and Juni’s €100m Series B.

Portfolio Companies Changing the World

It was a great year for our portfolio, with Candela announcing its first 30-person passenger ferry to service Stockholm in 2023, Formo being named one of Berlin’s hottest start-ups by Wired, Dott joining the world’s largest sustainability initiative, Heart Aerospace signing LOIs for 99 electric airplanes, Supplant being a finalist at Fast Company’s World Changing Ideas Awards, Verkor announcing its intention to build its first battery cell factory, Natural Cycles’s partnership with Oura, Treecard’s €23m Series A to fund its restoration of the world’s forestry, Kive’s AI Canvas launch, Unmind supporting British health workers with free access for 2023, Einride’s team-up with Maersk, Beamery’s unicorn valuation, Standard’s partnership with Chartwells Higher Education, Billhop’s Lloyds partnership, Handshake’s White House collaboration, and Nothing’s Phone (1) and Ear (stick) launches.

Events

We held Founder meet-ups in Stockholm and Berlin, a digital ‘downturn workshop’, the BL_NK Impact Week dinner, the EQT FWD Summit, the Energy dinner for female founders and operators, the Work Reboot dinner co-hosted with Sana Labs, and a Web Summit masterclass on unravelling Founder DNA.

In the Media

Alastair Mitchell spoke on CNBC Squawk Box and at the FT Due Diligence conference, Lars Jörnow spoke to Venture Capital Journal and Dagens Nyheter, Doreen Huber discussed Germany’s tech revolution, her favourite stage of company building and the importance of food with Sifted and Rania Belkahia talked to Korelya Capital Investor Loreley Mac Donald about her journey from entrepreneur to VC.

Team Growth

We had 12 new joins from entrepreneurial and founder backgrounds, as well as Stripe, Breakit, Twitter and Spotify. Spanning Stockholm, Berlin, London, Paris, and San Francisco, we welcomed Josh Brewer, Leila Pirbay, Carl Svantesson, Sofie Grant, Daniel Fraai, Anna Lundqvist, Olivia Lindström, Catherine Sanderson, Polly Barnes, Chloe Paramatti, Becky Iverson and Beth Newman.

Looking Ahead

The horizon is far from rosy. The global economy continues to face diverse and complex challenges, but we remain optimistic; it only makes it more important for us to back the founders building the future.

Despite a dearth of IPOs, waves of layoffs and the downward trend of European venture funding this year, investors are sitting on record amounts of dry powder — $84bn across European venture and growth funds, up almost 3x in the last five years — is waiting to be deployed.

And in adversity lies opportunity: a chance to find and invest in those teams adapting fastest to the current landscape. A chance to focus on technology that solves meaningful problems, paving the way for a more sustainable, resilient and high-growth European ecosystem that can weather the storm and come out stronger. A chance to help build what is about to come.

Read more

EQT Ventures III: New Frontiers
State of European Tech
European Venture Funding Drops 44% as Early Stage Weakens
State of European Tech 2021
Russia and Ukraine conflict: Economic implications — KPMG Global
Ukraine economy to shrink by almost 32% in 2022 — central bank | Reuters
Stockholm — why Sweden’s capital is Europe’s new home of impact
More than one quarter of all venture capital funding is going to climate technology, with increased focus on technologies that have the most potential to cut emissions
The Climate Economy Is About to Explode — The Atlantic
Sweden Becomes Electric Car Battery and Green Tech Hub, a New Silicon Valley Emerges at The Arctic Circle
Impact of sanctions on the Russian economy — Consilium
Russia-Ukraine war inflation impact | Deloitte Insights
COP27 take note: Climate tech funding has soared in 2022 — Verdict