As we noted in our most recent LP report, we could easily have started this piece by commenting on the difficulties seen in 2022 - war, inflation, rising interest rates, the looming threat of recession, and institutional instability across many regions and sectors.
However, while we are acutely aware that macro conditions have worsened in 2022 compared to 2021, we have been through cycles like this before, and we remain optimistic. We prefer instead to note the many excellent things that 2022 gave us - a year of team growth, portfolio growth and quality deal flow - before outlining a number of the reasons we’re looking ahead with excitement to an active 2023 across our offices in Europe and Latin America.
Briefly, an overview of the things that made us proud in 2022:
Firstly, we fully expect many of our strongest performers to double down on their winnings from last year. Exoticca continues to experience impressive growth (and create excellent TV spots as they go), while Factorial’s unstoppable rise continues (and continues to be recognised publicly). BDEO and Urbanitae are also showing highly promising developments in the insurance and property investment spaces respectively, supported by a long-tail of smaller (but no less brilliant) investments such as IF Lastmile, Boopos and Barkibu.
To add to these winners, we’re excited about the pipeline we have to finish off our second early-stage fund, KII. This vehicle exists to back the best early-stage founders in Southern Europe, with tickets from €100k to €3.5m, and we continue to observe an increasing quality and quantity of brilliant Southern European founders across our target markets. And while big tech layoffs are a negative overall, we are confident that we’ll see yet more top-tier founders born out of this period.
More broadly, we see 2023 as a very exciting year for Spanish tech. The Digital Nomad Visa and recent Start-up Law have made it the best time ever to move to, and invest in, the region. Madrid particularly is excelling as a place to live and work, and while 2022 funding across Spain dropped slightly compared to 2021, it was still the second highest year on record. Spain now boasts +15k start-ups and +400 scale-ups, with a rapidly maturing venture ecosystem to support this growth.
This said, we still face many local challenges in fundraising, especially at later stages. While we are proud that Leadwind is the region’s first growth fund, we need to see more in the market in the way of local co-investors - to keep talent in Spain, and ensure the returns from these successes stay in the ecosystem. This must be driven by more large corporations investing in growth funds, alongside traditional institutional investors such as pension funds and insurers.
We also see 2023 as a year where we continue to build specialisms across our funds. The team already possesses an enviable variety of experience across corporate, big tech, venture builders, start-ups and venture capital - and we have developed specific theses as a fund and individuals over recent years. We like businesses building software to improve productivity and performance within traditionally analogue roles (Factorial, Abacum, Bloobirds, Graphext), alongside the digitalisation of SMBs (Fuell), operations management (IF, Kosmo), fintech & insurtech (Boopos, Barkibu), lifestyle (Exoticca) and devtools/productivity tools (Arengu, Trackingplan, tl;dv). And this year we look forward to diving further into specific verticals - such as a recent deep dive into quantum computing, our just published work on climate tech, or our planned explorations into healthtech and foodtech in the coming months.
To focus on talent, our team continues to grow, and we cherish the perspectives (and cultural challenges!) added with a team that now includes Portuguese, English and Brazilians on top of our Spanish roots. In 2022 we added nine new faces and two new offices, and already in 2023 we’ve brought in Josep and Silvia to strengthen the teams in Barcelona and Madrid respectively. We will likely continue to develop our team in Spain and beyond as we look to raise more funds and promote Southern Europe on the international stage.
We are also looking at 2023 as a year where we double down on K Fund’s corporate connections, and support our rapidly growing portfolio with connections to potential clients in our network. We are working with our portfolio to unlock this network and our individual connections, as we see a tough year coming for many start-ups in Europe and Latin America, where key customer introductions can play a vital role in growth.
And lastly, 2023 is the year we formalise ESG activities at K Fund. We are proud and long-standing partners of Nikita and the brilliant team at IncludedVC, and love their work to improve diversity and inclusion in the venture capital industry. This year, we will build on this with our first portfolio ESG report, re-focus on internal policies as a team, make amendments to our deal flow approach, and bring in external counsel to support our portfolio in their move towards greener, fairer and more transparent operations.
We are hugely thankful to everyone who has supported us to date, and incredibly proud of all our portfolio founders for even attempting the herculean task that is building a start-up. We are confident 2023 will be a year in which we continue on our path to become the reference point in Southern Europe for the best entrepreneurs, across multiple stages and asset classes.
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Have an idea you want to share with us? Let us know
As we noted in our most recent LP report, we could easily have started this piece by commenting on the difficulties seen in 2022 - war, inflation, rising interest rates, the looming threat of recession, and institutional instability across many regions and sectors.
However, while we are acutely aware that macro conditions have worsened in 2022 compared to 2021, we have been through cycles like this before, and we remain optimistic. We prefer instead to note the many excellent things that 2022 gave us - a year of team growth, portfolio growth and quality deal flow - before outlining a number of the reasons we’re looking ahead with excitement to an active 2023 across our offices in Europe and Latin America.
Briefly, an overview of the things that made us proud in 2022:
Firstly, we fully expect many of our strongest performers to double down on their winnings from last year. Exoticca continues to experience impressive growth (and create excellent TV spots as they go), while Factorial’s unstoppable rise continues (and continues to be recognised publicly). BDEO and Urbanitae are also showing highly promising developments in the insurance and property investment spaces respectively, supported by a long-tail of smaller (but no less brilliant) investments such as IF Lastmile, Boopos and Barkibu.
To add to these winners, we’re excited about the pipeline we have to finish off our second early-stage fund, KII. This vehicle exists to back the best early-stage founders in Southern Europe, with tickets from €100k to €3.5m, and we continue to observe an increasing quality and quantity of brilliant Southern European founders across our target markets. And while big tech layoffs are a negative overall, we are confident that we’ll see yet more top-tier founders born out of this period.
More broadly, we see 2023 as a very exciting year for Spanish tech. The Digital Nomad Visa and recent Start-up Law have made it the best time ever to move to, and invest in, the region. Madrid particularly is excelling as a place to live and work, and while 2022 funding across Spain dropped slightly compared to 2021, it was still the second highest year on record. Spain now boasts +15k start-ups and +400 scale-ups, with a rapidly maturing venture ecosystem to support this growth.
This said, we still face many local challenges in fundraising, especially at later stages. While we are proud that Leadwind is the region’s first growth fund, we need to see more in the market in the way of local co-investors - to keep talent in Spain, and ensure the returns from these successes stay in the ecosystem. This must be driven by more large corporations investing in growth funds, alongside traditional institutional investors such as pension funds and insurers.
We also see 2023 as a year where we continue to build specialisms across our funds. The team already possesses an enviable variety of experience across corporate, big tech, venture builders, start-ups and venture capital - and we have developed specific theses as a fund and individuals over recent years. We like businesses building software to improve productivity and performance within traditionally analogue roles (Factorial, Abacum, Bloobirds, Graphext), alongside the digitalisation of SMBs (Fuell), operations management (IF, Kosmo), fintech & insurtech (Boopos, Barkibu), lifestyle (Exoticca) and devtools/productivity tools (Arengu, Trackingplan, tl;dv). And this year we look forward to diving further into specific verticals - such as a recent deep dive into quantum computing, our just published work on climate tech, or our planned explorations into healthtech and foodtech in the coming months.
To focus on talent, our team continues to grow, and we cherish the perspectives (and cultural challenges!) added with a team that now includes Portuguese, English and Brazilians on top of our Spanish roots. In 2022 we added nine new faces and two new offices, and already in 2023 we’ve brought in Josep and Silvia to strengthen the teams in Barcelona and Madrid respectively. We will likely continue to develop our team in Spain and beyond as we look to raise more funds and promote Southern Europe on the international stage.
We are also looking at 2023 as a year where we double down on K Fund’s corporate connections, and support our rapidly growing portfolio with connections to potential clients in our network. We are working with our portfolio to unlock this network and our individual connections, as we see a tough year coming for many start-ups in Europe and Latin America, where key customer introductions can play a vital role in growth.
And lastly, 2023 is the year we formalise ESG activities at K Fund. We are proud and long-standing partners of Nikita and the brilliant team at IncludedVC, and love their work to improve diversity and inclusion in the venture capital industry. This year, we will build on this with our first portfolio ESG report, re-focus on internal policies as a team, make amendments to our deal flow approach, and bring in external counsel to support our portfolio in their move towards greener, fairer and more transparent operations.
We are hugely thankful to everyone who has supported us to date, and incredibly proud of all our portfolio founders for even attempting the herculean task that is building a start-up. We are confident 2023 will be a year in which we continue on our path to become the reference point in Southern Europe for the best entrepreneurs, across multiple stages and asset classes.
–
Have an idea you want to share with us? Let us know
