In the startup world, it is not unusual for talent from successful corporations to start their very own ventures. This is very true in fintech in Europe, where graduates of unicorns like Monzo, N26, Revolut and others have founded a flurry of recent corporations.
Andrena’s ventures, an independent GP fund (solo general partner) based in the UK, wants to support the snowball effect of the startup factory by investing in one of these second-generation startups at the pre-seed and seed stages. To this end, it is raising $12 million from donors, including several enterprise capital funds and entrepreneurs. The first closure has occurred, with the final closure scheduled for later this yr.
The company’s general partner, Gideon Valkin, told TechCrunch that while it will fund talent rooted in European and British fintech, Andrena itself is sector agnostic. He expects most of his portfolio corporations to focus on other categories reminiscent of artificial intelligence, climate technologies and B2B enterprise solutions.
Andrena has already made its first investment: Nustom, an artificial intelligence startup founded by Monzo co-founder Jonas Templestein, to whom Valkin reported while working at Monzo. Nustom hasn’t launched publicly yet (which explains its concise website), but it already boasts a long list of investors, including OpenAI, Balaji Srinivasan, Garry Tan, Naval Ravikant, and others.
Andrena’s participation in Nustom’s marquee round reflects the company’s thesis and strategy: in most cases, she will contribute between $100,000 and $400,000 to rounds that will be led by others. But Valkin hopes his network will make it easier for founders to raise Series A rounds, potentially from his limited partners or other investors he’s connected to.
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By leveraging its network and writing relatively small checks, Valkin hopes to gain access to attractive deals that larger funds may be unable or unwilling to participate in.
Having a small fund means that small investments have the potential to return all of the capital invested; for a larger company, such investments would not move the needle or be value the risk. Valkin knows this side of the equation: After leaving Monzo, he became an angel investor himself and began working as a seed investor at VC firm Entrée Capital, which is now one of Andrena’s limited partners.
However, managing a single-person fund is not without its challenges, and not only because management fees are proportionately lower. As my colleague Rebecca Szkutak noted last yr, “emerging managers have been on the same roller coaster as startups for several years.”
Valkin says he took a significant pay cut, but sees it as an advantage: Founders can see him as a trusted partner with equally high stakes. “I think it brings us together really well,” he said. His value proposition is to open his network to founders and help them win a Serie A round, while relying on his operational expertise.
This mix is more common in the US than in Europe, where many local VCs have never began a company. However, all the pieces is changing and investing through business angels is becoming more and more common among European entrepreneurs, especially in the fintech industry.
One of Andrena’s LPs, Taavet+Sten, is an investment vehicle run by Wise co-founder Taavet Hinrikus and Teleport co-founder Sten Tamkivi. Both are former Skype employees and have now formally established an early-stage enterprise capital fund, Pluralwith two other partners.
The fact that the couple decided to support Valkin can be seen as a signal supporting his thesis. With swarms of early fintech employees looking for the next challenge, the name Valkin selected for his enterprise is apt: Andrena is a sort of bee, and “pollination, in my opinion, is probably the best analogy for what I do,” he says. he said.