BlackFin Capital Partners announced a €350 million investment fund. The money is intended for European fintech companies.
BlackFin is a private equity firm. Private equity firms raise money from organizations and invest in businesses with high potential. BlackFin manages a total of €2.4 billion. This makes BlackFin one of the largest private investment companies in Europe.
BlackFin recently raised €350 million in a fund for European fintech companies. The money is intended for fast growers in B2B markets. BlackFin previously invested in Friss, a Dutch developer of fraud prevention software. In 2017, BlackFin acquired Buckaroo, which was later sold to Keensight Capital.
The role of private equity
Companies rarely grow without funding. Scaling up a technology business is especially expensive. Often, startups and scaleups have to look abroad to continue growing. The market of a single country is simply too small. The salaries of new sales employees and developers quickly rack up.
Investments are a solution, but it can be extremely difficult to get on a call with the decision-makers of large funds. That’s why most European member states have a government agency for entrepreneurs. The agencies receive public funds to distribute among companies.
Although private equity firms have a similar role, the money’s source differs. A company like BlackFin doesn’t talk to governments, but to organizations. Small and large companies invest in BlackFin, after which BlackFin distributes the money among promising companies. The idea is that they will continue to grow and make a profit for the initial investors.
BlackFin is very picky. Should BlackFin invest in companies that fail to return, investors lose confidence in the fund. Without trust, BlackFin isn’t worth much. As a result, it’s difficult to get a foot in the door. Only the most promising companies are considered for the new fund.