Venture capital firm Octopus Ventures is entering the world of pre-seed investment with a £10m fund to back early-stage startups across Europe.
The highly active London-headquartered VC has built a dedicated pre-seed team led by former senior staff at Seedcamp and Uber. It is looking to invest in B2B software, fintech and health startups.
Octopus Ventures’ all-female pre-seed team has already made its first wave of investments into 10 businesses across the UK, Germany and Spain.
Of those, 40% of have a female founder and 30% at least one ethnic minority founder.
“All have revolutionary ideas. We know we can increase the diversity of where we invest further, and we want to hear from female and under-represented founders with the next $1bn idea,” said Maria Rotilu, who is co-leading the fund and has previous experience as Uber Niger country manager and investor for Hustle Fund.
More than half of the fund’s first investments are based in the UK. They include fertility treatment startup Bea Fertility, fintech Bloom Money, charity platform Volunteero, developer startup Baselime and female-assigned teens app Luna.
The new pre-seed fund is looking to address what Octopus Ventures co-CEO Alliott Cole describes as a “missed opportunity” and “a long-term challenge for European businesses”.
Cole added: “By establishing a team devoted to earliest stage businesses, with a devoted fund and two of Europe’s best pre-seed investors leading it, we’re seizing that opportunity to back the businesses that will change the world, from day one.”
It comes as earlier stage investment has declined despite overall European and UK investments soaring to record levels last year.
“We built the pre-seed team to move fast while providing every benefit of a major venture capital partner,” said Kirsten Connell, who is co-leading the new Octopus Ventures fund and has previous experience as the general manager of Seedcamp.
“In our first wave of investments, we’ve moved from first meet to termsheet in two weeks and, as part of the portfolio, our founders are benefiting from access not just to sector experts from Octopus, but a network of more than 400 leaders who have walked in their shoes and are ready to help guide and advise new founders on the trials of building a business.”
Octopus Ventures, part of Octopus Group, is one of the most active VCs in Europe. Accoring to Dealroom data, it has made most of its investments at the Series A stage. The lion’s share – 195 – of its investments have been in UK startups, while 25 have been in US firms.
Its notable investments include Cazoo, Zoopla and Depop, all of which have either gone public or been acquired.