Practica Capital in its commitment to ensuring capital availability for the Baltic founders is poised to double down on its effort having closed its third vintage and largest fund to date at an €80 million hard cap. The subject firm – Practica Venture Capital III is a 3x uptick in size from its predecessor. However, the fund is known to be the biggest seed fund in the region to date and establishes the subject firm as a pan-Baltic early-stage investor.
‘Arvydas Blozë’, Partner at Practica Capital said: “The majority of capital deployed at early-stage in Europe is domestic. We saw the clear funding gap in a maturing Baltic ecosystem. We are pleased to facilitate the interest of Baltic pension fund managers alongside the continuous support by EIF, EBRD, and INVEGA. Venture capital in the Baltic is finally emerging as an asset class and it is a game changer”.
The final closing of the subject investment was completed with the European Investment Fund (EIF) joining as a cornerstone investor. The European Bank for Reconstruction and Development (EBRD), SEB Investiciju Valdymas, and Investiciju ir Verslo Garantijos (INVEGA) joined Swedbank Investiciju Valdymas and Swedbank Investeerimisfondid as anchor investors. It’s worth noting that Institutional capital comprised more than 80% and returning capital more than 70% of the commitments. The investment witnessed the support from several individual LPs, like the co-founders of Nord Security, and Lithuanian unicorns Vinted, coupled with other successful tech companies, and several startups previously backed by Practica VC.
EIF Chief Executive ‘Marjut Falkstedt’, commented: “After the EIF supported the 2012 vintage fund, which pioneered venture capital in Lithuania, this new fund is set to become one of the largest early-stage funds ever launched in the Baltics. With highly skilled fund managers at the helm, we firmly believe that the launch of Practica Venture Capital III, backed by the InvestEU programme and the Baltic Innovation Fund 2, will play a pivotal role in both fortifying the region’s emerging venture capital ecosystem and also ensuring a steady flow of seed funding for ambitious local entrepreneurs, a crucial factor considering the challenging economic landscape ahead”.
It’s also worth noting that seed to Series A graduation cohort approaching 40%, 0.7x DPI achieved in 2023, top quartile performance for Europe at Practica Venture Capital II, as a result of robustness and resilience of Baltic tech ecosystem contributed to the investor appetite surpassing the hard cap of the fund even during the period of market recalibration and tough fundraising environment.
As part of Practica Capital’s commitment, the VC aims to continue its role as lead investor and support the break-out attempts of the early-stage tech startups in the subject region, notably Lithuania, Estonia, and Latvia. Given this, the strategy is tailored for the seed stage and is equipped to deploy up to €3 million in initial tickets and support winning companies up to €8 million over the lifetime of the fund. The fund has deployed over €10 million and backed 6 companies, such as Heavy Finance, Amlyze, Sentante, and Breezit. However, 3 companies are reportedly in the term sheet stage.
‘Donatas Keras’, founding partner at Practica Capital added: “We are a local lead investor serving and evolving with the ecosystem and acting from within. With recent team expansion, we now have secured a presence in Latvia and Estonia, and we are excited to finally fulfill our promise for the ecosystem in the Baltics”.
Practica VC is determined to focus mainly on technology investments, with a solid track record in SaaS, Marketplaces, and Deep/Industrial tech. Currently, Practica Capital has an AUM of over €130 million and has invested in more than 60 companies in total, including emerging category leaders like TransferGo, PV case, and Interactio.
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