Venture Capital/News/ Berlin-based Visionaries Club raises €400m to invest in European B2B tech The B2B market is slowing down — so where will Visionaries Club place its bets? By Miriam Partington in Berlin 22 September 2022 \Venture Capital Hoxton Ventures to add a new partner in April By Amy Lewin 17 February 2023 Venture Capital/News/ Berlin-based Visionaries Club raises €400m to invest in European B2B tech The B2B market is slowing down — so where will Visionaries Club place its bets? By Miriam Partington in Berlin 22 September 2022 Visionaries Club, a VC firm based in Berlin, has raised a fresh €400m fund to invest in B2B tech. This will be divided into three separate funds: a €150m seed fund; a €200m early growth fund to invest in startups post-Series B; and a new so-called Tomorrow Fund of €50m, which will focus on science and technology investments at pre-seed and seed. Where will Visionaries Club’s money be spent? Visionaries Club, which was launched by partners Robert Lacher and Sebastian Pollok in 2019, focuses on two main areas: the digitisation of the enterprise supply chain, which is everything from sourcing to sales (think process mining unicorns such as UiPath and Celonis and digital freight forwarder Sennder), and tools that enable employees to work remotely. Lacher says he’s also excited by B2B fintech: things like buy now, pay later which was “very in vogue” last year, as well as B2B payment stacks since “there’s no PayPal for B2B yet”. Visionaries Club is also looking into SaaS for small businesses — “the most underserved sector when it comes to software, but the biggest market globally overall”, says Lacher. It’s already backed companies like HR tech giant Personio and Taxdoo, which offers automated tax compliance services. The firm will reserve 60% of the seed fund for follow-on investments and just 30% for the growth fund — Visionaries is “not ownership-focused there”, says Lacher. The new Tomorrow Fund has a different focus entirely, seeking to tackle big-world problems such as climate change and pollution. The €50m fund will go towards startups in health, transportation, agriculture, construction and mobility. “There is just not enough ‘courageous capital’ combined with entrepreneurial experience being deployed in these areas. We are happy to have our share in making both more accessible from now on,” says Pollok. The strategy, he explains, is to “go in super early at pre-seed or seed stage”, investing between €500k and 3m, to help companies bring their solutions to market and scale them globally. What’s Visionaries Club’s track record? Visionaries Club closed two $85m funds (one pre-seed and seed; one growth) last May — a strategy it is now repeating on a bigger scale with its new €150m seed fund and €200m early growth fund. Having two microfunds gives Visionaries a certain amount of flexibility, says Lacher. From the seed fund, it can lead and co-lead seed investment deals of €1-5m (average ticket size €2.5m). And with the growth fund, it can co-invest in Series B rounds with large multi-stage VC funds — without having to compete with them. Visionaries Club typically invests €5-10m in growth-stage startups with an average ticket size of €7.5m. In its portfolio are B2B unicorns such as Choco (software for restaurants and suppliers), Personio (HR software) and TrueLayer (open banking infrastructure). Visionaries’ backers include some of Europe’s top founders, like Personio’s Hanno Renner, HelloFresh’s Dominik Richter and UiPath’s Daniel Dines. German family offices working for entrepreneurs such as Felix Fiege, Selina Stihl and the families behind baking goods multinational Dr Oetker and beer company Bitburger have also invested in the funds. How is B2B affected by the downturn? The B2B market has been red hot in recent years. In 2021, funding for European SaaS hit a peak of €41.5bn, according to Dealroom data, and startups in the sector raised 39 $100m+ rounds. Now, valuations for late-stage deals are beginning to slide amid the downturn, with Klarna’s 85% drop in valuation being the most notable example. So is the golden era for B2B SaaS about to end? Lacher has a few thoughts. “We don’t really see the current situation as a crash but as a healthy correction,” he says. “In our view, 2020 to 2021 has been unhealthy, with too much money going into the ecosystem, too many rounds happening too fast and valuations being too aggressive.” Now, B2B tech companies are valued at 10x revenue multiples in the public market — returning to the average level they have been at for the past 15 years. Investors generally are being more careful in deploying large cheques at later stages where they “don’t know if the valuation is justified,” adds Lacher. Series A, B, C and D rounds are “pretty slow right now”, he adds, while seed rounds are becoming increasingly competitive, with Series A funds like Accel, Index, Sequoia, General Catalyst and Lightspeed all competing for the same deals. Visionaries Club is pretty relaxed, says Lacher, under the circumstances. If you look at previous financial crises, B2B companies with strong revenues survive economic dips well, because “they’re not like Gorillas, or Flink, or consumer internet companies” which require a lot of cash to operate. Each of Visionaries Club’s growth portfolio companies has between 30 and 80 months runway, meaning they won’t need to raise fresh funds for the moment, he says. Sifted’s Take Visionaries Club, though a young VC, already has a strong track record of B2B investing, with five of its 32 companies being unicorns, as well as a few companies (including Taxdoo, Yokoy, Pigment and Leapsome) on the way to reaching that $1bn mark. It also has an interesting USP: it’s backed by both family businesses from the old economy and well-known digital entrepreneurs, both of which can bring valuable B2B experience for founders. It will be interesting to see what companies Visionaries Club places its bets on, now that the B2B market is slowing down — as well as how its Tomorrow Fund will fare against sector-focused VCs with arguably more experience in specific areas. Miriam Partington is Sifted’s DACH correspondent. She also covers future of work, coauthors Sifted’s Startup Life newsletter and tweets from @mparts_ Related Articles Friends and family funding screws equality in entrepreneurship By Hattie Willis Click here to read more Stop hunting for unicorns, start looking for green zebras By Johannes Lenhard Click here to read more Felix Capital raises new $600m fund By Kai Nicol-Schwarz Click here to read more Why investors love quantum-as-a-service By Maija Palmer Click here to read more Most Read 1 \Healthtech Is Daniel Ek’s new body scanner worth the hype? Sifted tried it out 2 \Venture Capital VC diversity needs to change — and white men need to take responsibility 3 \Venture Capital New €3.75bn European Investment Fund pot to back late-stage VCs 4 \Sustainability Counteract closes £15m fund for carbon removal solutions 5 \Mobility Was the $5bn that VCs plugged into escooters worth it?