Marathon Venture Partners, a enterprise agency in Athens that prides itself on being “day one companions to Greek tech companions,” simply closed its latest fund with €75 million in capital commitments, in response to companion Panos Papadopoulos.
The car brings the agency’s complete property below administration to €175 million — a significant quantity for an eight-year-old, seed-stage investor in Greece and a mirrored image, too, of some sizable exits. Amongst them was the sale final 12 months of Marathon’s portfolio firm Augmenta to CNH, a maker of farm equipment and building tools in a cash deal that valued Augmenta at $110 million. Marathon additionally offered a few of its shares in Hack the Field, a cybersecurity upskilling and expertise evaluation platform, to the funding agency Carlyle in a secondary transaction.
We chatted with Papadopoulos forward of an in-person sit-down with him as a part of TechCrunch’s first StrictlyVC night in Athens on Thursday, Might 8, an evening that can even embody a deep dive with Greece’s prime minister, Kyriakos Mitsotakis. What we needed to know — and what the central questions shall be Thursday evening — is: why Greece, and why now?
Greece has traditionally seen much less enterprise funding than different European international locations. What, if something, has modified domestically that enabled you to boost a €75 million fund when international fundraising has turn into tougher?
For starters, Marathon I is a high percentile performer globally in [realized returns]; we constructed a portfolio that captured the present zeitgeist properly earlier than, for instance, AI-assisted scientific analysis, robotics or protection turned the norm.
What’s your agency’s thesis and the way does this latest fund’s thesis differ given the prolonged timeline we’re seeing for exits globally?
We’re backing founders who do one thing exhausting in essential markets. It may be exhausting as a result of it requires distinctive information, like a analysis PhD, or excessive company, that means understanding of a regulated or neglected business like energy grid administration. And we’re going to proceed doubling down on our fast-growing group, which has been accumulating expertise and experience, together with ambition.
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Greek startups have historically confronted challenges scaling past the home market. How are you evaluating an organization’s worldwide development potential on this atmosphere the place capital effectivity issues greater than fast enlargement?
I urge to vary. Greek startups leverage native expertise to serve main international clients and markets from day one. Throughout our portfolio there’s nearly no income coming from the home market. However they’re serving one of the best a part of Fortune 500.
On the similar time, capital effectivity and group grit are second nature to our group.
We’re seeing fewer IPOs globally and prolonged holding durations for venture-backed firms. How did this have an effect on your conversations together with your restricted companions about anticipated timelines and returns?
We don’t want decacorns for our fund economics to work. We make investments early on, keep substantial fairness positions, and maintain our fund sizes small. These present for varied alternatives for significant returns, together with secondaries and strategic M&A, properly earlier than an IPO. We did secondaries again in 2021 when a lot of the market was promising infinite holding instances. In our tradition, money is king. Evidently many others forgot it.
Many European VCs are emphasizing deep tech and AI. Is Marathon taking an analogous strategy, or do you see totally different alternatives particular to the Greek ecosystem?
After all all of us are, however the definition of deep tech is stretched and means many alternative issues to totally different individuals. We aren’t specializing in any particular sector per se – as a substitute, we’re specializing in individuals altering their sectors. We have been maybe the primary generalist VC to put money into protection earlier than the Ukraine battle.
Greek founders have traditionally acquired much less funding than counterparts in Berlin, Paris, or Stockholm. Are you seeing valuations for Greek startups that replicate this low cost, and does this create alternatives for higher returns?
In our expertise, this isn’t about geography or value. We’re backing founders in non-consensus alternatives that the majority VCs would ignore. We transfer quick with conviction and we don’t ask who else is investing. These would possibly sound like desk stakes; they nonetheless aren’t.
Given the difficult international exit atmosphere, how are you advising your portfolio firms about strategic options like secondary gross sales or acqui-hires?
We work with our portfolio firms towards default alive situations. Ranging from there, all choices are on the desk. We see founders actually wish to run their firms for the long run. We consider a secondary sale can really assist in the direction of that, and most frequently we’re supportive of such situations.
The EU has emphasised supporting startups by varied funding mechanisms. How essential is non-dilutive capital from these sources to your portfolio firms in comparison with 5 years in the past?
We welcome any such initiative. We advise, nonetheless, our portfolio founders to not waste time on non-market associated actions.
How has Greece’s improved macroeconomic state of affairs affected each your fundraising course of and the standard of startups you’re seeing?
It’s at all times good if you end up not making the press headlines, however what we do is much less related to native macro. Relating to the expertise entrance, I’d say actually primarily based on naive empiricism that, if there’s any correlation, that’s inverse. Adversity is the mom of all invention.
Many American VCs have pulled again from European investments. Has this created extra alternatives for native funds like Marathon, or has it made syndicating offers tougher?
It’s undoubtedly a distinct market but additionally creates elevated alternative for European buyers. I don’t suppose the flood of capital in 2021 actually modified the chance for European firms. We should at all times rely on ourselves and be aligned with founders for the long run.