Tuesday, 22 September 2015

Notion Capital Launches New $120m Fund to Continue Investment in Europe’s Best B2B SaaS Companies

Notion Capital has completed the first close of its third fund at $120m, focussed on European Cloud Computing and Software-as-a-Service (SaaS) companies at Series A stage. The final close is expected later this year with a target of $150m, taking the total funds under management at the firm to in excess of $300m. As such Notion Capital represents by far the largest dedicated B2B SaaS fund in Europe.

In two previous funds, the firm has invested in 33 companies, including some of the most exciting and fastest growing in Europe. That includes breakout success stories like NewVoiceMedia and Tradeshift, who have together raised over $200m from leading international growth investors. It also includes major European exits such as Shutl, to Ebay and Star, to Claranet.

At the same time, its portfolio includes many of Europe’s most exciting and high potential SaaS companies, including Adbrain, Brightpearl, Currency Cloud, Duedil, IOCS and MOVE Guides.

These companies come to Notion Capital for its laser focus and experience. The partners are best known for founding and building MessageLabs, which became the biggest EU SaaS exit in Europe at its $700m sale to Symantec but the team had previously taken a similar journey with two previous businesses. On top of that, working closely with all of its portfolio companies, it has developed a collective experience and ecosystem that simply can’t be found elsewhere.

Recognised as an “Equity Gap Fund of the Year” winner in GP Bullhound’s Investor AllStars awards, the firm has won widespread recognition for offering portfolio companies as much value through their help and guidance as through funding itself.

The new fund is backed by existing and new investors at multiple institutions as well as family offices and high net worth individuals, including several world-renowned technology entrepreneurs. It also continues to be supported by the European Investment Fund and British Business Bank, extending their on-going partnership with Notion in helping entrepreneurs in Europe build global, category leading, SaaS businesses.
Cloud / SaaS Market Size

Global Public Cloud Market Size: c.$150bn, 17% CAGR (Gartner)
European Public Cloud Market Size: c.$37bn, 17% CAGR (Gartner)
SaaS is $23bn in 2013 out of $134bn spent on Enterprise Applications. c. 17% (IDC)

Demand for SaaS enterprise applications is accelerating and exceeding the demand for on-premise applications by five times; SaaS forecast growth 17.6% CAGR, on-premise 3.1%. Saas predicted to be $51bn by 2018 (IDC)

Stephen Chandler, Managing Partner at Notion Capital comments on the news:

“Our strategy remains to only invest in what we know and we think this gives us a strong advantage in the market for both evaluating and supporting companies. We aim to identify emerging entrepreneurial talent in Europe and help them build global category leaders. There are tremendous opportunities in this part of the world and the market remains undersupplied with high quality capital. This new fund helps us change that.”

As the portfolio continues to grow, so does the team and its experience. Chrys Chrysanthou, already an executive-in-residence at the firm, moves to a full time role for Fund III as a Principal in the investment team. Chrys brings with him a wealth of experience from Cisco, Amazon Web Services and Accel Partners, across USA, EMEA and Asia, with roles including M&A, venture investing, angel investing, mentoring, ecosystem development and startup operating roles.

Adam Shepherd and Dan O’Toole have also joined as Associates with expertise and experience in their respective fields.