Felix Capital closes $300M fund to double down on DTC, break into fintech and make late-stage offers

To kick off 2020, certainly one of Europe’s newer — and extra profitable — funding corporations has closed a recent, oversubscribed fund, one signal that VC within the area will proceed to run robust within the yr forward after startups throughout Europe raised between $35 billion and $36 billion in 2019.

Felix Capital, the London VC based by Frederic Court docket that was one of many earlier corporations to determine and spend money on the development of direct-to-consumer companies, has raised $300 million, cash that it plans to make use of to proceed investing in artistic and shopper startups and platform performs in addition to start to faucet into a more recent space, fintech — particularly startups which might be centered on shopper finance. 

Felix thus far has centered totally on earlier-stage investments — it now has $600 million beneath administration and 32 corporations in its portfolio in eight nations — based mostly throughout each Europe and the US. Court docket mentioned in an interview {that a} portion of this fund will now additionally go into later, development rounds, each for corporations that Felix has been backing for a while in addition to newer faces.

As with the main focus of the investments, the make-up of the fund itself has a robust European present: the vast majority of the LPs are European, Court docket famous. Though Asia is one thing it want to sort out extra sooner or later each as a marketplace for its present portfolio and as an funding alternative, he added, the agency has but to speculate into the area or considerably increase cash from it.

Felix made its debut in 2015, based by Court docket after a robust run at Creation Capital the place he was concerned in quite a lot of huge exits. Whereas Court docket had been a robust participant in enterprise software program, Felix was a step-change for him into extra of a major deal with shopper startups centered on trend, way of life and artistic pursuits.

That has over time included investing in corporations just like the breakout high-fashion market Farfetch (which he began to again when nonetheless at Creation and is now public), Gwyneth Paltrow’s GOOP, the jewelry startup Mejuri, trend-watching HighSnobiety, and health startup Peloton (which has additionally IPO’d).

It’s not an altogether easygoing, vanilla record of cool stuff. Peloton and GOOP have had been mightily doused in snarky and sharky sentiments; and typically it even appears as if the manufacturers themselves personal and domesticate that picture. Because the saying goes, there’s no such factor as dangerous press, I suppose.

Though it wasn’t one thing particularly articulated in startup land on the time of Felix’s launch, what the agency was honing in on was a rising class of direct-to-consumer startups, primarily all within the space of e-commerce and constructing manufacturers and companies that have been bypassing conventional retailers and retail channels to develop major relationships with customers via newer digital channels resembling social media, messaging and electronic mail (alongside their very own DTC web sites). 

This isn’t Felix’s sole focus, with investments into a variety of platform companies like company journey website TravelPerk, Amazon -backed meals supply juggernaut Deliveroo and Moonbug (a platform for youngsters’s leisure content material); and more and more later stage rounds (for instance it was a part of a $104 million spherical at TravelPerk; a $70 million spherical for marketplace-building service Mirakl; and $23 million for Mejuri.

Court docket’s observe file previous to Felix, and the success of the present agency up to now, are two probably explanation why this newest fund was oversubscribed, and why Court docket says it needs to additional unfold its wings right into a wider vary of areas and funding phases.

The curiosity in shopper finance just isn’t such a big step away from these areas, when you think about that they’re simply the opposite aspect of the coin from e-commerce: saving cash versus spending cash.

“We see this as our prism of alternative,” mentioned Court docket. “Simply as we had the instinct that there was an area for traders taking a look at [DTC]… we now assume there’s sufficient proof that there’s demand from customers for brand spanking new methods of coping with cash and private finance.”

The agency has from the beginning operated with a board of advisors who additionally make investments cash via Felix whereas additionally holding down day jobs.

They embody the likes of executives from eBay, Fb, and extra. David Marcus –who Court docket backed when he constructed funds firm Zong and ultimately bought it to eBay earlier than he went on to turn into a serious mover and shaker at Fb and is now has the presumably Sisyphean process of constructing Calibra — is on the record, however that has not translated into Felix dabbling in cryptocurrency.

“We’re watching cryptocurrency, however should you take a Felix stance on the realm, it’s solely had one wonderful model to date, bitcoin,” mentioned Court docket. “The remainder, for a shopper, may be very obscure and entry. It’s nonetheless actually early, however I’ve received little question that there might be some issues rising, significantly across the concept of ‘invisible cash.’”

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