Lakestar Is Said to Be Raising Largest-Ever European VC Fund

(Bloomberg) -- Venture capital firm Lakestar is attempting to raise the largest-ever European fund for startup investments -- another sign that the region’s entrepreneurs are continuing to attract floods of potential suitors.

Lakestar is targeting a close of around $800 million, according to three people with knowledge of the plans, asking not to be named because the matter was private. There was no certainty on the final amount and discussions with investors are still ongoing, one of the people said.

Last year Atomico, run by Skype co-founder Niklas Zennstrom, created the largest European VC fund at $765 million.

A spokesman for Lakestar declined to comment.

Klaus Hommels, one of Europe’s best-known tech investors and an early backer of Spotify Technology SA, Facebook Inc. and Skype, founded Lakestar in 2013. The company now has offices in Switzerland and London, with recent investments including razor-maker Harry’s and financial startup Revolut. Lakestar’s new fund would be the first since its 350 million-euro ($412 million) raise in 2015.

This year has seen several other large funds being announced, including one of $541 million by Highland Europe to invest in "growth-stage" European technology companies, and another of $375 million from London-based Eight Roads Ventures, the proprietary investment arm of Fidelity International Ltd.

Lakestar’s new investment vehicle will be split into two pools, one focusing on young startups, the other targeting growth-stage companies, according to two people familiar with the plans.

The influx in capital comes as a number of European tech companies have achieved sizeable exits. Spotify, the Stockholm-based music streaming company, became Europe’s second-most-valuable technology company when it achieved a $30 billion valuation with its listing on the New York Stock Exchange in April. Dutch payments processor Adyen BV ended up raising about 947 million euros in its June debut in Amsterdam.

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