Dutch Velocity Capital Launches $120 Million Fintech Fund

(Bloomberg) -- Dutch private equity firm Velocity Capital has launched a 105 million euro ($120 million) venture fund aimed at investing in early stage companies focusing on banking, payments, credit and other fintech areas.

The Amsterdam-based private equity firm, which has invested in fintech companies since 2007 including online brokerage firm TradeKing Group Inc. and South African point-of-sale provider Yoco, said on Tuesday it’s launching its first fund in order to create more investment possibilities as the size of its early stage investments increases.

Unlike most venture funds, Velocity’s evergreen fund won’t have a fixed-end period and the firm will recycle any capital from exits back into the fund, the firm said. Velocity said the structure provides more flexibility to focus on optimizing a company’s value compared to a closed-end fund, which can force the fund’s agenda on entrepreneurs.

"While we seek fast growth where possible, we also recognize the realities of business and have structured our fund differently to have the capacity to be patient," said Willem Willemstein, general partner & founder of Velocity Capital. “We care more about preparing and supporting our founders to run big companies than about a ticking clock."

Velocity’s existing portfolio of a dozen companies, primarily in Europe and Africa, will be transferred into the new FinTech Venture Fund, whose other investors also include two private Dutch families, and several Dutch entrepreneurs, the firm said.

The firm has already invested in two companies through the fund. It announced Monday that it has invested 3 million euros ($3.4 million) in a Series A funding round in Amsterdam-based Owlin, a news analytics tool. In May, the firm took part in a Series B funding round for Prague-based Twisto, a credit and payment solutions provider, in which Velocity invested 4 million euros.

To contact the reporter on this story: Natalia Drozdiak in Brussels at ndrozdiak1@bloomberg.net

To contact the editor responsible for this story: Giles Turner at gturner35@bloomberg.net

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