Global Founders Capital, the Berlin-based early stage VC firm with ties to Rocket Internet, is making a strategic shift to become the venture arm of Rocket Internet. The firm, which previously raised two $1 billion funds and was involved in numerous deals per year, will now exclusively invest from Rocket Internet’s balance sheet.
In a recent interview with TechCrunch, Global Founders Capital Partner David Sainteff explained the reasons behind the shift. He mentioned changes in the fund’s structure and team composition, leading to the decision not to raise another fund at this time. Sainteff emphasized that they have €300 million from Rocket Internet to deploy for venture investments and do not currently have any fundraising plans.
The new strategy will focus on early stage investments and follow-on investments in later rounds, with only five partners remaining in the firm. The decision not to raise a third fund may have been influenced by a lack of support from potential limited partners and the current tech downturn compared to previous years.
Despite the shift, Global Founders Capital has seen success with its previous investments, with the first fund expected to generate returns between 3x and 4x. The firm’s decision to use Rocket Internet’s capital reflects confidence in their ability to remain competitive in the market.
While the pivot may signal a reversal of the firm’s earlier expansion, Sainteff remains open to the possibility of raising a fund in the future when conditions are favorable. For now, Global Founders Capital’s new direction marks a significant change in its investment strategy and signals a shift towards a more focused approach in the venture capital landscape.