Romanian VC Gapminder Adds Its Own Acceleration Engine

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The Romanian VC Gapminder will soon announce a few sizeable investments. Before that, we spoke to Founding Partner Dan Mihaescu to find out what the local startup scene has to offer and how Gapminder contributes to its development:

How would you describe Gapminder in a few words?

Gapminder is the first Romanian VC with a Seed + Series A focus, adding its own acceleration engine. Thus, we provide an integrated approach for ambitious tech startups in various phases of development.

You were founded by Entrepreneurs for Entrepreneurs. What can you tell us about the people behind Gapminder?

All partners are active investors in the local startup ecosystem, with an interesting mix of experience from deal sourcing and adding value based on a hands-on operational track record to exits and M&A experience. This experience has been built over years from previous top management positions in tech multinationals, active memberships in the local investment and entrepreneurial environment and with a background in national and international acceleration programs.

With your investment strategy, you focus on IT verticals such as SaaS, Machine Learning, AI, or Predictive Marketing, among many others. What is the disruptive potential you see in these areas?

We believe in models that are scaling up fast, are borderless, and have immediate use cases. SaaS projects are generally appealing but what we prioritize are the projects which can be put on steroids by adding a component like Machine Learning, Deep Learning, or projects that provide a new scale of possibilities to their respective clients, such as Predictive Marketing.

Of course, integrating Machine Learning capabilities into FinTech and healthcare companies, or Predictive Analytics into retail businesses are some of the immediately appealing projects. In short, we are looking for deep tech companies in the region and think we are well positioned to help them at an early stage.

You invest up to €1 million in seed funding and an additional €3 million in follow-on rounds. What does it take for a startup to grab your attention?

First of all, they have to fit our target, meaning startups with the potential for global expansion and a focus on IT services and software, cyber security, artificial intelligence, digital transformation, healthcare IT & MedTech, FinTech etc.

We evaluate key elements such as team experience and vision, its energy and how coachable they are, the technology on which the solution is based, the business model, the opportunities and barriers to market entry, the development phase, and the growth potential with emphasis on business potential driven by these technologies as well as market traction.

The highest scores in the evaluations are obtained by startups that prove they already have team-level experience, have earned revenue, have passed the MVP phase, the technology has already been tested by a number of users and, last but not least, they have the ambition of conquering larger markets like Western Europe, Eastern markets, or the US.

What can you tell us about the startups you are currently involved in?

In the next few months, we will announce a few sizeable investments for a seed-focused fund. Recently we’ve already announced that we’ll put more than €1 million in the first batch of 12 to 14 startups selected via our acceleration program, Techcelerator.

How come Techcelerator was established in addition to the fund? In what ways does this partnership support your ambitions?

While our main focus is seed rounds with follow-up investments into Series A, we reserved a small pre-seed bucket with which we are helping to build a more sustainable pipeline. This is particularly necessary for our Romanian ecosystem.

Techcelerator is a valuable tool to scout for tech companies in the pre-seed phase. Depending on how they evolve here and if they can prove that there is traction for their product or service, we will assess them for additional funding. Naturally, we also look at alumni of acceleration or pre-acceleration programs from previous years or even companies that have not gone through an accelerator.

What does a business relationship with Gapminder look like? Are the startups getting additional support besides the money?

As investors, we enter the company’s shareholding, we align our interests with those of the founders and aim to become a team. In addition, we contribute to the company’s growth through improvements in regards to company governance, mentoring, facilitating entry into new markets and partnerships, feedback on products and their development, and the list continues.

What’s next for Gapminder?

Making the Romanian startup ecosystem more relevant to VCs from Western Europe, the US, Singapore, and Hong Kong. Our ecosystem already shows strong signs of becoming the Silicon Valley of Central Europe and has already produced a unicorn (Ed., UiPath) with a second one to come. We can add to this development by improving the qualities of investments – and we plan on doing so.

What piece of advice would you give to entrepreneurs and young startups?

Build a strong team, follow your vision, but adapt to the market needs. And then grind: energy and stamina are crucial, while knowledge can be gained.



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