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500 Emerging Europe Makes a Unicorn Bet on the Region with €70M Fund

The 500 Emerging Europe team
Image credit: Press Release

•    VC fund 500 Istanbul, a joint venture of 500 Global, announced rebranding itself as 500 Emerging Europe, thus expanding focus from Turkey to include Central Emerging Europe (“CEE”) and the Baltics (“Emerging Europe”).

•    Through the fresh fund, 500 Emerging Europe will direct €70M towards globally-minded early-stage startups that leverage local talent from these markets.

•    This follows 500 Istanbul’s track record of successful investments in countries such as Poland, Ukraine, Romania, Greece, Bulgaria, and Hungary. 

 

After having witnessed the boom in the Turkish ecosystem, playing a strategic role as an early stage investor, 500 Istanbul – now 500 Emerging Europe – is looking to expand its presence in CEE and the Baltics. So far, the company has invested in 40 globally-focused companies from the region, which subsequently raised $1.1B in follow-on funding from international investors.

For startups leveraging local talent and resources but looking to export their technology to global markets, 500 Emerging Europe can be a partner to help fuel these ambitions from the very early stages. The fund is looking to invest in pre-seed and seed rounds, with first tickets as high as €2M, and substantial reserves for follow-on rounds.

Emerging Europe’s potential to create unicorns

At its launch in 2016, 500 Istanbul set to invest in Turkish entrepreneurs. Following the journey of Turkish startups led to the building a local portfolio of global-minded companies that had exported their technology abroad more and more, to hedge against local risks. So far, the fund has invested in global success stories such as Carbon Health, Insider, BillionToOne, and Firefly, and its portfolio has generated more than 95% of a total $600M+ revenue outside of Turkey.

The fund also realized that the “build locally, export globally” market strategy is not limited to Turkey. Given low population density and a lack of market depth pushes startups from Central and Eastern Europe to shoot for global markets, exporting their technology, while keeping local teams by tapping into abundant local talent resources.

Read more:  Bogdan Axinia from eMAG Ventures is looking for the next e-commerce unicorn in CEE

Such market dynamics differ from those of other emerging ecosystems such as Latin America, Africa, the Middle East or Southeast Asia, and thus require a different approach, which has shaped 500 Istanbul “emerging talent” investment thesis, Enis Hulli explains. 

“The thesis for 500 Istanbul revolved around investing in companies that leverage local tech talent but have global ambitions from the start. This thesis has resulted in three unicorns in our portfolio, as we tested out different markets in Emerging Europe. Startups from this region are global from the outset, uniquely positioning the region to potentially lead growth on the continent and create dozens of global unicorns every year,” 500 Emerging Europe General Partner Enis Hulli stated in the press release.

Bringing Silicon Valley expertise and a global network to Emerging Europe founders

Going forward, the fund will retain the two key strategic pillars of its investment thesis: tapping into the growing local tech talent potential and connecting founders to mature tech markets. 

As a joint venture of 500 Global, a VC firm investing in founders building fast-growing tech companies and managing assets worth $2.7B worldwide, 500 Emerging Europe aims to connect exceptional local founders with global market opportunities, notably in Silicon Valley. Out of 500 Global’s portfolio of 49 unicorns, 40 percent are outside of the U.S. 

“With this hyper-local and boots-on-the-ground approach, supported by our global network, 500 Emerging Europe aims to become the natural first stop for early-stage teams in the region with a vision for a global product supported by our global network,” 500 Emerging Europe General Partner Arın Özkula stated.
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https://therecursive.com/author/antoanelaionita/

Antoanela is a Deputy Editor at The Recursive, where she writes about climate tech, blockchain, and other high-impact innovations in Southeast Europe. She loves complex topics and translating geek to chic. Her holy grail is telling stories that have great potential for social and environmental impact. Prior to becoming a full-time journalist, she worked in various sustainability roles.
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