The fund has already raised 74 million euros towards its target from some of the most successful entrepreneurs in Finland, including Ilkka Paananen and Mikko Kodisoja of Supercell and Jarkko Veijalainen of 3 Step IT.
CapMan Growth’s own commitment to the fund is 10 million euros.
“We have many high-growth companies and skilful entrepreneurs who have excellent chances for international success,” told Juha Mikkola, a managing partner at CapMan Growth.
The investment strategy of the fund is to acquire minority stakes worth 3–20 million euros in companies with a turnover of 5–100 million euros and develop them from two to five years together with the entrepreneurs. The entrepreneurs maintain majority ownership and decision-making power in the company but receive knowhow and financing to help them to grow their businesses further.
Antti Kummu, a managing partner at CapMan Growth, stated that minority investing is a good option in circumstances where the company is undergoing ownership changes or where the company is in a position to accelerate its growth with additional funding.
“Due to the coronavirus situation, companies need more skilled capital to steer growth forward,” he pointed out.
The fund made its first investment as the lead investor in a five million-euro funding round closed by Neural DSP, a Helsinki-based provider of cutting-edge sound processing software and hardware for musicians.
CapMan Growth established its first fund to considerable success in 2018. The investment firm already has a number of successful exits under its belt to show for its 11 investments, including from Fluido and Polystar. Its portfolio currently includes Coronaria, Digital Workforce Services and Picosun.