Battery Ventures has promoted software investor Zak Ewen to partner, the firm will announce later today. Ewen will help manage the London office as Battery aims to expand in Europe – in every metric, he told PE Hub Europe.
“We’d love to increase our portfolio footprint,” said Ewen, who joined Battery in 2010. “We’d love to help our existing portfolio companies grow here, make more acquisitions etc, and to also do more new investments, like the Vimcar and Avrios combination.”
Battery last week made a combined growth-equity investment in Berlin’s Vimcar and Zurich’s Avrios, a pair of cloud-software providers for the fleet-management sector. They added to the more than 100 European-based firms in which Battery and its portfolio companies have invested since 2005.
Europe has typically provided 20 to 30 percent of Battery’s deployed capital, but as its overall funds have grown, the firm has been deploying more capital in Europe, said Ewen.
Founded in 1983, the firm is investing its 14th family of funds, Battery XIV and a companion fund, which have a combined capitalisation of $3.3 billion. It is also investing its $530 million Battery Ventures Select Fund II. Its London office was established in 2016, while it also has offices in Boston, San Francisco, Menlo Park, New York and Tel Aviv.
Battery invests in companies including software and services, enterprise infrastructure, consumer tech, healthcare IT and industrial technology and life-science tools.
“The unifying thread is that we invest in technology companies with IP,” said Ewen. “We do that regardless of stage, which is a fairly unique approach, doing it from one global fund. We have the benefit of seeing what’s happening at early stages.
“In Europe we’ve transplanted that stage-agnostic but sector-specific approach. We look for the best tech companies. We don’t have a geographic bias or preference.”
Last year, Battery invested in restaurant-software company Vita Mojo and life-sciences technology company Titian, both from the UK, and Proemion, a telematics-platform firm in Germany. Battery also re-invested in European ERP software company Forterro after that firm’s sale to Partners Group.
While Battery uses the same approach in Europe as it does elsewhere, Ewen said Europe has an edge in some sub-sectors.
“One thing that Europe does really, really well is technical software,” he said, pointing to CAD/CAM simulation as a highlight. “It’s where the best product truly wins because they’re products you can’t afford to get wrong. If you’re simulating an aeroplane engine, that’s not something you can afford to get wrong.”
That focus on product is another advantage for European companies.
“You tend to see businesses that are very technically astute but maybe haven’t been as commercially oriented,” he said. “In the US you tend to think sales first, product second. In most markets in Europe, it’s product first, sales second.”
Other sectors Ewen was positive on in Europe for 2023 included hospitality. As well as Vita Mojo for the restaurant business, Battery in 2019 invested in Mews, a property management software for hotels.
“Despite covid, we’ve seen quite a bit of resilience and bounce-back in those end markets,” he said. “Covid has shone a light on the ways that technology can help those businesses become more efficient and thrive during difficult times.”
Other sub-sectors of interest include manufacturing – “contrary to popular belief, our belief is that there’s a pretty strong manufacturing base across all of Europe” – and the public sector. “There’s been a lot of interesting initiatives and most European countries are pushing on digitisation around citizen engagement, things like that,” he said. “Europe leads the way on that front as well.”
Ewen also pointed to the “great public education system” across Europe and its “really strong” technical universities, as well as the region’s leadership on ESG. The latter means there are “a lot of technology businesses that we think are compelling coming out of Europe, more so than the US”.