- Saul Klein’s VC firm LocalGlobe re-formed as the Phoenix Court Group after raising $500 million.
- The veteran VC believes Europe can be a “new Palo Alto” as investor appetites grow on the continent.
- The company will now oversee four separate funds investing in startups from pre-seed to scale-up.
British venture capital veteran Saul Klein has transformed his investment firm after raising $500 million in fresh funds to support start-ups across Europe.
Klein made early-stage investments in a number of high-profile startups, including trading app Robinhood and payments firm Wise, through his VC firm LocalGlobe, which has been renamed Phoenix Court Group.
The revamp goes beyond the new moniker as the investor expands its focus to bet on founders at all stages of the startup growth cycle, including their entry into the public market.
Europe’s startup ecosystem has evolved from a hub for early-stage startups to the “new Palo Alto,” according to Klein, who said the transformation took 20 years.
The region is home to a number of multi-billion dollar startups, including struggling buy-now-pay-later giant Klarna, London-based fintech Revolut and online payments company Checkout.com.
For Klein, the “new Palo Alto” region – which he describes as European regions within a four-hour train journey from London – has been underserved by investors, particularly in the scale-up phases, leaving a funding gap that has not been adequately filled when compared to the US and China.
“It took 20 years to get to the starting line and now it’s getting interesting in this geography,” Klein told Insider. “All of this ties together for us in this vision of what the next 20 years of investing in innovation can be about, specifically this ecosystem we call New Palo Alto.”
The Phoenix Court Group now oversees four separate funds. His four funds include seed- and pre-seed-focused LocalGlobe, Basecamp, a community of 50+ early-stage investors, Latitude, an investment vehicle for early-growth companies, and scale-up fund Solar, which will back companies all the way to the public markets, with the company attempting to hold shares in companies while they list.
Shifting from Klein’s VC firm to a “life-stage” tech investor after making a name for itself as a seed specialist, is the latest move by a VC to restructure its approach to fund management to capture opportunities in both young and as well as in more mature companies.
Heavyweight VC Sequoia hired a number of general partners in Europe last year to support start-ups on the continent, with the firm’s Sequoia fund targeting both seed and growth stage investments.
The $500 million raised marks a first close for Phoenix Court Group, which will continue in discussions with limited partners to raise new funds to invest in seed-stage startups in what it calls “the third largest innovation ecosystem in the world”.
Despite the current market downturn, which has wiped out valuations of several tech companies worth billions of dollars, Klein remains bullish on LP’s appetite for investing in VC funds, given the longer-term horizon over which startup investments are made.
“Those who can’t see beyond the next 2 years shouldn’t invest in this asset class, shouldn’t invest in science technology or innovation, because the innovation dividend is in 10-20 years, not 10 days,” he said.
Phoenix Group Court’s investment team now comprises 13 partners, having hired Paul Bishop from UK pension fund Railpen’s private markets team, and will continue to expand as it sees opportunities in sectors such as Web3 and corporate infrastructure.