2021 was another record-breaking year for the investing members of the Estonian Private Equity and Venture Capital Association (EstVCA) with a total volume of investments reaching €290 million, which is a 70 percent increase compared to the previous year. In 2021, Estonian private equity and venture capital funds invested €155 million in various companies and made 14 exits.
At the end of last year, Estonian private equity and venture capital funds had €624 million of dry powder still to be invested, of which €212 million was in venture capital funds.
According to Margus Uudam
, Chairman of EstVCA, the Estonian private equity and venture capital market is characterized by maturity and international credibility. “The number of Estonian investors has constantly increased and the private equity and venture capital market grows at the fastest rate ever. There is a strong capital supply in the market, and thus, startup founders no longer have to accept the first offer they receive, instead, they can choose the right partner for their growth. Estonian funds and investors work closely with foreign funds, which value the received local experience and know-how. Cooperation with Estonian investors has become increasingly more attractive for those who seek an investment partner and are keen to take a closer look at the Estonian ecosystem and technology companies,” Margus Uudam said.
EstVCA members have 484 companies
in their portfolios, which employ 20,600 people
. Margus Uudam noted that Estonian private and venture capital funds are now large enough to participate in their portfolios' follow-on investments to help them reach the next investment rounds. Kadri Lindpere
, the Managing Director at EstVCA, added that Estonian private equity and venture capital funds attract new funding in larger amounts than before, and for several funds, the volume of the next fund has increased twofold. “Last year, funds raised the largest amount of capital ever, which is a clear sign of the trust of foreign investors in Estonia as a successful tech-oriented country. The PE/VC funds market emerged actively around five years go, and the first funds have now reached the final stages of their investment cycle and some are also making successful exits,” Kadri Lindpere said, noting that second and third funds are easier to raise, because of the successful track record and sound footprint. In 2021, 12 funds announced fundraising news.
Lindpere highlighted that in the current situation that has over the past few years spanned from crises to crises, it is important for the Estonian tech sector, as well as the state and organizations contributing to the development of the sector to continue their support for the growth of local startups and tech companies. “The biggest strength of our small ecosystem is the strong cooperation between different organizations. Together we have maintained and strengthened Estonia’s international image as a successful digital nation and an attractive investment destination,” she emphasized.
Margus Uudam adds that although last year was another record-breaking year, the following and even more ambitious goals have been set. “We will continue our cooperation with the Nordic and Baltic countries more systematically at all levels of the ecosystem, in order to attract even more investments and raise even larger amounts of foreign capital to the region,” he explained.
In 2021, EstVCA members made 19 exits
, of which 14 investments were made by private equity and venture capital funds. Successful exits build trust in the eyes of both tech companies and fund investors and build the ground for the continuous growth of the fund market and volumes. Estonian Private Equity and Venture Capital Association members' 2021 in numbers:
(As of December 31st, 2021)
The Estonian Private Equity and Venture Capital Association (EstVCA) is the representative organization of the private equity and venture capital industry and the industry support service providers in Estonia, whose assets under management amounted to 2.88 billion euros at the end of 2021. There are 484 ambitious companies in the portfolios of EstVCA's investing members and the number of employees of the companies reached 20,600 at the end of 2021. The main activities of EstVCA are related to strengthening and developing the ecosystem within three core focus areas: Nordic-Baltic regional cooperation, development of the Estonian tech ecosystem and activities related to the integration of members and associate members.
- ASSETS UNDER MANAGEMENT (AUM). Accumulatively all EstVCA investing members - 2.88 billion euros of which the AUM of private equity and venture capital Funds is 1.1 billion euros (€650 million in private equity funds and €450 million in venture capital funds).
- PORTFOLIO COMPANIES. The number of portfolio companies of the members: 484, of which 180 are in the portfolios of venture capital funds.
- NUMBER OF EMPLOYEES. The number of employees in portfolio companies: 20,600.
- INVESTMENTS. Members total €290 million, of which €155 million were made by private equity and venture capital funds.
- EXITS. In total 19, of which 14 were made by private equity and venture capital funds.
- DRY POWDER. Private equity and venture capital funds had in total €624 million of dry powder, of which €412 million was in private equity and €212 million in venture capital funds.
- MANAGEMENT BOARD. There are 11 members on the EstVCA management board: Chairman of the Board: Margus Uudam (Karma Ventures). Members of the Board: Kristjan Kalda (BaltCap), Sille Pettai (SmartCap), Marek Kiisa (NordicNinja VC), Allan Gaidunko (LHV Asset Management), Kristel Raidla-Talur (COBALT), Veljo Otsason (Superangel), Antti Perli (Ellex Raidla), Kristi Kurvits (Tera Ventures), Rain Tamm (Siena Venture Partners), Indrek Kasela (United Angels VC). The Manaaging Director of EstVCA is Kadri Lindpere.
Currently, EstVCA has 54 member organizations, the main members of which are Ambient Sound Investments, BaltCap, BPM Capital, Change Ventures, Eften Capital, European Investment Fund, European Bank for Reconstruction and Development, Iron Wolf Capital, Kaamos Group, Karma Ventures, KredEx, LHV Asset Management, Livonia Partners, Perot Jain, Siena Venture Partners, SmartCap, Superangel, Swedbank Investment Funds, Tera Ventures, Trind Ventures, Specialist VC, United Partners, UP Invest, and Wellman.