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Ada Ventures today closed its second fund of £63m, which was oversubscribed by institutional LPs. Fund II’s new LPs include the Danish Export and Investment Fund (EIFO), the University of Edinburgh, Molten Ventures and Legal & General Capital.
They are joined by Return Fund I LPs Atomico, Big Society Capital and British Business Bank. Several founding investors also participate, including Wise founder Taavet Hinrikus and Illusian, the family office founded by Ilkka Paananen.FiCo-Founder and CEO of Supercell.
Established in 2019, Ada’s Fund I portfolio (including Huboo, Boundless, Greenworkx and Bubble) is on track to generate revenues of £100m in 2024.
The value of inclusion in practice
The Fund developed and is currently pioneering the “Inclusive Alpha®” approach, which supports the coexistence of “Alpha” ideas and commitments to inclusion.
This investment strategy focuses on beating the market using funds from a comprehensive infrastructure and investment approach. Ada Ventures embeds this commitment to inclusivity at every step of the investment process.
This includes providing founders with access to mental health support and being the first in Europe to support parents in their portfolio with child support. Since launching in October, nearly 15% of the company’s portfolio companies have already adopted the initiative.
An analysis conducted in February 2024 also revealed that Ada Ventures:
- Across all benchmarks, it is 14 times more diverse in terms of gender and race/ethnicity than the broader VC market.
- 74% of portfolio founders come from underrepresented backgrounds.
- 48% of Ada portfolio companies have female founders (compared to 18% in the overall VC market).
- 4% of Ada portfolio companies are led by ethnic minority founders (compared to 9% of companies funded by the broader VC market).
The company has also pioneered the use of scout and angel networks, with nearly 100 scouts across the UK and a 20-strong group of ‘Ada Angels’ each with access to an investment pot of up to £50,000. There is.
To date, 30% of investments from Fund I and Fund II have been raised through the Ada Angels or Ada Scout network.
Fund II capital will see the team invest between £250,000 and £1.5m in pre-seed and seed-stage startups, with a significant amount allocated to follow-on investments.
The firm plans to make 10 to 12 investments a year in companies building breakthrough ideas around climate equity, economic empowerment, and healthy aging.
Check Warner, co-founder partner at Ada Ventures, commented:
“We are excited to announce the final close of our second fund and share more data on portfolio diversity and performance. These metrics demonstrate how powerful our Inclusive Alpha approach is. I believe this shows how effective it is.”
We have worked extremely hard over the past five years to develop the systems and processes that will enable us to realize our ambition to build a truly diverse and inclusive fund.
High returns are strongly correlated with comprehensive investing. We want other funds to emulate this blueprint.
The excuse that diverse talent does not exist “in the world” is tantamount to a police crackdown. We have proven that we can build a successful and exciting portfolio of diverse founders who build breakthrough products and highly valuable businesses. ”
Chris Hopkins, Managing Director, Venture Capital, Legal and General Capital commented:
“We are delighted to invest in Ada Venture’s second fund and support a wide range of investment strategies to expand access to capital and address the lack of diversity within the UK and European VC ecosystem.
Diverse teams drive growth and better outcomes, and Ada Ventures’ holistic approach targets a group of emerging companies developing innovative solutions to society’s biggest challenges.
The second oversubscribed fund is a fundraising success story and demonstrates the industry’s growing awareness of these issues. ”
Lars Nordal Jensen, Head of Fund Investments at the Danish Export Investment Fund (EIFO), commented:
“We are pleased to join Ada Ventures as an investor in our second fund as we continue to expand our Inclusive Alpha approach internationally.
Ada Ventures is led by a savvy team that has developed a systematic and comprehensive approach to venture capital. As such, Ada Ventures may be well-positioned to further exploit the potential business opportunities that exist when investing in more diverse companies. Founders.
Ada’s approach to investing shows that you don’t have to sacrifice big LP returns to build a more diversified portfolio. ”
Lead image: ADA Ventures. Photo: No credit.
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