Berlin-based Cherry Ventures has announced the closing of its latest fund, totaling $500 million. The investment firm plans to allocate the capital across early-stage funding rounds and subsequent Series B and beyond rounds.
In a statement, Cherry Ventures articulated its ambition to leverage this fund to cultivate the “first trillion-dollar company in Europe,” actively challenging the prevailing “doom and gloom” narrative surrounding the European economy. While the goal is ambitious, evidence of European startups currently achieving this level of valuation remains limited.
One area where the disparity is especially evident is in artificial intelligence. If AI develops as projected, few of the most heavily capitalized companies in the field will be European. Recent figures show European AI companies raising approximately $8 billion, compared to approximately $97 billion raised in the U.S. for AI startups. While capital isn’t the only factor, it is critical for success, as Cherry Ventures and other venture capital firms understand well.
Cherry Ventures did not specify a timeline for achieving its aspirations. In the U.K., a major European startup market, venture capital funding for startups fell by 50% during October compared to the previous quarter, with approximately $2.9 billion secured, according to a Dealroom and HSBC Innovation Banking report.
Cherry Ventures itself did not appear in last year’s HEC-Dow Jones Venture Capital Performance Ranking, with Bek Ventures (formerly Earlybird Digital East Fund) taking first place. Balderton Capital, an investor in Revolut, recently secured $1.3 billion for European tech startups, and also noted that Europe is missing out on the AI boom.
Previously, Cherry’s last fund was announced in early 2022 and totaled €300 million ($312 million). The VC firm’s portfolio encompasses a diverse range of companies, including The Exploration Company (space tech), Flink (grocery delivery), Robeaute (neurosurgical microbots), Flix SE (Greyhound owner), and Forto (logistics). Key investors in the new fund include entrepreneurs like Miki Kusi from Wolt, Ilkka Paananen (chief executive of Supercell), and Jochen Engert from Flix. Cherry Ventures has already seen 18 successful exits, including CoW Swap, Ninetailed, and Homelike.
