White Star Capital raises new $180M fund to help startups go international

Global venture capital firm White Star Capital has closed a second fund of $180 million, money it plans to invest in “transatlantic” companies that need help to go international. The VC already has a presence in London, New York, and Montreal, and as part of its new fund is adding Paris and Tokyo to the list.

Oversubscribed from an initial target of $140 million, apparently, White Star says it will invest in around 20 new companies from the new fund, writing opening cheques of between $1 million and $6 million. White Star’s first fund of $70 million closed in 2015 and the VC has backed around 26 startups to date. Notably, the firm has already invested in eight companies from its second fund.

They span Seed to Series B and include fintech and insurtech companies Borrowell (Canada) and Clark (Germany), as well as “disruptive commerce” models Vention (Canada), Meero (France), and Butternut Box (U.K.). The fund has also invested in digital health companies Echo (U.K.) and Dialogue (Canada), as well as data-as-a-service company Unacast (US).

LPs in the new fund include institutional investors such as Caisse de dépôt et placement du Québec (CDPQ), Fonds de solidarité FTQ (FSTQ), the Business Development Bank of Canada (BDC), Korea Venture Investment Corporation (KVIC), Investissement Quebec, ARKEA Group, Mizuho Securities, Swen Capital Partners, Isomer Capital, Walter Financial, Clerville Investment Management, Temaris Capital, Simone Investments, and Portag3 Ventures. In addition, a number of multinational corporate groups have invested including Veolia, La Capitale, Corporate Groupe ADP, Ubisoft and Unisys Corporation through Canal Ventures.

In a call last week, White Star Capital Managing Partner and co-founder Eric Martineau-Fortin told me the VC will look to focus on three specific areas of investment. They are fintech, “disruptive commerce”, and algorithms and sensors.

Asked if most of the unbundling of various consumer financial services was now “done” and that we are now likely to see a next phase of consolidation, the VC didn’t disagree but pointed me to insurance, which is an industry still very much ripe for the picking. White Star has already made two insurtech investments and I got the impression it isn’t done yet.

The firm is also keeping an eye on how technologies like Blockchain is developing but Martineau-Fortin said he hasn’t been persuaded that the use cases were there quite yet.

More broadly, White Star’s new fund will continue to seek out companies that use data as a competitive advantage and where the fund’s “operational experience and physical presence can help companies scale internationally”.

Meanwhile, to help beef up its own global presence, White Star Capital has recruited Matthieu Lattes, who was previously a VC specialist at Rothschild, as its new Partner in Paris. In addition, Shun Nagao has joined as a Venture Partner in Tokyo, and Lylan Masterman has been promoted to Partner in the VC firm’s office in New York.

Alongside Martineau-Fortin (who tells me he is partly relocating from New York to Paris to lead the firm’s presence in France), the firm’s other personnel are Jean-Francois Marcoux (the former co-founder of mobile game publisher Ludia), and Christian Hernandez Gallardo (a former Facebook executive) who heads up White Star’s London operations.

Adds Martineau-Fortin: “Our growing team has extensive operational experience and we are passionate about supporting ambitious entrepreneurs with truly global ambitions. Internationalisation represents a huge opportunity for many high-growth companies and our global reach means we can support companies looking to scale outside of their home market. We become active partners to all the entrepreneurs we work with and the new fund will enable us to help even more companies realise their potential”.