Catalyst Fund Management & Research at the end of June held a GBP23 million (ecu 34 million) first closing on the European Financial Services Venture Fund (EFSV). Co-founded by Rodney Schwartz and Jussi Laurimaa, Catalyst set out to build a core shareholder base of top-ranking insurance and banking groups that look set to maintain leading positions in the fast-evolving financial services industry.
ING was the first investor to commit to the niche-focused fund. The Dutch banking group has been joined by high-calibre investors, including its compatriots Kempen, an independent merchant bank, and insurance company Stad Rotterdam; the Swiss insurer Winterthur; and, from the US, broker Legg Mason and money management group NVest LP. Catalyst, which aims to close EFSV on GBP40 million to GBP60 million, reported that it had firm indications for an additional GBP6 million-plus at the time of its first closing.
EFSV is in a unique position as the only venture fund dedicated to investment opportunities in retail financial services companies and the specialist technologies and services that underpin the sector. Through participation in the fund, core investors gain access to a valuable window on cutting-edge concepts and technologies in the fast-changing and highly competitive European financial services sector.
As Catalyst broadens its marketing effort to include a wider range of institutional investors, Jussi Laurimaa is confident that EFSV will also deliver enviable financial returns. “The prospects for returns are truly breathtaking”, he said. “Since we launched the fund in February, more than 75 companies that meet our criteria have approached us, some of which appear capable of staggering performance”.
Catalyst, which portrays itself as an “agent of change in European retail financial services”, will invest in early- to mid-stage companies with strong growth prospects. EFSV will normally seek to invest around $5 million (ecu 4.5 million) per deal, although its core partners may coinvest to allow the vehicle to undertake significantly larger deals