Index jumps into growth game

Early stage venture firm Index Ventures said in late January that it had raised about $585 million for its first growth fund, following the lead of several of its U.S. counterparts.

The Geneva-based firm says it is the first European venture capital firm to raise such a fund. Early stage venture firms in the United States have been jumping on the growth bandwagon for the past year. U.S. firms that raised inaugural growth funds in 2007 include Draper Fisher Jurvetson, Ignition Partners, North Bridge Venture Partners and Redpoint Ventures.

Index says Index Ventures Growth I will complement its venture fund, Index Ventures IV, which focuses on seed and early stage deals.

It expects to make investments of between $30 million and about $73 million in European-based technology and life sciences companies. It will also consider investments in companies in Eastern Europe and the United States that want to expand internationally.

“There is now a critical mass of companies that have the potential to be market leaders and make a global impact,” Index co-founder Giuseppe Zocco said in a prepared statement. “With the growth fund, we have the ability to find and support these companies, helping them get to the next level.”

Zocco told Reuters that he expects other European firms to follow in Index’s footsteps. “We hear rumors that there may be another one or two more coming along this year,” he told the news service.

In addition to Zocco, the growth team is comprised of Dominique Vidal, who was previously CEO of Yahoo Europe, Guido Magni, who was formerly global head of medical science for Roche, and Tony Zappalà, who has been with Index since 2005.

“The new fund gives us the ability to continue working with successful early stage companies that have become growth opportunities, leveraging the knowledge, methodology and network across both the venture and growth teams,” Magni said in a prepared statement. —Lawrence Aragon