Warsaw’s Inovo VC closes third fund at €105M, eyes unicorns in CEE region

Warsaw-based Inovo VC, an early-stage VC fund, announced on Tuesday the final close of its third fund at €105M, surpassing the original target of €100M. 

Private investors, who account for more than €55M managed by Inovo, have been joined by distinguished institutions such as IFC — a member of the World Bank Group, European Investment Fund, and Poland’s PFR Ventures. 

Inov Fund III

With the third fund, the VC plans to invest in 20-30 companies with a single investment ticket spanning from €0.5M to €4M and follow-on investments of up to €10M. 

Inovo VC will invest in startups at the Seed stage. However, it can occasionally join companies in pre-seed and Series A rounds across Central and Eastern Europe and founders from this region.

Inovo VC: A generalist fund

Inovo is a generalist fund, but its investment team is especially capable in areas like healthcare (Inovo invested in Infermedica, Jutro Medical, uPacjenta, and Index Health), developer tools (Spacelift, Archbee), and AI & Machine Learning (Zowie, Pathway, Quantum Boost, AI Clearing), with business models spanning from SaaS-enabled marketplaces, through B2B2C, B2B, to enterprise B2B. 

The Warsaw-based fund has already invested alongside notable funds like A16z, Google’s Gradient Ventures, Insight Partners, Point Nine, and Tiger Global Management. 

Out of 30 portfolio companies of Inovo VC, six have already surpassed €100M. They are Booksy, Infermedica, Packhelp, Preply, Spacelift, and Tidio.

Inovo’s previous funds

Launched almost a decade ago, Inovo’s first fund is already in its exit phase. It has already seen a 1.2x Distributed to Paid-In Capital (DPI), with still unrealised investments in its top performers – Booksy and Restaumatic. 

The second remains active, but only participates in the follow-on funding rounds of its existing investments. 

Over 65% of capital invested in Inovo Fund III by the private LPs comes from recurring investors, who have already joined prior funds and express continuous confidence in investment decisions and fund performance. 

Private investors consist of European family offices and Polish tech entrepreneurs, including Rafał Brzoska, founder, and CEO of logistics company InPost, Marcin Żukowski, co-founder of Snowflake, and Aternus Investment Group owned by the Wałach brothers, founders of consumer healthcare company Walmark.

Private LPs are joined by institutional investors, who account for 40% of the fund’s AUM, including IFC, European Investment Fund, and Poland’s PFR Ventures. 

Michał Rokosz, Partner at Inovo VC, says, “Over the last nine years, we’ve seen remarkable growth of the CEE startup ecosystem. Startups in the region have quadrupled in the last five years, totaling €190B as of 2022. Inovo LPs and portfolio companies contributed to that number significantly. And while we are in a period of a global funding slowdown, we still see companies in the region that can grow to $100M in revenue in just a few years.”

“We remain confident that CEE will raise at least ten new unicorns in the upcoming 5 years, and we want Inovo to be a key contributor to this achievement, actively helping the most ambitious founders”, he adds. 

Maciej Małysz, Partner at Inovo VC says, “We have managed to become a fund of choice for Polish founders, helping them grow beyond their home market and even their home region. Two third of our portfolio companies managed to raise follow-on rounds with top-tier international VCs.” 

“One-fifth of the portfolio companies already surpassed a valuation of over €100M. We want to help companies from all around our region grow and raise globally and ultimately strengthen the links between CEE and the global VC ecosystem,” adds Malysz.