One swallow does not make a spring. But four?
One swallow does not make a spring. But four?
Hard2beat has just announced its first three investments. A month earlier, a BidFinance round was also recorded, led by 4growth. All four of these rounds are seed rounds and were implemented with the participation of funds using EU funds (FENG program). New money has entered the market, but what exactly does that mean?
In 2024, PFR Ventures signed the first 9 agreements with venture capital fund management teams that will benefit from EU funds (FENG). Their strategy assumes financing of around 150 innovative companies by the end of 2029. Ultimately, more funds are to appear, which will also translate into an expansion of the group of projects potentially supported by funds.
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In order to properly reflect the potential impact of new funds on the market, a handful of market statistics will be useful. In the years 2019-2023, ~80 seed transactions were recorded per year. This period is indicated for a reason. At that time, VC funds were also active on the market, supported by funds from the previous EU perspective (POIR). They were responsible for about 60-75% of all transactions. After the end of the investment period of these funds, market statistics fell sharply by... 70%.
Number of seed deals on the Polish VC market, quarterly. Source: PFR Ventures and Inovo.vc reports .
The above statistics, in the years 2019-2023, were influenced by a group of about 60 funds using NCBR funds (so-called BRIdge Alfa) and 30 funds funded by PFR Ventures. Both institutions used EU capital for allocation. In the case of PFR Ventures, the first agreements were announced in mid-2018 (7 teams, of which 5 were eventually launched). These teams announced their first four investments in April 2019. The capital then went to Activa, Sundose, Zeme and Talkin' Things. A month later, a meeting was organized at Impact'19, where PFR Ventures announced a package of 9 first investments, at the same time informing that the financed companies acquired over PLN 40 million (of which ~PLN 16 million was EU capital).
Since then, the influence of PFR Ventures funds on the Polish VC market has been gradually growing. In 2020, this translated into 74 transactions with their participation, and in 2023 there were almost twice as many. It is worth adding that in the meantime, further agreements were signed, and PFR Ventures began to allocate PFR capital in parallel with EU funds. Therefore, in 2024, despite the lack of activity of funds supported by POIR and the initial phase of FENG's operation, the funds participated in 34 out of 150 transactions on the Polish VC market. The first investments from the "new deal" went to BidFinance, DefendEye, Defguard and Neuromedical. Comparing them to those from the first group from POIR...
… there is no comparison. Most funds remain generalist, so we can expect transactions in very different areas. However, what attracts attention is a project that emphasizes its dual-use potential. Market trends and the situation in the region indicate that such companies may be growing.
See all investments based on POIR funds
It should be expected that the launch of funds by 2 of the 9 funds under the FENG umbrella is the beginning of a change in the market trend that will be observed in the coming months on the Polish VC market. Similarly to the "joining in" of funds supported by POIR, the change will intensify in the coming months, and it will be intensified by the remaining management teams that will soon start investing and the next teams to which the funds will be allocated.
Seed financing is back.
Side note: communication perspective
Weekly average number of round announcements by year.
Four rounds in 2022 = a slightly better week
Four rounds in 2025 = twice the weekly average from 2024
The growing number of rounds will certainly also make it more difficult to "break through" with information. Recipients will switch from "oh, they managed to collect something" to "another seed of PLN 4 million", and editors will want to describe only the most interesting transactions.
