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Blossom Capital’s latest funding round showcases jump in U.S. investment in European venture funds

Blossom Capital’s latest funding round showcases jump in U.S. investment in European venture funds

If it is possible to hear an eye roll down a phone line, I’ve just heard it.

I’ve just asked Ophelia Brown, the 33-year founder of London’s Blossom Capital, the question she is sick of answering: what’s it like to be a woman and a founding partner of your own firm in the still male-dominated venture capital sector?

“It really annoys me because I don’t think this should be part of the discussion anymore,” she says with a withering sigh. “People should be assessing us on our performance, the same way they do with any manager. The female part should be removed out of the equation.”

Brown’s Blossom is certainly performing. The firm announced Wednesday that it had raised its second fund, a $185 million investment pool aimed at Europe’s early stage startups, less than a year after closing its inaugural $85 million one.

That first fund is ranked in the top 5% of those raised in the U.S. and Europe last year, according to data from Cambridge Associates and Prequin.

That performance convinced Blossom’s own backers—which include U.S. institutional investors as well as wealthy individuals—to invest in the second fund, which took just three months to raise.

The new fund is further evidence of the influx of U.S. money into European venture funds and European startups. Funding rounds in Europe involving U.S. investors jumped to $16.6 billion last year, up from $10.9 billion in 2018, according to data from Dealroom, which tracks those flows.

Among the startups Blossom backed in its first round are business travel site Duffel, payments company Checkout.com, the rent-anything marketplace business Fat Llama, and the cyber security firm Tines.

Brown, who studied classics, philosophy and ancient history at the University of Oxford before getting an MBA at INSEAD, worked in investment banking before cutting her teeth in venture capital working for Index Ventures, one of Europe’s most established VC firms and also an active investor in Silicon Valley.

At Index, Brown helped oversee a number of the firm’s American investments, including financial technology startup Robinhood, the U.S.-based free stock trading app. (Robinhood co-founder Vladmir Tenev was reportedly an investor in Blossom’s first fund.)

After almost four years at Index, she became a general partner at LocalGlobe, a London-based venture firm that originally specialized in seed funding that was co-founded by long-time Index Ventures veteran Saul Klein and his father Robin Klein. She left to found Blossom in 2017.

Brown acknowledges that diversity is an important factor in Blossom’s approach—but she doesn’t like to view diversity through the monocle of gender.

“It is important to have a diverse partnership, but diverse in terms of race, ethnicity, and upbringing,” she says. “They’re all important.”

Blossom’s partners include two women—Brown and Louise Samet, who was a product manager at Swedish payments firm Klarna before becoming a tech investor herself—and two men, Imran Ghory, who was an engineer before entering venture, and Mike Hudack, a Facebook veteran who, in addition to his role at Blossom, was the chief technology and chief product officer at Deliveroo, the fast-growing food delivery business which is now backed by Amazon. Deliveroo announced earlier this week that Hudack is leaving the company as part of a large management reshuffle in which several other top executives are also departing.

Brown does allow that she and Samet assess companies somewhat differently than Ghory and Hudack. “Men and women do judge different products differently.”

She says that even though Blossom’s team is small, it doesn’t make investment decisions by consensus—in fact, Brown isn’t a big fan of a consensus-driven approach. “We have disparate opinions,” she says, and she says Blossom’s process is designed to draw out those disagreements.

Most venture capital firms that do early stage investing—defined as seed capital and Series A rounds —invest in a dozen to two dozen companies from a single fund. Blossom is fairly unique in taking a more concentrated—and risky—approach: it invests in just five companies each year, Brown says.

She says this allows the firm’s four partners to devote far more time to each portfolio company than is typical of most other VCs. But it also means greater risk, she acknowledges.

“We are not using the portfolio to diversify or derisk,” she says. “Every company counts for us.”

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