Fuel Ventures launches its new $63.6M early-stage VC fund, aiming for 60 startups inside 12 months

You may have heard of payments startup Paddle, which has raised $93.3 million. Or perhaps Heroes, which raised $65 million to become the “Thrasio of Europe.” But you might not have heard so much about a backer of these startups: Fuel Ventures. At least not yet.

That’s about to change, as Fuel Ventures comes out of the door with a new £45 million / $63.6 million early-stage focused VC fund, aiming at 60 U.K. tech startups over the next 12 months. This is quite the pace for an early-stage fund, but Fuel’s founder and managing partner Mark Pearson told me at length how he is confident of making it one of the most prolific early-stage investors in the U.K.

Since launching in 2015, Fuel has raised £80 million in capital to invest in seed and series A founders, and the VC will also be aiming for pre-seed ventures with the new fund.

In the last 12 months Fuel says its founders have raised over £180 million in follow-on funding. Notable investments include: OnBuy (e-commerce marketplace), Capdesk (equity management platform), OutFund (alternative finance provider), Heroes (scaling Amazon businesses) and Moot Group (homeware and furnishing e-commerce business).

Mark Pearson, founder and managing partner of Fuel Ventures, said: “Since we launched our first fund five years ago the country’s tech ecosystem has gone from strength to strength and evolved into an ecosystem that’s the envy of many around the world. Now is not the time to take the foot off the pedal and say job done. We have a responsibility to invest in the future of the U.K. tech landscape and build on the strong work done so far. This, for us, means making sure we are providing capital for forward-thinking entrepreneurs and their innovative early-stage businesses — even if that means just having an idea or MVP.”

In addition to the new £45 million fund, Fuel is also opening up a workspace in central London to serve its portfolio.

Speaking to me over a call, Pearson, who cut his teeth at a startup called MyVoucherCodes, said: “I exited that successfully and left it with about 10 million in revenues. I then started to be a pretty active angel investor, such as in Paddle. When I sold my company I decided to do this full time and found there weren’t many entrepreneurial investors with startup experience themselves, compared to what you see in the U.S. So I put my entrepreneur hat on, trying to be as founder-friendly as possible. That was five years ago when Fuel Ventures started.”

He told me: “I still think there’s a funding gap between the seed and the Series A. We have always sat in the seed stage. We wanted to just write a decent check to allow these companies what it takes to hire the best talent, build out their product at scale and get them into the institutional funds. We can help you, we will roll up our sleeves, and we’re going to build the business with you. Our network of investors and LPS tend to be entrepreneur types as it is.”

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