New venture fund looks to boost number of European cloud firms

Organisations looking to move to cloud could soon be offered more choice.

A venture capital firm focused onCloud Computing and Software-as-a-Service markets has acquired a $100 million fund to invest in fledgeling cloud companies across the UK and Europe. 

Stephen Chandler, managing partner and co-founder of Notion Capital, said "Our strategy is to only invest in what we know, and we think this gives us a strong advantage in the market for both evaluating and supporting companies.

The fund has been backed by the UK government’s Enterprise Capital Fund programme and the European Investment Fund. Notion Capital has a strong portfolio of cloud-based companies, including Star and MessageLabs. "Coming from a background assuccessful entrepreneurs before becoming investors, we believe that we can see business opportunities where some ‘career investors’ might not. Not only that, but we can help advise companies on how they can turn their ideas into tangible revenues," added Chandler.

He went  to say that Notion was aiming broader than the UK market. “We aim to identify and support European companies that can become global leaders and generate exits that can be measured in the hundreds of millions. We have a bias towards Europe because we believe there are tremendous opportunities here and the market is under-supplied with high quality funds. Although it has been one of the most challenging environments to raise a fund in living memory, there are a good number of people out there who recognise the opportunity and the work Notion has done with companies so far”.

When asked about criticisms of UK funds in general, which often on cash flow projection over number of customers, compared to those of the US, Chandler told Cloud Pro “that’s a fair criticism of the UK market in general. Too many European funds focus on protecting the downside rather than thinking about the opportunity and shooting for the stars. That said,there are also too many entrepreneurs who don't think enough about how their business proposition will actually make money. Unlike B2C where value and revenues seem to have little link, in B2B there is generally a more established link and we want to see that therevenues will come.”