Nordic impact firm Unconventional Ventures (UV) has reached a €50m first close on its second fund, aiming for a total of €80m.
The fund is backed by investors including the European Investment Fund (EIF), Danish sovereign fund EIFO, Nordea-fonden, Augustinus Fabrikker, TryghedsGruppen, and a number of undisclosed family offices.
General partner Nora Bavey tells Sifted the majority of investors from fund one backed this fund, alongside five new LPs.
“Those who didn’t continue from fund one to fund two were mainly high-net-worth individuals, who unfortunately don’t have the capital to move right now,” she says. “That’s a reflection of the market.”
The new political climate under US president Donald Trump’s administration, which earlier in the year called on American and European companies to dump their corporate DEI initiatives, has led to reduced support for funds and accelerators focused on women and underrepresented founders, according to Bavey.
But this has only strengthened Unconventional’s resolve, says Thea Messel, its founding partner.
“When you invest in diverse founders, you unlock new markets, overlooked opportunities and future-proof solutions,” says Messel.
“Fund two is about going bigger, bolder and proving that equity and returns can, and must, coexist.”
The second fund will focus on pre-seed and seed-stage investments across impact verticals such as climate and sustainability, health and education. UV sees AI as a background enabler rather than a primary investment thesis.
“For us, AI and deeptech are hygiene factors. We have never marketed ourselves as a deeptech AI fund. We don’t need to when we focus on these three areas and the builders,” Bavey says.
“It’s more about how applicable it is and how global it can become. That’s where we come in.”
Challenging the structural biases in VC
Bavey highlights UV’s early backing of Swedish battery company Drev, which announced its €2.8m seed round last week, as one of the highlights from its first fund.
She mentions UK-based climate fintech Climate X as one of the fastest-growing startups in UV’s portfolio. It’s preparing for a Series B, Bavey says.
Unconventional Ventures was founded to challenge the structural biases in venture capital that see only 1-2% of money invested in Europe go to all-women founding teams, and less than 0.5% to startups founded by ethnically diverse people.
Apart from a few investments in the UK, and one each in Germany and Spain, UV has invested only in the Nordics, where its two general partners are based.
With the new fund, they’ve appointed Alexis Horowitz-Burdick — previously on its investment committee — as the firm’s third general partner. She’ll spend half her time in the US and half in the Nordics.
“Some of our portfolio companies have a presence in the US market. The competence we have from having feet on the ground and insight there is valuable,” Bavey says.
“[Alexis] also built up Lego Ventures, so she’s much more Series A and later stage,” she adds.
“We’re starting to see an incredible pipeline at that stage, and we wanted a GP with that expertise who can help our companies now that many of them are growing so quickly.”
