Venture capital firm 14Peaks Capital has closed its first fund at $30 million in capital commitments from an impressive consortium of limited partners (LPs), consisting of influential High Net Worth Individuals (HNIWs) and family offices spanning Europe and the United States.
Established in 2022 by Edoardo Ermotti, the fund’s solo General Partner (GP), 14Peaks invests at the earliest stages (from pre-seed to series A) in B2B SaaS companies, with a specific interest in Fintech and the Future of Work.
The team is already investing out of its first fund and has 11 companies in its portfolio to date. These include US-based HR/Payment platform Rain (who last year raised $66M in a Series A round), finance and accounting platform FlowFi (who recently announced its $9 million seed round) and Switzerland-based data collaboration company Tune Insight among others.
At a time when AI continues to drive rapid change in the B2B landscape, sparking first-mover competition between established and new founders to bring the power of this new technology to business operations, 14Peaks is laser-focused on investing in proprietary technology that has the potential to build strong defensible moats.
Against this backdrop, 14Peaks’ focus across Fintech and the Future of Work is expansive, ranging from data collaboration and workflow automation, to payment software and fraud detection.
Most venture funds set out to raise capital from as many LPs as possible. When fundraising, Edoardo Ermotti took a unique approach. Before founding 14Peaks, he began investing as a business angel in 2019. To date, he has supported over 25 companies and has selectively invested in funds as a limited partner.
Concurrently, he gained experience at a mid-market private equity firm in London. Subsequently, he transitioned to a family office, initially based in Switzerland and later in the US, where he spearheaded the development and leadership of the early-stage investment division.
Over the years, he regularly co-invested alongside HNWIs and Family Offices who all shared the same view: they were progressively less interested in allocating their capital to funds with hundreds of Limited Partners (LPs).
Funds with larger LP bases tend to have limited transparency into fund activities, fewer co-investment rights, and a generally passive approach to their relationship with the smaller LPs.
Edoardo Ermotti wanted to create a closer, stronger relationship between GPs, LPs, and founders by raising from an intimate circle of highly-vetted, seasoned executives and entrepreneurs who could take a more active role in supporting portfolio founders, exchanging ideas, and co-investing with people they trust.
“When I started 14Peaks Capital, I wanted to shake things up in how GPs and LPs work together. I’ve been on the LP side before, spoke to many GPs, and knew there was room for a different approach,” said Edoardo Ermotti, founder of 14Peaks Capital.
“Each of the investors supporting 14Peaks is globally successful in their own right, giving our portfolio founders access, through us, to this curated hub of extensive experience and networks.”
In addition to access to its all-star assembly of LPs, 14Peaks works closely with its portfolio companies to accelerate traction through targeted go-to-market strategies, recruitment, and general company building efforts
With a base in Europe and a vast network in the US, the fund also helps companies expand beyond their domestic markets – whether venturing overseas from the EU to US or across Europe.
“14Peaks has been an incredibly supportive investor. Ever since we met them, the team has rolled up their sleeves and been very hands-on and proactive in transforming us into an organisation that can truly scale in an emerging market,” said Han Sahin, the co-founder of a Netherlands-based cybersecurity company, Threatfabric, that 14Peaks invested in last year.
The goal with portfolio support, similar to Edoardo Ermotti’s approach to fundraising, is close collaboration: the fund only invests in companies where there is a clear pathway for their engagement to generate additional value. This, Edoardo Ermotti says, is the best way to align interests with founders and together build next-generation companies.
“We’re looking forward to diving back in and supporting our founders as they chase their visions. In the past year, we’ve already seen positive changes in our portfolio companies, and we’re confident we can do even more as we expand our platform. Our hands-on approach and the power of our extensive network, fuelled by our tight GP-LP interactions, make us believe we’ll keep making a real impact for our founders in the years to come,” adds Edoardo Ermotti.
14Peaks’ portfolio founders are so far seeing the results of this new paradigm of GP and LP interactions and the network effects of this close circle. Alex Bradford, the founder of Rain, a HR platform 14Peaks invested last year, said: “14Peaks has been a fantastic partner and instrumental to our growth, plugging us into highly-valuable investor networks and boosting our go-to-market by sitting down and helping us craft business development strategies.”
14Peaks Capital AG has a team in Switzerland. Plans are underway for team expansion in the United States later this year, with strategic hires focused on enhancing market coverage.
The collective team brings forth deep experience in investing and supporting founders across various stages and verticals in Europe and the US, with a primary emphasis on B2B SaaS and Fintech.
Looking ahead, 14Peaks aims to expand its portfolio to a total of 25 companies out of its first fund over the coming years. In the meantime, Edoardo Ermotti and the team’s top priority is maintaining a concentrated focus on demonstrating the efficacy of their unique model, not only to their LPs, but, crucially, to their founders.
