A European venture capital firm, Kompas VC, is positioning itself to navigate an increasingly divided global economy by adopting a regionally tailored investment strategy.

With fresh funding of €160 million, the firm aims to support startups that can thrive despite growing geopolitical, cultural, and economic fragmentation.

Operating from key innovation hubs including Amsterdam, Copenhagen, Berlin, and Tel Aviv, Kompas VC is targeting opportunities shaped by the distinct trajectories of major global blocs such as the United States, Europe, and China.

According to partner Sebastian Peck, the firm recognizes that each of these regions is evolving differently, requiring a more nuanced investment approach.

Rather than chasing trends dominated by artificial intelligence and rapid scaling, Kompas is focusing on industrial and physical economy sectors.
Its investments are centered on areas such as manufacturing, supply chains, infrastructure, and sustainability fields it believes remain essential despite shifting market narratives.

Kompas VC has carved out a niche in supporting startups working on decarbonization, productivity, and risk management within the physical goods sector.

While these themes were widely popular during the firm’s founding in 2021, the current investment climate has shifted significantly. Still, Kompas maintains that its focus offers long-term value, especially as global markets adapt to new economic realities.

The firm’s second fund will allow it to lead early-stage investment rounds, typically contributing between €3 million and €5 million per deal.
While smaller than some global venture funds, Kompas sees its size as an advantage, enabling it to move quickly and specialize deeply in selected sectors.

Its European base also provides access to diverse founders, although market fragmentation remains a key consideration in scaling startups globally.
One example highlighted by the firm is prefab housing, which is widely accepted in Scandinavian countries but faces cultural resistance in other regions such as Germany and the United States.

This underscores a broader challenge for investors: even scalable technologies may struggle to expand internationally due to cultural and market differences.

As a result, Kompas emphasizes careful evaluation of addressable markets before committing capital. Despite these challenges, the firm views global fragmentation as both a risk and an opportunity. With a long-term investment horizon of 10 to 15 years, Kompas believes it is well-positioned to adapt to shifting political and economic landscapes.

Its strategy focuses on identifying overlooked opportunities and supporting founders who can build resilient businesses within their specific regional contexts.

Source: TechCrunch