Voima Ventures is one of the great cases when a VC fund manages to persevere through challenging times by staying true to its investment strategy and building unique positioning on the market. So far, the firm has closed nearly €200 million in assets under management, with a total of 37 companies in its portfolio, across three funds.
AIN had a great opportunity to talk with Inka Mero, founder at Voima Ventures, about the fund’s recent activities, successes and challenges, as well as discuss the state of the Nordic and Baltic markets.
Tell us more about Voima Ventures.
We are a leading deep tech venture capital firm based in Helsinki, Finland & Stockholm, Sweden, specializing in science-based investments. We were founded in 2019 by (Mrs) Inka Mero, a seasoned and well-known angel and serial entrepreneur in the Nordics. Partners include Jussi Sainiemi, Pontus Stråhlman and Investment Director Jenny Engerfelt, as well as Niko Elers who is our investment manager.
Voima Ventures is driven by a mission to support visionary entrepreneurs working on breakthrough technologies that have the potential to solve global challenges and create significant societal impact. To this end, our latest Fund III is Article 8 compliant, and offers transparency into the environmental impacts of all our investments.
Our investment strategy revolves around backing early-stage startups with cutting-edge science and technologies, global markets, and scalable business models. We find the rare companies that leverage deep technology, usually developed out of years of university research, that address pressing societal and environmental challenges — solutions for the people, planet, and industry — while also demonstrating a strong market potential and a clear path to commercialization.
We currently have close to €200 million in assets under management, with a total of 37 companies in our Portfolio, across three funds.
Let’s talk about numbers. Voima Ventures is turning 5 this year. Can you walk us through the investment deals you consider the most successful throughout those years?
Fund II:
- Kuva Space, €17 million seed round for hyperspectral nanosatellite constellation.
- Enifer Bio, over €15 million Series A for sidestream-based protein production
- Genomill Health, next gen liquid biopsy technology.
Fund I:
- Solar Foods, feeding HO2 to bacteria to generate novel food
- Infinited Fibre Company, 100% eternal fashion fibre from recycled clothes.Backed by top global fashion companies.
- Dispelix, the only independent waveguide player in the AR / VR space.
- Exits: Focalspec, Minima, and Paptic.
It’s almost a year since the launch of Fund III capped at €120 million. In terms of investment deals and received financing, how many of your plans have been achieved so far?
On average we review and assess approximately 800-1000 cases from the funnel on a yearly basis.
In March 2024, Sooma Medical announced its €5 million investment round where Voima was the lead investor. How did the deal come to happen and what can you tell us about the startup?
We met with the founding team back on summer 06/2023.
Sooma Medical is a spark of hope for the mental healthcare sector. They have pioneered an innovative solution that will change the lives of individuals battling depression and chronic pain. Founded on a mission of compassion and driven by a commitment to scientific rigour, Sooma’s groundbreaking therapies offer drug free, effective, and non-invasive alternatives to traditional treatments.
Through the use of neuromodulation, Sooma is alleviating symptoms and restoring hope and vitality to those with mental health challenges. Backed by research, Sooma is set to push the industry benchmarks of this healthcare sector North.
As we know, in September last year, you launched Velocity offering €1 million to science-oriented startups. N-ink managed to win the challenge. How did the challenge go and do you have any plans for “Velocity 2”?
The Velocity Challenge exceeded all our expectations, both in terms of the quality and quantity of applicants we received (83 to be exact!). The event garnered widespread positive feedback from co-investors within our network and sparked numerous fruitful discussions with finalists. While organizing an event of this scale required significant internal resources, it also generated an extraordinary amount of unique deal flow opportunities, we had finalists who were not on the radars of any of the other VC’s at the event.
This is validation that our deal flow strategy is on point and the relationships we have cultivated with Universities across our region are paying off. As a result, discussions about Velocity 2 have already commenced internally, with a tentative plan for a second round slated for an undecided date in 2025. This year, our focus remains razor-sharp: to seek out and support early-stage Nordic and Baltic companies poised to make meaningful contributions to society, the environment, or industry.
In our 2022 ranking, we included Voima Ventures as one of the most active funds in the Nordics and Baltics. You surely must know a thing or two about these markets. Can you comment a little about the current investment climate in the region.
Finland has laid a solid foundation for financing domestic startups through years of concerted effort, which has been crucial in light of the significant decrease in foreign capital. In response to the tightening market, startups have also taken proactive measures to enhance capital efficiency,
Jussi Sainiemi, Deputy Managing Partner of the venture capital firm Voima Ventures and Chair of FVCA’s Venture Capital Committee, comments.
Many investors are talking about tough times for the market in recent years. Did you experience any difficulties in 2022-2023 and how did you overcome them?
Looking back, we all know the numbers: there was a massive drop from the top years of venture capital investments from 21 to 23. The decrease in venture capital investment volume in the Nordics and Baltics — that’s our home turf — was close to 50%. So, the top year of 2021 was roughly €19 billion and the last year was only around €9 billion.
What does it mean? Firstly, one of the successes which we recently had was the first closing of Fund III. We were able to raise a fund above our initial target within really tough times. I think we managed to overcome the difficulties by building a unique positioning for Voima Ventures. In this challenging landscape, we are one of the very few science-centric investors with a proven track record from our Fund I and II. The team had grown from Finland to Sweden, so we’re really covering the Nordics and Baltics. And then we also did a very specific thesis-based investment strategy on three core areas we invest in: green transformation, exponential health solution, and game-changing platform technology.
In short, we managed to overcome such difficulties by doing very thorough work. Then let’s also remember that the work for Fund III had started already when we launched Fund II. So many of the new investors who came along were the LPs we started talking to five years ago. So it’s very long-term work.
Now, how did the fundraising difficulties affect our companies? So, the companies that have been in their later fundraising stages, Series A, B or C — anything from €5 to €10 million or above obviously struggled. So I don’t think any company had an easy time fundraising. And each of the more mature companies that have been in this phase, have been solving those problems very individually.
Some of them have been focusing more on customer traction, really driving revenues because investors really value revenues. Others may have been also, let’s say, cutting the burn in order to have just more runway to survive through the tougher times, particularly the ones who are in the R&D mode. And that’s obviously a smart thing to do. Thirdly, of course, the most successful companies were raising big rounds, but it just took them longer. So we’ve had a lot of value growth optics in our portfolio. And I think the good lesson learned for any entrepreneur is that even in tough times, you can raise big rounds if you are even more focused. And then, of course, we’ve had some companies that have gone belly up, particularly the ones that come from the Fund I, older vintage companies.
Sometimes it’s good to have these disruption points like COVID or this financial crisis, following the inflation and the war. As for us, we work with deep tech companies, with 90% of them having some actual concrete innovation, like a diagnostic kit or a factory to generate next generation protein, or a satellite for the next generation of surveillance. All these companies had to go through different challenges than, say, B2B and Travel tech companies. In that respect, our companies were better positioned for this financial crisis. They already knew how to cut burn and focus on customers, going straight ahead with this thesis that the companies need to have a 24 month runway. And that’s why we’ve done better.
Of course, the 100 million rounds have been non-existent in the Nordics. Only this quarter we’ve started to see a bit more of a positive development in the market. Time will tell how the whole market will evolve from this altogether.
Can you share any predictions about the close future of Startup and VC ecosystem in the CEE region and the Nordics? What should we expect?
Let’s remember these big megatrends are not disappearing anywhere:
- Firstly, we have a massive planetarian crisis. We will see different weather disruptions due to climate change, declining biodiversity, and things like that. But we are also seeing a massive shift, in the B2B side, from the industry to climate neutrality. This will create great opportunities for a lot of science-based and deep tech companies. However, it’s critical to get into scalability, as well as similar cost and pricing to existing solutions. The scalability is becoming really essential, and also the cost of capital.
- The other megatrend, of course, is exponential technology development: this competition between Asia, Europe, and the US, whether it’s AI or fundamental technologies like semiconductors, optics, photonics, etc. National interests are driving a lot of change in these matters. We see a lot of subsidies even within Europe for technology-intensive core technologies. Doubling down here on the single European market would be really critical. I think it will benefit everyone if we have more semiconductors, optics, photonics, and even dual-tech production in Europe.
Dual-tech, in particular, I think is the only silver lining of this war, if there’s any. Europe will start to invest more into dual-tech, which is a foundation of many consumer and B2B technologies we’re using today. And we shouldn’t shy away from that. We need to be independent in our defence technologies in Europe,
Inka Mero says.
- And then, on these other megatrends, which are now happening, like ageing population, urbanisation, and then, of course, the accelerating pace of the disruptions and the changes — offer a huge room for opportunities. The challenges that the European countries have are more systemic, relating to our innovation ecosystem or our demographics. But I think we have a really solid foundation on these opportunities.
Say, a startup is eager to raise fresh capital from Voima Ventures. What is the best advice you can give the founders?
When seeking funding from Voima Ventures, founders should focus on clearly articulating your startup’s value proposition and aligning it with our investment thesis.
- We back Nordic-Baltic deep tech startups who are building companies with a societal and environmental impact.
- While the technical complexity of your solution may be difficult to convey, it’s crucial to emphasise the scalability, potential impact, and your team’s expertise on the issue you are trying to solve instead of focusing on the granular details.
- Prepare a well-defined business plan, outlining your growth strategies, and demonstrate a solid grasp of your market and competitors.
- Highlight your commitment to innovation, sustainability or societal impact, and remain open to feedback throughout the process.
As specialists in deeptech investments, we bring extensive expertise in areas like cleantech, life sciences, advanced materials, quantum, and AI. This enables us to offer strategic guidance and valuable network connections tailored to startups in these sectors.
And, in conclusion, do you have any future plans you would like to share with our readers?
- We’re planning to expand our presence in Norway and Denmark, and continue to build our operations in Sweden through recruitment of a Life Sciences Investment Director.
- Double down on our efforts to connect with universities conducting cutting edge research into new technologies.
- Continue to advocate for greater boardroom diversity with our Annual Women to Board initiative, as well as fostering female representation in the STEM fields through proactive investments in female founded Science companies.
