EU’s €5 Billion Technology Fund Makes First Move with Investment in Iceye
The newly established €5 billion (US$5.8 billion) technology fund in Europe has announced its inaugural investment in Finnish satellite innovator Iceye Oy, marking a significant step in the bloc’s initiative to foster startups engaged in strategic technological advancements.
Managed by the Swedish investment firm EQT AB, the European Union’s (EU) Scaleup Europe Fund co-led Iceye’s funding round in June, partnering with the U.S.-based investor General Atlantic.
Victor Englesson, a partner at EQT and co-head of the fund, elaborated on this development in a recent interview.
Iceye successfully secured €1 billion from a range of new investors, integrating both fresh investments and a secondary placement, in a round that valued the innovative enterprise at over €10 billion.
According to sources familiar with the matter, the Scaleup Europe Fund contributed €300 million, engaging in both primary and secondary financing efforts. However, EQT and Iceye have refrained from disclosing specific investor amounts.
Emerging as part of a burgeoning cadre of European space technology firms, Iceye rose to prominence following Russia’s incursion into Ukraine.
This geopolitical shift prompted European nations to escalate their investments in more responsive and agile space-based intelligence and communications frameworks.
The decision to invest in Iceye—known for its advanced surveillance satellites—was made to align with the EU’s broader objective of reducing dependence on American technology solutions.
Looking ahead, Iceye’s chief executive officer, Rafa Modrzewski, expressed hopes of a future stock market listing in Europe. “Iceye possesses considerable optionality, both in private and public arenas,” remarked Englesson.
The EU began dialogue with potential investors for its Scaleup Europe Fund last year, aiming to support startups specializing in quantum computing, artificial intelligence (AI), and other deep tech sectors.
EQT was entrusted with the management of the fund in May, concentrating on private startups beyond Series B funding rounds.
The continent has grappled with retaining its most promising technology firms, often witnessing them being sold to foreign entities or relocating to the United States.
For instance, Advanced Micro Devices Inc is set to acquire Finnish AI lab Silo AI for US$665 million in 2024, while Apple recently bought the Danish machine-learning company Spektral.
Heightened conflict in the Middle East has further illuminated the critical importance of national space assets, prompting governments to expedite plans for establishing or securing access to their own satellite constellations, amid concerns that reliance on external providers may jeopardize vital data and communications during crises.
Source link: Thestar.com.my.
