Expon Capital and the new Digital Tech Fund

Capital V #8 | Building an onshore hub for Private Equity is a marathon, not a sprint

Jérôme Wittamer, Managing Partner of Expon Capital

Expon Capital was founded in June 2015, by Jérôme Wittamer, Alain Rodermann, Marc Gendebien and Rodrigo Sepúlveda Schulz. We spoke with Jérôme to learn more about this new venture.

Could you tell us your story? What triggered you to launch Expon Capital?

All of the four Founding Partners are digital natives: we first started playing with computers, calculators and games consoles in the late 70s and early 80s, then launched digital ventures in the 90s and 00s, and ended up investing in and supporting some of the most successful tech businesses built over the last 20 years (M-Systems invented the solid state memory you have in your phone/computer, LastMinute.com pioneered eCommerce in Europe, EVS powers slow motion replays for all sports broadcast on globally TV, Getaround democratised collaborative car-sharing…). At the same time, we also learned from investing in some less successful ventures (unclear business models, wrong market timing, harsh competition…). That’s why today, our experienced team shines through technology investing. What we are seeing now is a rapid, radical transformation of the world, through technology, and a trillion-euro opportunity in the process. Being so passionate about this, we couldn’t just sit there and watch. We want to be part of the change and help steer the future through our investment choices.

 

Other than digital transformation, do you identify more specific opportunities?

Of course. At the moment we are actively tracking specific innovations in Artificial Intelligence, Big Data, Blockchain, FinTech, Robotics, etc emerging from tech hubs in Europe, the US and Israel, but Expon Capital is much more than that.

Indeed, we believe that venture capital is also affected by this transformation and needs to evolve. You cannot just decide to focus on a specific opportunity as the whole economy is disrupted. We therefore launched our management company as a fully independent entity based on a new philosophy. Starting from a blank sheet of paper and armed with our lengthy experience, together with one of our strategic advisers, Salim Ismail (Global Ambassador at Singularity University and author of “Exponential Organizations”), we have developed a new approach to screening investment opportunities and boosting growth acceleration that we believe is more suited to capturing today’s market opportunities, based on our Exponential Framework. Any business that aims to impact a billion people will catch our attention!

You and your team were chosen to manage the Digital Tech Fund, a €20m seed fund investing in innovative digital start-ups based in Luxembourg. Can you tell us more about the Fund?

Firstly, the fund’s objective is to foster long-term innovation, and support the technology start-up ecosystem in Luxembourg. It also aims to facilitate the transfer of new digital technologies developed at the University of Luxembourg into successful spin-off companies. There is a financing gap in the market and while we won’t be able to fill it alone with this fund, we are confident that this will further raise the visibility and high quality of the opportunities we have in our country and improve the overall local financing landscape.

Secondly, the fund operates as any private venture fund, on the same exacting investment principles and market-driven governance with the aim of generating profit for the investors.

Is Expon Capital looking for specific things when you screen opportunities?

Expon Capital seeks and selects some of the most brilliant, ambitious entrepreneurs aiming to solve a tangible problem in a very large market. Specifically, for the Digital Tech Fund, these entrepreneurs must have also chosen to establish and grow their business from Luxembourg. Surprisingly, we meet people like this every week, coming from various backgrounds, very often originating from Europe. What we like businesses with a truly original service, with a very clear differentiation to the competition, such as with superior technology or user experience. We expect business acumen, sound unit economics, and great ambition from a team of visionaries.

What keeps you busy today?

Currently, we split our time between deal flow management (screening investment opportunities and meeting with entrepreneurs in Luxembourg and internationally) and fundraising for our Europe-focused Exponential Technologies Fund, Expon Capital Fund I. We also spend considerable time scrutinising technology developments and emerging trends.