At the turn of the year, Danske Bank Group took over the management of the first three Dansk Vækstkapital funds from the state-owned Export and Investment Fund of Denmark (EIFO) and has now launched Dansk Vækstkapital IV.

“We are very proud to be opening a new chapter in the story of the Dansk Vækstkapital funds. The previous three funds have played a unique role in the Danish and Nordic business communities, constituting a key component of the start-up and growth company ecosystem for several years while at the same time delivering strong returns for investors,” says Casper Bruyant Bonde, Head of Illiquid Alternatives at Danske Bank Asset Management and CEO of Danske Private Equity, a part of the Danske Bank Group that manages the Dansk Vækstkapital funds.

Dansk Vækstkapital IV will consist of three fund modules which, overall, will give exposure to a broad portfolio of unlisted start-up and growth companies at different stages of their development. Like the previous Dansk Vækstkapital funds, the fund modules of Dansk Vækstkapital IV will focus on investments in the Nordic region, particularly Denmark.

“Geographically, it is an attractive investment area that is very much focused on innovation and technological development, while companies in the Nordic region benefit from a highly educated workforce and political and regulatory stability,” says Casper Bruyant Bonde.

Focus on future growth in Europe
Dansk Vækstkapital IV aligns well with Danske Bank’s strategic purpose of creating financial solutions and opportunities that unlock the potential in people and businesses.

Kent Due-Frederiksen, Head of Danske Growth – Danske Bank’s department for start-up and growth companies – explains:

“The entrepreneurship ecosystem is a key focus area for us at Danske Bank. As the need for innovation and investment in the future growth of Europe has attracted increasing attention, we have helped several thousand growth companies in recent years by providing capital, infrastructure and advice. With the launch of Dansk Vækstkapital IV, we can contribute to further improving growth conditions for start-up and growth enterprises and thus benefit business and society. Additionally, we are also helping facilitate investment opportunities in a very attractive segment of the Danish and Nordic business communities,” says Kent Due-Frederiksen.

A key component of the food chain for the start-up and growth ecosystem
The three fund modules in Dansk Vækstkapital IV provide exposure to start-up and growth companies through investments in venture funds, buyout funds and co-investments, which are investments in carefully selected individual companies alongside venture and buyout funds. Whereas venture funds invest in portfolios of start-up companies, buyout funds invest in more well-established companies with the potential for further growth.

The new Dansk Vækstkapital IV fund is positively received by Aktive Ejere (Active Owners), the trade association that counts venture and buyout funds among its membership in Denmark.

“Historically, the Dansk Vækstkapital funds have comprised an essential element of the food chain in terms of channelling venture capital to the Danish start-up and growth ecosystem, so the launch of Dansk Vækstkapital IV is a very significant event. Venture capital is one of the cornerstones for ensuring the continued development of successful new enterprises in the Danish business community that will secure future employment. While Denmark has an aptitude for innovation and entrepreneurship, the support of investors for funds like Dansk Vækstkapital IV is also required,” says Christian Frigast, board chairman at Aktive Ejere.

Experienced team of portfolio managers
Individual investments in Dansk Vækstkapital IV’s three fund modules will be selected by an experienced team of portfolio managers headed by Søren Melholdt Rasmussen and Ole Hauskov. Both have many years’ experience with the asset class and have delivered strong results on previous Dansk Vækstkapital funds. Both principal portfolio managers switched from EIFO to the Danske Bank Group along with the Dansk Vækstkapital funds.

Initially, however, the main focus is on raising capital for Dansk Vækstkapital IV.

“We have high ambitions for Dansk Vækstkapital IV and expect to surpass the previous fund – Dansk Vækstkapital III – which raised close to DKK 2.4bn from investors. Provisional interest from institutional investors in particular has been substantial, so the outlook is promising,” says Casper Bruyant Bonde.

Direct investments in Dansk Vækstkapital IV’s three fund modules are restricted to institutional and professional investors with the tripartite fund structure enabling investors to obtain targeted exposure to either venture funds, buyout funds or any desired combination. Select Danske Bank Private Banking customers can gain exposure to the three fund modules if they meet certain criteria.

An investment in the Dansk Vækstkapital IV fund modules can be categorised as an investment with high risk and very limited liquidity, and an investment requires a long-term horizon.