The Icelandic New Business Venture Fund: Supporting Iceland's Growing Entrepreneurial Ecosystem

The Icelandic New Business Venture Fund is a vital component of Iceland's thriving entrepreneurial ecosystem. Launched in 2007, it has provided crucial support to numerous startups, helping them take their first steps towards success.

One of the fund's primary goals is to support innovative companies that have the potential to drive economic growth and job creation in Iceland. This is achieved through a combination of equity investments and other forms of support.

The Icelandic New Business Venture Fund has been actively investing in innovative startups. In the past year, the fund has made several notable investments.

One notable investment is MýSköpun, a company based in Iceland, which received $700K in seed funding in April 2023. This investment was part of a seed round.

The fund has also invested in HorseDay, another Icelandic startup, which also received $700K in seed funding in November 2022.

New Business Venture Fund has been actively investing in various companies across different locations. The fund has invested in a total of 5 companies.

The fund's investments range from Seed to Series A rounds, indicating its willingness to support companies at different stages of growth. Seed rounds are typically for early-stage companies, while Series A rounds are for more established companies looking to scale.

Some of the companies that have received funding from New Business Venture Fund are MýSköpun and HorseDay, both of which are based in Iceland and received $700K in Seed funding.

The fund has also invested in companies based in the United States, such as PayAnalytics, which received $3.4M in Series A funding.

One of the notable investments made in the recent past was in the field of renewable energy, with a focus on solar power. The company invested $50 million in a solar panel manufacturing facility in Arizona.

Another notable investment was in a cutting-edge water treatment technology that uses artificial intelligence to detect and remove pollutants from water sources. This technology has the potential to provide clean drinking water to millions of people worldwide.

The company also invested in a sustainable agriculture project that aims to reduce food waste and increase crop yields using advanced hydroponics and vertical farming techniques. This project has already shown promising results with a 30% increase in crop yields.

A notable investment in the tech sector was in a company that specializes in developing AI-powered cybersecurity solutions. This investment has helped to strengthen the company's position in the market and provide more effective protection against cyber threats.

The company's investment in a clean tech startup that developed a revolutionary new material for carbon capture has the potential to significantly reduce greenhouse gas emissions. This material has already shown promising results in pilot projects around the world.

The New Business Venture Fund operates as an evergreen investment fund, meaning it's sustainable and can continue to make new investments.

The fund is established to strengthen and develop the Icelandic venture capital market, while also promoting startups and businesses in Iceland.

The investment range of the New Business Venture Fund can go up to €5M, providing a significant amount of funding for startups and businesses.

Nýsköpunarsjóður, the Icelandic name for the New Business Venture Fund, has a dedicated mentorship panel for its portfolio companies, offering guidance and support throughout the early stages.

The fund's investments are intended to spur growth, support technical developments, and contribute to the general development of Iceland's startup ecosystem.

Angel investors play a significant role in Iceland's startup ecosystem, often funding projects that align with their own interests and vision.

Angel investors in Iceland may act individually or as a syndicate, making networks the best opportunity to find a potential angel investor with aligned interests.

Iceland's venture capital landscape has grown significantly since 2015, with established VC firms like Frumtak Ventures and Crowberry Capital leading the way in Reykjavík.

The startup environment benefits from Iceland's high technology adoption rate and strong innovation infrastructure, particularly in sectors like clean energy, biotechnology, and digital solutions.

Frumtak Ventures is a prominent VC firm based in Reykjavik, founded in 2008. They focus on early-stage investments in innovative companies.

Their rigorous screening process evaluates the team, market potential, scalability, and competitive advantage. Frumtak Ventures invests around €3M.

The firm's mission is to invest in teams and ideas that solve real-world problems, reinforcing Iceland's reputation for profitable innovation. They primarily invest locally, supporting various sectors and entrepreneurs.

Frumtak Ventures has a comprehensive investment process, actively participating in the strategic development of their portfolio companies. They have made notable investments in companies like Data Dwell, Meniga, and Kaptio.

Here are some key statistics about Frumtak Ventures:

Angel investors in Iceland can be found through networks, where they often act as individuals or syndicates to fund projects that align with their interests and vision.

Icelandic angel investors often have a strong preference for startups that share their vision and interests.

Brunnur Ventures is an active VC firm in Iceland that has been funding startups for over a decade, investing in a wide range of sectors with a focus on low-competition businesses.

They typically prioritize startups led by experienced leaders with at least 5 years of experience and are at the seed stage, with an investment range of €2M to €13M.

Notable investments by Brunnur Ventures include Grid and Oculis.

Icelandic investors show a strong preference for sectors aligned with the country's strengths, including green technology, marine technology, gaming/entertainment software, health tech, and sustainable food production.

There's also growing interest in fintech and blockchain technology, leveraging Iceland's strong financial services infrastructure and cryptocurrency mining presence.

Brunnur Ventures organizes several pitching competitions each year, funding around 3-5 companies annually.

Iceland's venture capital landscape has grown significantly since 2015, centered primarily in Reykjavík. The country's high technology adoption rate and strong innovation infrastructure make it an attractive place for startups to thrive.

Established VC firms like Frumtak Ventures and Crowberry Capital are at the forefront of this growth. Frumtak Ventures, founded in 2008, focuses on early-stage investments in innovative companies, with an investment range of around €3M. They look for teams and ideas that solve real-world problems, reinforcing Iceland's reputation for profitable innovation.

The New Business Venture Fund was established to strengthen and develop the Icelandic venture capital market, with an investment range of up to €5M. This evergreen investment fund supports ongoing operations and new investments, with a dedicated mentorship panel guiding portfolio companies through the early stages.

Icelandic VCs typically look for companies with clear intellectual property rights, strong market potential beyond Iceland, and experienced founding teams. Standard terms include board representation, anti-dilution protection, and preference shares, which can be a bit complex for startups to navigate.

To give you a better idea of the Icelandic VC landscape, here are some key statistics:

SNÖ Ventures also plays a significant role in the ecosystem, aiming to enhance the Nordic ecosystem by facilitating the sharing of resources, talent, ideas, and experience throughout the region.

Icelandic investors have a strong affinity for sectors that leverage the country's unique strengths.

Green technology, particularly geothermal solutions, is a top investment priority for Icelandic VCs and angels.

Marine technology is another area of interest, likely due to Iceland's proximity to the ocean and existing expertise in this field.

The gaming/entertainment software sector is also popular among Icelandic investors, who may be drawn to the country's existing gaming industry and creative talent.

Health tech is a growing area of investment, which could be attributed to the country's strong healthcare system and innovative spirit.

Sustainable food production is another sector that Icelandic investors are backing, possibly due to the country's emphasis on eco-friendly practices and its reputation for fresh, high-quality produce.

Fintech and blockchain technology are also gaining traction, with Icelandic investors leveraging the country's strong financial services infrastructure and cryptocurrency mining presence.

Icelandic VCs typically look for companies with clear intellectual property rights.

Standard terms for Icelandic VCs include board representation.

Anti-dilution protection is also a standard term.

Preference shares are often used by Icelandic VCs.

Most VCs expect startups to have an established presence in Iceland.

Some VCs are open to remote teams with significant Icelandic operations.

Documentation in both Icelandic and English is often required.