Moonfire Ventures raises $115m to help ignite European AI start-ups

24 May 2023

The Moonfire Ventures team. Image: Moonfire Ventures

London’s Moonfire Ventures uses AI to inform its investment decisions. Its current portfolio includes AI start-ups such as Faculty and Flowrite.

London-headquartered VC firm Moonfire Ventures is hoping to support the next generation of Europe-based tech founders with the launch of its second fund.

“Europe has always been a leader in AI, and we believe our best contribution is to support the next generation of founders who are tackling some of our greatest challenges within health, work, finance, and gaming,” the firm said in a statement accompanying the fund’s launch.

The EU is due to formally vote on its wide-ranging AI Act next month. The legislation has been in the works for several years and includes provisions for companies using AI.

Moonfire was set up in 2020 by Atomico co-founder Mattias Ljungman. It launched its first fund a year later with a value of $60m.

Its portfolio includes Web3 chess company Immortal; mobile gaming company SkunkWorks; onboarding platform Humaans; automated payroll business Pento; and financial reporting company LiveFlow.

Its second fund is targeting start-ups and scale-ups, with a particular focus on those operating in the AI, machine learning and Web3 space, among others.

The firm said it takes an “AI-first approach” when it comes to discovering which companies to invest in. Its tech identifies promising founders and brings them to the VC teams’ attention.

“The result is a more inclusive venture capital, capable of discovering overlooked talent early, more frequently, and with greater accuracy,” the company said on its website.

The AI tech handles “the heavy-lifting” of sifting through start-ups while the VC team works on relationship building.

“Our approach is symbiotic,” the VC firm said. “AI assists us in making better decisions, faster, while we – the human investors and engineers – can continuously tune the AI, adapting to our actions, as well as shifting trends and market dynamics. It makes us more efficient investors, and able to foster deeper and more fruitful relationships with our founders.”

The statement pointed out that having people with tech knowledge on its team would be “an asset” for its founders.

“They have a partner who can help them navigate their complex technical challenges, from traditional areas like hiring and fundraising, to leveraging AI and machine learning.”

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Blathnaid O’Dea was a Careers reporter at Silicon Republic until 2024.