Kompas VC closes Fund II to lead early-stage rounds in a fragmented world
Kompas VC, a European venture capital firm focused on the physical economy, has closed its second fund with a check size range of €3 million to €5 million, positioning itself as a lead investor in early-stage European startups targeting decarbonization, productivity, and risk management. The fund close, reported exclusively by TechCrunch, underscores a deliberate strategy to capitalize on deglobalization trends reshaping the global economy into three dominant blocs.
Fund size and check strategy: Kompas VC targets early conviction capital
A deliberate first-check mandate
Kompas VC's Fund II is sized to lead early-stage rounds rather than participate as a follower. With checks between €3 million and €5 million, the firm occupies a deliberate position at the earliest stages of company formation — a segment where founder relationships and sectoral conviction matter more than balance sheet firepower.
While the fund is smaller than many of today's large venture vehicles, Kompas views this as a structural advantage rather than a limitation. The firm argues that concentrated capital, deployed with thematic precision, generates stronger deal access and founder alignment than generalist mega-funds competing across dozens of verticals simultaneously.
The case for specialized, smaller funds
"I think there's a great space for highly focused, highly specialized, smaller funds like ours to be the first check-in and sweep up certain themes and certain founders," said Sebastian Peck, partner at Kompas VC, in an interview with TechCrunch.
Peck's thesis reflects a broader debate in European venture capital about the optimal fund size for early-stage investing. As multi-billion-euro vehicles from pan-European and transatlantic firms compete for later-stage deals, the pre-seed and seed landscape remains less crowded for managers with genuine sector depth. Kompas positions itself squarely in that white space.
Three-bloc world: the macro thesis behind Kompas VC's deglobalization investing strategy
Deglobalization as a venture catalyst
"We see the world really falling into three main spheres of economic activity, of political activity — the U.S., Europe, and China," Peck told TechCrunch. This tripartite fragmentation thesis, which gained significant traction after 2021, forms the intellectual backbone of Kompas's investment strategy.
The post-pandemic unwinding of just-in-time global supply chains, accelerated by geopolitical disruptions including the Russia-Ukraine conflict and U.S.-China trade tensions, has prompted corporations across manufacturing, energy, and logistics to restructure their operations regionally. This nearshoring and friend-shoring dynamic is creating durable, policy-supported demand for startups that help physical-economy incumbents adapt — precisely the companies Kompas targets.
Europe's strategic advantage in the physical economy
Europe occupies a particularly advantageous position within this three-bloc framework. The continent combines a deep industrial base, a regulatory environment that actively mandates decarbonization, and a growing cohort of deep-tech founders emerging from world-class engineering universities. As a European fund, Kompas benefits from direct access to this founder pool — a structural edge that transatlantic or Asia-focused funds cannot easily replicate.
Peck emphasized that Kompas's European base is not merely a geographic label but a genuine sourcing advantage. The firm's network within regional industrial clusters and research institutions allows it to identify capital-efficient startups before they enter broader venture market awareness.
Sector focus: decarbonization startups, productivity, and risk management
Decarbonization: industrial climate tech as regulatory tailwind
Industrial decarbonization represents Kompas's most structurally supported vertical. The European Union's Green Deal, the Carbon Border Adjustment Mechanism (CBAM), and binding emissions reduction targets create mandatory compliance pressure on manufacturers — translating directly into procurement budgets for climate technology startups. Kompas targets companies developing solutions across energy transition, industrial emissions reduction, and sustainable materials within this regulatory framework.
Productivity and risk management in the physical world
Beyond decarbonization, Kompas is actively deploying into startups digitizing supply chains, automating physical production processes, and building risk-management tooling for goods producers. In a fragmented geopolitical environment, manufacturers face heightened exposure to supply disruption, input price volatility, and compliance complexity across multiple regulatory jurisdictions. Early-stage software and hardware companies addressing these pain points represent scalable venture opportunities with defensible moats — particularly when backed by a specialist investor capable of providing strategic context alongside capital.
"Our focus is in the physical world, anything around producing physical goods," Peck confirmed, describing the three verticals — decarbonization, productivity, and risk management — as mutually reinforcing themes within the firm's broader fragmented-world thesis.
This article is intended for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any financial instrument. Investors should conduct their own due diligence before making any investment decisions.