Atomico aims $476 million fund at tech start-ups outside Silicon Valley

Atomico CEO Niklas Zennstrom attends the eG8 forum in Paris May 25, 2011. REUTERS/Gonzalo Fuentes

By Mia Shanley

(Reuters) - Atomico, a European venture capital firm that has invested in the likes of Angry Birds developer Rovio, plans to spend its new $476 million fund on technology start-ups outside Silicon Valley, it said on Tuesday.

While the United States has long dominated venture capital investments in technology, investors have been increasingly drawn to opportunities in Asia and Europe, especially in areas such as e-commerce and gaming.

"Ten years ago people thought you had to be in Silicon Valley to build a global technology business. That is no longer the case," said Atomico founder Niklas Zennstrom, a Swedish entrepreneur who co-founded Skype, a web phone service which was sold to Microsoft Corp for $8.5 billion in 2011.

"We see entrepreneurs from all over the world achieving global success faster than ever before and across every sector of the global economy. Our new fund is aimed squarely at this opportunity," he said.

Reuters reported last week that London-based Atomico had wrapped up its third fund, citing a document filed with the U.S. Securities & Exchange Commission.

The venture capital firm said on Tuesday the fund, three times the size of its previous in 2010, would be dedicated to helping entrepreneurs outside Silicon Valley scale their businesses globally.

Asked which sectors the money could be spent on, Mattias Ljungman, an Atomico partner who also sits on the board of Finnish mobile game maker Supercell, pointed to a current portfolio of investments which includes online games, payments, travel and e-commerce services.

"This is what's so exciting. What we're seeing now is the transformation of the old economy into the new economy, which is a digitized economy," he said, adding that there were a lot of interesting opportunities in the mobile phone space.

He said Atomico would stay focused on big markets where it is present such as Europe, China, Japan, Brazil, Turkey and South Korea.

"But that's by no means exclusive," he added. "We want to work with outstanding entrepreneurs wherever they are."

The firm said the fund was oversubscribed and had broad backing from investors in Asia, the United States and Europe.

According to Thomson Reuters data, venture capital firms have made $35.7 billion in tech investments so far this year, with the United States taking up the lion's share at almost 60 percent followed by Asia at 31 percent and Europe at 9 percent.

Atomico, which is seven years old, has made more than 50 investments including Jawbone, maker of the Up fitness tracker, and Swedish payments service Klarna.

Supercell, one of its earlier investments, was recently given a $3 billion valuation after Japan's SoftBank snapped up a 51 percent stake in the three-year-old firm.

(Reporting by Mia Shanley in Stockholm; Editing by Pravin Char and David Evans)

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