Endeavor announces the final closing of Endeavor Catalyst Fund IV, a $292 million venture capital fund through which it plans to continue to invest in the companies led by Endeavor Entrepreneurs globally. The closing of Endeavor Catalyst Fund IV represents Endeavor’s largest fund to date, surpassing the fund’s initial $200 million to $250 million target. It also brings Endeavor Catalyst’s total assets under management (AUM) to more than $500 million.
"The quality of entrepreneurial talent today across the 40-plus markets where Endeavor operates is the highest we’ve ever seen, and we can’t wait to invest more in these places,” said Allen Taylor, managing partner, Endeavor Catalyst.
A fund of, by and for entrepreneurs
The community of Limited Partners (LPs) behind Endeavor Catalyst IV includes iconic founders such as Reid Hoffman (LinkedIn), Marcin Żukowski (Snowflake) and Kevin Ryan (DoubleClick, MongoDB), as well as more than 100 of Endeavor’s own entrepreneurs. In fact, Endeavor Entrepreneurs account for more than 30% of the LPs for this fund, a high in Endeavor Catalyst’s 10-year history and a testament to the way in which Endeavor Catalyst has become a powerful platform for Endeavor Entrepreneurs to reinvest their success in their peers.
As Mudassir Sheikha, CEO of Careem (acquired by Uber for $3.1 billion) sees it, investing in Endeavor Catalyst is a, “great way to pay it forward and invest in high-quality entrepreneurs in emerging markets.”
Outsized belief in emerging markets, outsized returns
Established in 2012, Endeavor Catalyst has demonstrated over the past decade that betting on emerging market entrepreneurs works. So far, 49 investees of Endeavor Catalyst funds have reached the billion dollar mark in valuation, including several IPOs and acquisitions. This means almost one out of five of the investees have reached unicorn status, ranking Endeavor Catalyst among the top five most prolific unicorn investors in the geographies where Endeavor operates, according to data from CB Insights.
As of today, Endeavor Catalyst has made more than 260 investments in more than 35 different markets across Latin America, the Middle East, Africa and Southeast Asia, as well as underserved places in Europe and the U.S. Collectively, these companies have created nearly 2 million jobs and generated $17 billion in revenue in 2021. The Endeavor Catalyst funds are designed as rules-based, co-investment funds that invest exclusively in companies led by Endeavor Entrepreneurs raising priced equity rounds from venture capital and growth equity funds, primarily at Series A, B and C. Among its portfolio, the most common investments are in the fintech (26%), retail and consumer tech (23%) and enterprise software and services (18%) sectors.
A self-sustaining business model
As with previous funds, the carried interest earned on Endeavor Catalyst IV’s investments will be used to fund Endeavor’s future sustainability, fueling its mission to support more high-impact entrepreneurs in emerging and underserved markets. This key characteristic has drawn a diverse set of investors who believe their investment will generate a competitive financial return and continue to support the next generation of entrepreneurs. For Endeavor’s cofounder and CEO, Linda Rottenberg, it is this self-sustaining, long-term business model for Endeavor that is most exciting.
“Endeavor will celebrate our 25-year anniversary later this year,” Rottenberg said, “and I couldn’t be more proud of all of the amazing entrepreneurs we support, and our 500-plus person team around the world. But for our own business model, I am most proud of the fact that Endeavor Catalyst has put us on a path to make Endeavor self-sustaining over the next decade.”
What’s next?
With this fourth fund, Endeavor Catalyst will continue to co-invest alongside professional venture capital and growth equity firms into companies selected into the Endeavor network. Following an initial close earlier this year, Endeavor Catalyst has already made investments out of this fund alongside a16z, General Atlantic, Insight Partners, Lightspeed and Softbank, among others.
“We’re off to a great start with Fund IV,” said Taylor, noting that the current fundraising environment does not change anything about the fund’s core thesis. “We believe talent is everywhere, and we are building this for the very long-term. With Fund IV, we continue to double down on the markets that have been most active for us over the past few years – Brazil, Mexico, Indonesia – and are excited about the opportunity to invest in new Endeavor markets such as Pakistan.”
With venture capital developing as an asset class in emerging markets throughout Latin America, Europe and Southeast Asia, and more VC dollars flowing to Africa and the Middle East than at any point in history, Endeavor Catalyst is excited to continue partnering with Endeavor Entrepreneurs across all these regions. Locally, Endeavor Catalyst has invested in companies like SkuVault (Louisville, Kentucky), LISNR (Cincinnati, Ohio) and AppHarvest (Lexington, Kentucky).
Disclaimers: The information in this material is only current as of June 30, 2022, and may be superseded by sub-sequent market events or for other reasons. Statements concerning financial market trends are based on current market conditions, which will fluctuate. Past performance mentioned herein is not a guarantee of future results. Investors should not assume that an investment in any fund or company identified was or will be profitable. The information herein is not an offer to sell or a solicitation of an offer to buy an interest in any investment fund or the provision of any investment management or advisory services. Endeavor and Endeavor Catalyst do not offer legal, accounting or tax advice.
