Eka Ventures closes $107m impact fund with backing from string of UK foundations

Eka Ventures has closed its second fund at $107m, becoming the UK's largest early-stage impact VC, according to the London-based firm.

LPs include the British Business Bank, Better Society Capital, Guy's & St Thomas' Foundation, The Health Foundation, WRAP, Esmée Fairbairn Foundation, John Ellerman Foundation, and The Vivensa Foundation.

Seventy percent of the commitments were follow-ons from the firm's first fund. The remainder was targeted at impact-focused foundations – a deliberate choice, says co-founding partner Camilla Dolan.

"The foundations we brought in have strong philosophical alignment with Eka and with our underlying portfolio companies," she tells Impact Loop. "The number of times we've introduced founders to them, and that's led to a really valuable relationship."

Eka's first fund performs in the top 5% of its peer group, according to data from Cambridge Associates and provided by the firm.

"We went back to our previous investors and they put a lot of trust in us," says Dolan. "It was exciting to showcase some of the positive results from our first fund."

Using AI to find deals

Eka, co-founded in 2018 by Dolan and Jon Coker, invests at pre-seed and seed across three themes: decarbonisation of major consumer industries, preventative and inclusive healthcare, and technology improving access to essential products and services.

Eka has a unique deal-sourcing methodology underpinned by a proprietary AI-powered system that ingests tens of thousands of companies each year and classifies them based on their alignment with the firm's investment thesis.

This is how Eka found Runna, the social fitness app acquired by Strava last year.

"They had 100+ rejections at Seed and we were the only fund to offer a term sheet," Dolan says.

Since it closed its first fund in 2021, almost half of its portfolio companies have been identified through this "in-house data platform".

"We don't solely rely on the technology platform to source and assess deals, but it's incredibly helpful in allowing us to punch above our weight in terms of spotting super early stage talent and talent that is beyond our immediate networks," Dolan says.

System-level investing

Eka applies a "system-level" approach to impact investing that looks at investments that maximise economic, environmental, and social outcomes.

Average cheque size is $2m, and Eka leads or co-leads 90% of its deals.The fund plans to back up to 30 companies in total, with capital reserved for follow-ons.

Fund I's portfolio include zero-emissions delivery company Hived, and Foresight Data Machines, which is applying AI to decarbonise the steel industry. Portfolio companies have gone on to raise from venture heavyweights including Index Ventures, Accel, and Balderton.

Six investments have already been made from fund two, with two more in closing, says Dolan. Three are in women's health, including Cyclana Bio, a Cambridge team developing diagnostics and new treatments for endometriosis, and Ditto Daily, which turns academic research into consumer health products.