Episode 134 · 2022-04-25 · 46:09 · Original in Finnish
Venture Capital in Germany and Japan | Oskari Lehtonen and Claes Mikko Nilsen | Negotiator 134
Originally published as “VC Saksassa ja Japanissa | Oskari Lehtonen Claes Mikko Nilsen | Neuvottelija 134”
Oskari Lehtonen of Redstone VC and Claes Mikko Nilsen of Nordic Ninja VC explain how a venture capital model changes when the money behind it comes from a German family business rather than from a Japanese industrial group. Nilsen explains why Panasonic, Honda, Omron and Japan's state bank decided to channel a hundred million euros into the Nordics and the Baltics, and why the fund's complete independence was a condition of the whole undertaking. The conversation covers LP and GP structures, exit channels, and why European funds nearly always include public money while American ones never do.
Core theses
- Who the limited partners are changes what the fund can do, which is the episode's argument that capital is not fungible in practice.
- The Japanese industrial backers required the fund to be independent of them — the strategic value depends on the fund not being steered.
- European venture nearly always includes public money and American venture never does, and that single difference explains much of the divergence in behaviour.
- The exit channel available at the end is what actually determines what a fund can buy at the beginning.
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Summary
Oskari Lehtonen of Redstone VC and Claes Mikko Nilsen of Nordic Ninja VC explain how a venture capital model changes when the money behind it comes from a German family business rather than from a Japanese industrial group. Nilsen explains why Panasonic, Honda, Omron and Japan’s state bank decided to channel a hundred million euros into the Nordics and the Baltics, and why the fund’s complete independence was a condition of the whole undertaking. The conversation covers LP and GP structures, exit channels, and why European funds nearly always include public money while American ones never do.
Capital is not interchangeable
The premise worth taking away is that a euro from a German family business and a euro from a Japanese industrial group buy different behaviour from the same fund. Patience, sector preference, tolerance for a slow exit and appetite for follow-on all track the source, which makes the LP base a strategic choice rather than a funding detail.
Independence as a condition
The counter-intuitive part of the Nordic Ninja arrangement is that the industrial backers insisted the fund be independent of them. A corporate venture arm that invests to serve its parent sees a narrower deal flow; the strategic value they wanted required giving up the steering.
Public money on one continent only
European funds are built with a public participant almost as a matter of course, and American ones are not. That difference propagates all the way to risk appetite and time horizon, and it explains more about the two ecosystems than the usual comparisons of deal size do.
Watch
The recording lives on the Neuvottelija channel: VC Saksassa ja Japanissa | Oskari Lehtonen Claes Mikko Nilsen | Neuvottelija 134. A Finnish edition of this episode is published at www.neuvottelija.fi.
In depth
The Neuvottelija AI editions carry a long-form write-up of this episode: English · suomeksi.
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People and topics
Guests: Oskari Lehtonen, Claes Mikko Nilsen