Mundi Ventures just closed €750 million for Kembara Fund I, marking one of Europe's largest deep tech and climate funds to date. The Spain-based firm is tackling what co-founder Yann de Vries calls Europe's "scale-up problem" - the capital drought that kills promising startups between Series B and global expansion. With backing from the European Investment Fund and a potential final close at €1.25 billion, Kembara is betting big that European deep tech doesn't need more ideas - it needs growth capital to compete.
Europe's deep tech ecosystem has a painful pattern: brilliant university spinouts raise early-stage capital, build revolutionary technology, then hit a wall when it's time to scale. Mundi Ventures just put €750 million on the table to break that cycle.
The Spain-based firm announced the first close of Kembara Fund I, its fifth and largest fund focused squarely on Series B and C rounds for deep tech and climate companies. According to regulatory filings in Spain, the fund could stretch to €1.25 billion at final close - a war chest aimed directly at what co-founder Yann de Vries calls Europe's "scale-up problem."
"Europe doesn't have an innovation problem. It doesn't have a startup problem. The problem it has is a scale-up problem," de Vries told TechCrunch. He should know - the former Atomico partner lived through the nightmare scenario as an executive at Lilium, the German electric aircraft startup that ceased operations in 2024 after raising over $1 billion.
That "traumatizing experience" crystallized Kembara's thesis. The fund plans to write initial checks between €15 million and €40 million into roughly 20 companies, with follow-on capacity reaching €100 million per portfolio company. That's more than the entire size of many European funds, though the landscape is shifting - deep tech firm Elaia partnered with Lazard to form LEC with similar check sizes, while Plural is reportedly raising up to €1 billion.
Kembara secured a crucial €350 million anchor commitment from the European Investment Fund in 2024 under the European Tech Champions Initiative. But getting to €750 million in two years "was not easy," de Vries admitted. The fund operates as a specialist team within Mundi Ventures, with offices spanning Madrid, London, Barcelona, and Paris.
The general partner lineup reads like a European deep tech all-star team. Alongside de Vries and Mundi Ventures founder Javier Santiso, the fund brought on climate tech VC Robert Trezona and deep tech VC Pierre Festal as GPs, plus former Atomico partner Siraj Khaliq as senior strategic advisor. Their combined track records opened doors with institutional backers finally waking up to Europe's growth capital crisis.
But Kembara isn't just writing bigger checks. The team is "productizing non-dilutive financing" for deep tech founders - a direct response to watching capital-intensive startups drown in equity rounds. "What we want to do now is help them de-risk their future financing and optimize the capital structure to minimize dilution," de Vries explained. Limited partners are being recruited not just to invest in the fund, but to co-invest in winners with venture debt and alternative financing structures.
Geopolitics is accelerating the urgency. Kembara's sector focus explicitly includes dual-use and defense tech to "protect European sovereignty" - a phrase appearing more frequently in European VC pitches. The fund targets quantum computing, semiconductors, and spacetech, all areas where keeping champions European has become a strategic imperative.
De Vries referenced DeepMind as a cautionary tale of what happens without growth capital. Google acquired the London-based AI lab for more than $500 million in 2014, but it's now estimated to be worth billions. "There are lots of gems that are under the radar in Europe, that could be scaling into global champions, and that are not realizing their full potential," he said.
The fund's name - Kembara, meaning "to wander" in Malaysian - hints at global ambitions beyond European borders. Santiso previously served as CEO for Europe at Malaysian sovereign wealth fund Khazanah, and those connections could prove valuable as countries reassess their U.S. exposure. "In the second close, we're going to be looking for global investors, because we want to have global access to markets, but also global access to supply chain," de Vries said.
European sovereign wealth funds, governments, and corporations are lining up to back the thesis. A recent report highlighted how Europe invests billions into early-stage climate startups only to watch them fail at Series B - exactly the gap Kembara is designed to fill. "There's going to be a lot of support from sovereign wealth funds in Europe, from government, from corporations, to push and drive for building these European champions in deep tech out of Europe," de Vries predicted.
The fund's structure reflects hard-won lessons from the capital-intensive trenches. Even large VC checks only go so far when you're scaling advanced manufacturing or building semiconductor fabs. Kembara's limited partners understand they're not just backing a fund - they're backing an infrastructure play to keep European innovation in European hands.
Whether €750 million - or even €1.25 billion - is enough to solve Europe's scale-up crisis remains to be seen. But for the first time, European deep tech founders have a credible answer when asked where their Series B will come from. And for a continent that's watched too many breakthrough technologies get acquired before reaching their potential, that's a start.
Kembara Fund I represents a strategic bet that Europe's deep tech problem isn't about innovation - it's about capital structures and scale. With €750 million already closed and potential to reach €1.25 billion, Mundi Ventures is assembling the kind of growth capital that could actually turn university spinouts into global champions. The fund's focus on non-dilutive financing and follow-on capacity up to €100 million per company addresses the structural issues that killed companies like Lilium. As geopolitical tensions make European sovereignty in quantum computing, semiconductors, and defense tech increasingly urgent, Kembara's timing couldn't be better. The question now isn't whether Europe can innovate - it's whether funds like this can finally help those innovations scale before they get acquired by Silicon Valley or Asia.
