Frontline Ventures, based in Dublin and London, has announced a new $80 million fund designed to assist U.S. tech companies expanding into Europe.
The new Frontline X fund — which means the firm now has $200 million under management — focuses mainly on growth-stage B2B companies and invests up to $5 million per company alongside lead investors in later-stage rounds. Frontline X will be led by partners Stephen McIntyre and Brennan O’Donnell.
The firm believes that flawed go-to-market strategies and weak local talent networks means that U.S. companies tend to lose too much money in foregone revenue when they expand into Europe, and the team is aiming to address this.
Ireland has been a crucial landing point, particularly for U.S. tech companies expanding into Europe, in part because of its low tax regime. No doubt, Irish investors are now realizing that with the U.K. leaving the EU, both Dublin and Ireland will become an even more attractive proposition.
Frontline has backed a number of successful companies in Seed Funds I and II, including Britebill (acquired by Amdocs), Logentries (acquired by Rapid7) and Orchestrate (acquired by CenturyLink). Most recently, Frontline was an early investor in Pointy, which was acquired by Google last month.
Prior to joining Frontline, McIntyre setup Twitter’s European headquarters as the vice president of EMEA, and built its EMEA business. Prior to that he ran a substantial part of Google’s ads business.
O’Donnell joins Frontline X as a partner in San Francisco. He previously held multiple go-to-market leadership roles at Google in the U.S. and Europe and executive roles at Yammer, SurveyMonkey, Euclid and Airtable.
In a statement McIntyre said: “We’ve benchmarked the best of B2B software and seen that, by the time a company goes public, 30% of its revenue should be coming from Europe. But even the biggest names in tech fail to get there because of avoidable mistakes when they land. We’ve learned about international expansion the hard way as operators. The good news is that most of these problems are known and solvable.”
Frontline X already invested in the Series B of TripActions, a company that has gone on to raise from Andreessen Horowitz at a $4 billion valuation; People.ai’s $100 million Series C, together with Lightspeed, Andreessen Horowitz and ICONIQ; and Clearbanc’s $50 million Series B, with Emergence and Highland. The VC has also backed more than 60 companies with recent investments, including TeachCloud, Siren, Cloudsmith and Sweepr.
Ariel Cohen, the CEO of TripActions, commented that Frontline was “a crucial source of go-to-market advice.”