IFC Investment in Poland`s Cogito to Boost Technology Startups in Central and Eastern Europe

• IFC is investing up to €15 million in Cogito Fund II to support early-stage tech companies in Central and Eastern Europe.
  
• The €125 million fund will focus on Series A and B companies, boosting innovation in sectors like fintech and climate-tech.

Warsaw, Poland, November 12, 2024—To support innovative startups and technology-enabled ventures across Central and Eastern Europe (CEE), IFC has committed an equity investment of up to €15 million in Cogito Fund II (the Fund). This investment aims to help early-growth stage technology companies access the capital and resources necessary to develop and scale new technology solutions, thereby creating jobs and enhancing the region's innovation capabilities.

 Managed by Cogito Capital Partners, based in Poland, the Fund will primarily invest in Series A+ technology companies that provide software-based enterprise solutions, encompassing process automation, data analytics, upskilling, fintech, health-tech, and selectively, climate-tech.

The Fund, focusing on Poland and other CEE countries, including the Czech Republic, Slovakia, Hungary, Romania, and the Baltic states, has a target size of €125 million and serves as the successor to Cogito Fund I, a 2019 vintage fund with €61.3 million in commitments,

Over the past five years, the combined enterprise value of CEE startups has increased by 2.4 times, now totaling €213 billion. Startups and scaleups backed by venture capital have experienced the fastest growth, adding €21 billion in value during the same period. Despite this growth, the late-stage segment of the market remains shallow, creating a funding gap for technology startups as they mature and seek to expand internationally.

"We would like to thank our investors. The successful first close of our next fund reflects the strong performance of Cogito Fund I and our team," said Sylwester Janik, Managing Partner at Cogito Capital Partners. "We are excited about the unique investment opportunities created by the clear equity gap in funding for scale-ups across European markets and the high-growth potential of the technology sector in Central Europe.”

IFC’s financial support is critical in the current challenging fundraising environment, enabling the fund manager to reach the target size to execute its early-growth investment strategy.

"CEE economies need more dynamic venture ecosystems and equity financing to boost competitiveness and converge with the highest EU standards," said Ary Naïm, World Bank Group Country Manager for Poland and IFC Manager for Central and South Europe. "Together with Cogito, we aim to accelerate digital transformation and build a regional ecosystem that aligns innovation, skills, and financing."

IFC has supported the development of private equity funds in Eastern Europe for over 20 years. To date, IFC has invested over $100 million in eight venture capital funds across the CEE region.