Horizon Capital Growth Fund IV (HCGF IV) has surpassed its target, raising an impressive $254 million and becoming the first 2X Flagship Fund in Central and Eastern Europe (CEE). Under the leadership of Founding Partner and CEO Lenna Koszarny, HCGF IV aims to provide growth capital to entrepreneurs in Ukraine and Moldova. The Ukrainian tech industry has seen significant improvement in gender diversity, with women in tech increasing from 7% in 2012 to 27% in 2021.
2X Flagship Fund: A commitment to gender equality
The 2X Flagship Fund status is a prestigious designation awarded to investment funds that actively promote gender equality and women’s economic participation. Launched at the G7 Summit in 2018, the 2X Challenge is a commitment by development finance institutions to invest in businesses that advance gender equality in finance. HCGF IV is not only the first fund in the CEE region to receive this status but also one of only two such funds globally that are women-founded and women-led.
With a gender lens applied to its investment strategy, HCGF IV aims to build a portfolio with over 30% of 2X eligible investments. This approach aligns with the firm’s commitment to advancing women in private equity and supporting businesses that demonstrate a strong commitment to gender diversity. Research indicates that companies with diverse leadership teams are more innovative, resilient, and achieve better results.
Investing amid the Ukraine-Russia war
The ongoing war between Ukraine and Russia has had severe impacts on the Ukrainian economy. Businesses have ceased operations, faced logistical disruptions, and struggled with fuel deficits, relocated production, staff, currency controls, and finance shortages. Despite these challenges, Horizon Capital‘s HCGF IV has managed to raise an unprecedented amount of funds during such times, reflecting global institutions’ support for a reputable team with a bold vision, proven investment strategy, and track record.
HCGF IV’s international backers mark the first commitment to Ukraine since the invasion. The fund aims to support war-affected businesses and livelihoods, focusing on tech and export-oriented small and medium-sized enterprises (SMEs). By investing in these sectors, the fund contributes to economic revival, job creation, tax base expansion, and capital for SMEs.
Backing from global institutions
Several global institutions have shown support for HCGF IV, with increased commitments from the International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD), which invested $40 million at the first closing. New investors at the interim closing include the US International Development Finance Corporation (DFC), Swedfund International AB (Swedfund), Finnish Fund for Industrial Cooperation Ltd. (Finnfund), and Danish Investment Fund for Developing Countries (IFU). Existing investors such as Deutsche Investitions- und Entwicklungsgesellschaft (DEG), a KfW Group subsidiary, and Dutch Entrepreneurial Development Bank (FMO) have also contributed to the fund.
With over $700 million of growth capital raised for visionary entrepreneurs from Ukraine and Moldova in the past five years, Horizon Capital has established itself as a leading private equity firm in Emerging Europe. The firm-managed funds have invested in over 160 companies, employing more than 77,000 people in the region. As HCGF IV begins making its first investments within one to two months, it will further contribute to the growth and resilience of the Ukrainian economy amidst the ongoing war.
