AP Fond 6 has not disclosed the size of its allocation to Business Builders, although Lars Lindgren, managing director of Business Builders, confirmed that the fund would look to make investments of up to E1m in three to four companies per year over the next four to five years. “Business Builders invests in early-stage companies in and around Stockholm and Uppsala. The new initiative will co-invest in later rounds when the portfolio companies become more established.” AP Fond 6 is the sole investor on this occasion although future fundraising may seek third party investors.
Business Builders has invested in early-stage Swedish technology businesses since its creation in 1984. Lars Lindgren is a founding member and former chairman of the Swedish venture capital association. “We have always been a conservative investor, limiting our investments to around E1m to E2m even during the boom years.”
Lindgren added that he expects the fund to make two investments before the end of 2002 as the fund looks to capitalise on a sharp reduction in valuations. “Like everywhere else, Sweden has suffered as a result of the dip in valuations of technology and IT businesses. It is now possible to acquire decent sizeable minority stakes at very good prices.”
The fund is the second commitment to technology by AP Fond 6 in as many months following the launch of Creandum, a E36m technology fund launched alongside Skandia Life in early September.