After having invested in 28 start-ups over the past 4.5 years, Backbone Ventures is now raising a dedicated fund targeted at founders in Germany and Switzerland that combine an underprivileged
background with a history of outperforming their competition.
Backbone Ventures announced today the first closing of its 5502 Fund. The fund geographically focusing on Germany and Switzerland intends to provide the first financing for extraordinary founders of technology-driven, high-growth businesses. These founders are structurally underprivileged and have outperformed their competition in the past no matter their gender, ethnicity, or socioeconomic background. It’s an unparalleled focus that can’t be found in any other fund in the DACH region.
“Work ethic, resilience, the ability to inspire others, and a certain degree of boldness are qualities every founder needs to succeed. We see that it’s often those who are used to overcome adversity that have these abilities we look for in founders”, says Miklos Stanek, one of Backbone’s partners.
Valuable companies can be founded by anyone
Why choose this contrarian investment strategy? Firstly, there are too many investments happening based on unconscious bias. And secondly, there is plenty of data telling us why: research shows that in 2022, more than half (55%) of US companies valued at $1 billion or more were founded by immigrants. However, only 18.6% of venture capital funding went to founders with disadvantaged socioeconomic backgrounds. In 2021, 83 out of 595 companies that joined the Crunchbase Unicorn Board were founded or co-founded by women, which is quadrupling that category’s count from 2020. Still, less than 2% of venture capital funding went to all-female founding teams in 2021, which marks a five-year low.
The fund invests in the best founders at the start of their entrepreneurial journeys and before any other investors. To achieve this, Backbone Ventures leverages its vast existing network and concentrates its sourcing on academic and professional ecosystems where they are deeply embedded. Over the next four years, the fund will invest between EUR 300,000 and EUR 500,000 in 25-30 teams of underprivileged outperformers in Germany and Switzerland.
A statement from Jan Claudio Muñoz
Today is a very special day for me, professionally but also personally. Coming from a family with both, a workingclass and refugee background I have always been inspired by the grid, courage and work ethic of many migrants, be it the miners of the Ruhr Valley, the greengrocers in my hometown or those who invent vaccines for world-threatening diseases. When I later started working in law and finance I was equally impressed by the women I met, who often outworked all their male colleagues despite having to endure hidden and sometimes open discrimination.
So since I started doing VC I dreamed of raising a fund that would focus on founders that had that hustler-DNA. I’ve shared that idea with some of you. Sometimes I would call it “Schwarzkopf VC”, sometimes “Hustle Capital”.
Today my partners Miklos, Janic, Philippe and I are announcing the first closing of our EUR20m pre-seed fund, focusing on under-represented founders in Germany & Switzerland.
I am touched and honoured we called it the 5502 Fund, after the postal code of Pachacamita, my family’s hometown in Chile.
Why the funds name is 5502
Why 5502? The fund’s name refers to the postal code of a small village in Chile and is a reminiscence of the origins of one of Backbone’s partners, Dr. Jan Claudio Muñoz, and to the shared values of Backbone’s team.
About Backbone Ventures
Backbone Ventures is an early-stage venture capital firm based in Zurich and Frankfurt am Main. Founded in 2018, Backbone has a track record of 28 investments with already two successful exits so far. With a pioneering investment- and a strong ecosystem approach, Backbone’s mission is to achieve a positive impact for the next generation by supporting underprivileged, outstanding entrepreneurs to reach new levels of success and to become the trusted partner for founders and investors in pre-seed/seed venture capital in Germany and Switzerland. Learn more at backbone.vc.