Expon Capital: Betting On Bold Founders

Luxembourg, September 05, 2025 –
Original Article Published in Silicon Luxembourg

From bold beginnings to building breakout tech success stories, Expon Capital has become a key player in shaping Luxembourg’s startup landscape. With over €90 million invested across 33 companies and a clear focus on B2B SaaS, AI, and sustainability, the firm has proven that even small markets can fuel global ambitions.

Where does Expon Capital stand today in its journey?

Expon Capital was founded with a clear understanding of Luxembourg’s early startup scene. We had followed the journeys of pioneers like Athome/Monster.lu, EuroDNS/Datacenter and others while actively engaged in tech venture. Expon Capital’s founders are from the same generation as the entrepreneurs that shaped Luxembourg’s first wave of tech successes. Jerome had been active as an investor in Luxembourg in a success like VOXmobile (sold in 2007 to Orange) while Alain previously served as a partner at a leading European VC in Paris. Despite knowing Luxembourg’s startup market was neither broad nor deep (i.e. too small), the team recognized the potential for significant tech growth and partnered with the Ministry of Economy to turn Luxembourg into a seed-stage tech hub. The Digital Tech Fund’s initial strategy was intentionally focused, demanding, and disciplined—never meant to function as a soft capital but rather as a competitive venture fund designed to win on market terms. Let’s be frank, with so few startups, the odds of backing the kind of breakout success a VC fund needs even once—let alone multiple times—were low.

While supporting the local ecosystem and delivering impact are core to our mission, we firmly believe that the fund’s success—and itFs long-term credibility—depends on achieving strong financial returns for its investors, over half of which are corporates, family offices and HNWI.

Today, Expon Capital stands as a highly active venture firm within Luxembourg’s borders, and was recently ranked as one of the most active in Europe by FT’s Sifted. With the Digital Tech Fund, we’ve backed over 20 startups with total investments close to €30 million.

Our three funds— Vintage I, II, and III—each have their own personality:

Vintage I: the first DTF supported 6 promising startups, including Salonkee and Passbolt, allowing us to refine our investment approach.

Vintage II: was about pursuing exploration, adding 7 more successful companies, demonstrating our ability to consistently identify promising opportunities.

Vintage III: currently active and focused on emerging tech sectors such as AI, digital health, and sustainability. We’ve already made 7 investments, with several more expected soon.

Given typical seed-stage failure rates (70-90%), the fund has just experienced two failures to date, a notable outcome at these early stages. While it will take time for the full results to materialize, we’re optimistic about upcoming exits and expect solid returns from Funds I and II, given the strong growth across many portfolio companies. Fund IV is already programmed for 2026 to pursue the successful strategy.

“Let’s be frank, with so few startups, the odds of backing the kind of breakout success a VC fund needs even once—let alone multiple times—were low.”

Expon Capital Founders

What are the main success stories from your various funds?

Salonkee —a B2B SaaS platform for hair/beauty salons that grew from fewer than 10 employees to over 250 today (with 100 in Luxembourg alone), sustaining over 100% annual revenue growth for 6+ years —  stands out as a significant success within the Digital Tech Fund. The fund invested seven years ago, following the team’s graduation from Fit 4 Start. The company had a great team, promising KPIs and a market of one million potential clients, Tom Michels (CEO) and his team stood out as very attentive to coaching, disciplined and eager to succeed in what was a tough market to crack, that was enough to convince Expon Capital to back the project.

Marketleap.ai, another standout, evolved rapidly from inception into a fast-growing critical ecommerce partner serving over 50 global brands. The founders, with backgrounds from Amazon and Rocket Internet, exemplify the qualities Expon Capital seeks: intelligence, ambition, and a strong drive. This combined with a substantial market opportunity positions Marketleap.ai for promising performance.

The DTF invested into other notable ‘successes in the making’ across strategic sectors, including Next Gate Tech (Fintech), Coinhouse (Crypto), HydroSat(SpaceTech), and of course Passbolt (Cybersecurity). Each of them is a leading company in its field, guided by highly capable founders.

What total amount have you invested to date, and in how many startups?

Over the past nine years, Expon Capital deployed €90 million across 33 companies in 14 countries—building a portfolio that spans the full lifecycle of venture capital, from pre-seed to growth. While Expon Capital’s reach is pan-European, our activity has intensified over the last five years, particularly in Luxembourg, reflecting our growing conviction about the quality of local opportunities.

The Digital Tech Fund has become one of the useful instruments of Luxembourg’s innovation economy. Through it, we’ve deployed nearly €30 million across 20 startups—including 13 born in the country and one spun out of public research institution LIST. The fund was built on a simple but bold thesis: that with the right support, ambitious tech companies can be built in small markets. Today, that thesis holds true. With a focus on B2B SaaS, the DTF has backed startups in sectors that matter— fintech, space, cybersecurity, health, climate, and AI.

“[…] qualities Expon Capital seeks: intelligence, ambition, and a strong drive.”

Expon Capital Founders

Being often the first institutional investor, The Digital Tech Fund helps companies implement solid corporate governance, enhance credibility with customers, and connect with experts to scale effectively from early-stage ideas to globally competitive businesses.

Beyond Luxembourg, Expon Capital’s growth fund backed companies that are redefining industries across Europe: HelloBetter in Germany is leading the mental health revolution with digital therapeutics; Sympower in the Netherlands is helping balance the electric grid for a renewable future; and Refurbed in Austria is building a circular economy platform for consumer electronics. Each one is a category leader, tackling complex challenges with conviction, and building the kind of resilient, scalable companies that define the next generation of European tech.

How do you perceive the evolution of the tech and startup ecosystem in Luxembourg?

Building a startup ecosystem requires both urgency and patience, typically over multiple decades. Luxembourg’s ecosystem, launched around 2015, has grown impressively thanks to crucial state involvement, private-sector participation, incubators, accelerators, and international investors.

We believe there’s good reason to celebrate what all stakeholders have accomplished—Luxembourg’s startup ecosystem has made remarkable progress over the past decade. But to generate lasting economic impact, the ecosystem must triple in size —ideally to around 1,000 active startups. Given the high failure rates inherent to early-stage ventures, building a thriving startup ecosystem is ultimately a numbers game. Success depends on enabling the emergence of rare, unpredictable outliers—the few companies that will go on to create high numbers of jobs, generate substantial tax revenue, and elevate the country’s global standing. The challenge, of course, is that no one can predict in advance which startups will become those outliers. That’s why policies that encourage the broad proliferation of seed-stage ventures are essential: they increase the odds of producing breakthrough successes that drive long-term innovation and economic vitality.

The local presence of global companies like Amazon has been critical in significantly enriching the talent pool in critical areas like tech, sales, marketing, and operational excellence. Companies like Spire, Talkwalker, and Paypal have further diversified and deepened available expertise. We see this development as absolutely key as it brings breadth and depth in the relevant talent pool necessary for startups to thrive.

After experiencing vibrant European ecosystems from Barcelona to Tartu, we recognize Luxembourg’s distinct advantages and uniqueness: its international mindset, outward-looking ambition, and uniquely experienced founder base. Many Luxembourg founders are seasoned professionals with deep operational insights, offering grounded and committed leadership. They tend to be more ready than younger entrepreneurs.

“The fund was built on a simple but bold thesis: that with the right support, ambitious tech companies can be built in small markets.”

Expon Capital Founders

How do your international VC peers and partners perceive Luxembourg?

Five years ago, Luxembourg barely registered on Europe’s startup radar. Today, the rise of a new generation of founders and strategic investments, including those through the Digital Tech Fund, have led to increased participation from top VCs across Europe and, at the growth stage, the US in local deals. Expon Capital hopes this trend holds despite the challenging VC climate.

What motivates you to invest in a startup?

We seek extraordinary founders who combine global ambition, unique insights, boundless energy, and strong storytelling skills. We prioritize clear business models with potential for significant profitability at scale, backed by a systemic view of market opportunities.

What role do your Entrepreneurs in Residence play?

Our EIR program, now in its sixth year, hosts exceptional entrepreneurs such as Benjamin Blasco, founder of Petit Bambou. EIRs contribute invaluable deal sourcing, critical evaluation, and fresh perspectives on market dynamics. They enjoy an exclusive view of what’s going on inside the VC reactor, see our investment processes in action, enrich our strategic discussions and sometimes enhance portfolio value.

“Being often the first institutional investor, we help companies build governance, credibility, and access to scale.”

Expon Capital Founders

What advice would you give to startups seeking to raise funds today?

We are highly optimistic about Luxembourg’s software ecosystem, primarily because we believe the next major wave of innovation will come from AI-driven agents and the automation of complex, high-value workflows. Luxembourg is uniquely positioned to lead in this transformation for two key reasons:

First, it is a strategic operational hub, home to essential middle-office functions for many global organizations. This has created a deep reservoir of operational expertise and intimate knowledge of critical processes, exactly the kind of workflows now becoming ripe for AI-driven automation.

Second, Luxembourg boasts a highly educated workforce skilled at understanding, dissecting, and optimizing these intricate processes. With their deep expertise, they’re exceptionally well-equipped to identify automation opportunities, and design and deploy sophisticated AI agents that will profoundly boost productivity and efficiency across industries. We’re right here to support the entrepreneurs developing those highly powerful vertical agents.

Finally, access to funding for startups has been tough for years and we believe it will remain like this until the next bubble. So our advice to founders is to pragmatically secure available capital, target quick wins with a good enough product while working on the ideal product over the long-run, maintain clear paths to profitability as soon as you can. The current market favors startups resilient enough to sustain themselves through smart strategies rather than solely relying on external funding.

Orginal article: https://www.siliconluxembourg.lu/expon-capital-betting-on-bold-founders/