A look at Berlin-based Rocket Internet, as founder Oliver Samwer transforms one of Europe's most aggressive tech VCs into a more conservative investment house
Context & Ripple Effects
Rocket Internet built its name on incubating copycat startups and raising big vehicles for the strategy — a €1 billion growth fund for late-stage bets in 2015, followed by a $420M Europe-focused fund in early 2016. But the incubation engine never found profitability, and the stock sat at roughly a third of its 2014 peak as coverage found the firm better at starting companies than running them.
Oliver Samwer's answer, per the Financial Times, is to stop being an aggressive tech VC and run Rocket Internet as a conservative investment house. That retrench is now colliding with its own shareholders: in a recent [[a:893852|letter, minority holder Scherzer & Co accused the company of marking down startup valuations]] to buy out backers at bargain prices — the same markdowns a conservative house would rationally make.
First-order effects
- Samwer's shift changes what Rocket Internet is for: the incubation machine that defined it gives way to a conservative book, directly affecting the minority shareholders now fighting markdowns and the founders who once counted on its aggressive early checks.
Second-order effects
- With Europe's most aggressive startup factory standing down, other European late-stage investors face less price competition for deals Rocket's growth funds once chased — while Scherzer & Co's accusations force Rocket to defend its valuation marks publicly rather than quietly reset them.
Third-order effects
- If the pattern holds, the listed incubator model — public-market capital deployed into risky company creation — gives way to conservative investment-house structures, with public shareholders increasingly policing the marks private startup stakes are carried at.
The trend: Europe's copycat-incubation era is ending as its most aggressive backer, Rocket Internet, retrenches into a conservative investment house under public-shareholder scrutiny.