Verdane’s Staffan Mörndal on managing $8 billion in assets

Robin Haak: Nice to meet you, Staffan. I wanted to start with your most recent funding round and the fact that Verdane is now managing over $8 billion in assets. You’ve grown to 155 people, consistently acquiring big funds and scaling with every fundraising round. How did Verdane get to this point? What’s the story?

Staffan Mörndal: I think it’s a combination of some luck and some skill. At the end of the day, it’s very much a people business. I think what we’ve done right is hiring the right people and perhaps focusing a bit more on culture and values—the so-called "soft stuff"—than some others in our industry.

That kind of long-term investment in people helps them make better decisions, improves their skills, and, most importantly, keeps great people at Verdane rather than losing them to competitors. Over time, that pays off.

Beyond that, I think we’ve been careful to balance risk and reward in our investments. The last couple of years have been tough for many investors who took on a lot of risk. That approach worked well in the boom years but led to serious problems when the market shifted. We’ve always been more mindful of downside risk, and that’s helped us maintain strong performance even in difficult times.

Verdane is also a B Corp, which is quite an unusual position for a fund and a growth investment firm. What was the strategy behind that?

Staffan Mörndal: It was not so much a conscious decision. We started compensating for our flights and such almost 15 years ago. We stopped making investments that we didn't think made sense for the environment, such as in the oil and gas sector or fast fashion. You could probably argue that you could invest in some such companies and transform them, but we had that bar of things where we didn’t feel we were able to tell our kids that we were on the right side of history if we did. So we stopped already many years ago. We also set up a foundation in 2016 that owns 10% of Verdane, as well as part of the management company’s carry, etc. So the whole “doing good” thing has been more because we want to do it rather than for a specific strategic purpose—other than wanting to do good.

A few years ago, we set up our first Idun fund, an Article 9 fund investing in decarbonization. We just set up the second one recently. And that is clearly helped by having the DNA that we do, but they're not necessarily connected apart from benefiting from each other. And I would also say that we do quite a lot of things that we don’t talk much about. It just feels right. For example, we now put carbon into the ground for all the flights we take. So we compensate properly—not just pressing the button for trees when we book a flight, but buying carbon removal from startups that are physically putting it into the ground, which is super expensive. It actually costs us more than the flights themselves. We’re now paying more than €2 million a year to take carbon out of the air, so to speak.

How do you balance doing good with delivering returns for your partners?

So we have one investment committee for the financial investments. It ensures we meet a certain return level and certain risk parameters—that's managed like any other investment committee. Then we have a separate sustainability committee that does the underwriting. That’s a separate board with separate board members, and they assess the decarbonization scope and how we measure and calculate that impact. So an investment has to pass both committees. That makes it even harder to find the right investments, but it needs to pass both bars to be accepted.

But as you said, a lot of these impact-driven companies require huge upfront investment, and it can be difficult to predict when they’ll start generating returns. How do you approach these long-term investments?

No matter if it's that type of investment or any other, we always invest in long-term trends. We want to invest in trends that have staying power. So usually, there's a big trend and a subtrend. There’s a big trend of decarbonization needed in the world for the next many decades, and then a subtrend within that might be electric vehicles. And then, several different underlying trends support an investment thesis. We always try to work with those trends because then, even if you get something a little bit wrong, you still kind of grow into the right place if the trend is big enough.

We usually don’t do the riskiest investments where there’s very heavy negative cash flow because, of course, if it takes another couple of years, even if the trend is on your side, those extra years can be very expensive. So those types of investments we normally don’t do. We’d rather do the ones where there is significant revenue per day. For example, we do a lot of software investments where the software helps decarbonization, but there’s already a working business model. It's not about starting from zero and building something that might or might not work.

Both myself and others who have been founders before probably find it easier to connect with entrepreneurs. They feel we understand them better—which we probably do—because we understand the friction, the challenges, and what it takes to get everybody on board to make things happen. It’s not just about putting everything nicely on a spreadsheet or a PowerPoint—it’s about actually getting it done. And I also think that in general, if you have entrepreneurial DNA, you're often more of a doer—someone who focuses on execution rather than just talking about things. I think having that kind of mindset is usually good to have on the team.

And talking about entrepreneurial DNA, I wanted to touch on your time as a founder and how that experience shapes your work as an investor. Do you think it gave you any superpowers? Was it something that was always in you, or was it something you learned and developed over time?

For me, I think it was always there. I started trying to sell things and come up with my own ideas very early on, probably before I even started school.

What kind of things were you doing before school?

I don’t really know where I got it from, because no one in my family was entrepreneurial at all. But I was always thinking about ways to earn some extra money—selling things, coming up with little schemes to buy candy, or whatever I wanted at the time.

Sounds like you had an entrepreneurial mindset from the beginning. You’ve been at Verdane since 2006 and have taken on different roles over the years. How has your journey evolved within the company?

So I started at the lowest level as an associate, but I’ve been a partner since 2011. So I’ve been a partner for quite a long time while the company itself has grown significantly. Back when I started, we were much smaller, and I feel like I’ve been able to grow alongside Verdane, facing new challenges as the company evolved. Now, I work with much larger companies, which requires a different skill set. You have to work more through others, and focus on organization and governance, rather than being the one solving every problem directly. Sometimes I miss that aspect, but my role now is about making sure the right people are in place to drive things forward.

I also set up our Berlin office, which felt a bit like being an entrepreneur again—finding an office, and getting things running from scratch. Internally, I’ve worked with different teams and taken on different responsibilities, but in the end, the core work is still similar. As the organization grows, my focus has shifted more toward enabling others to specialize and excel in their areas, while I focus on where I can add the most value.

What aspects of your work do you enjoy the most? What drives you?

At the end of the day, what I enjoy most is doing deals—negotiating complex transactions and helping growth companies create real value. I’m less interested in governance and reporting; I prefer the strategic side, figuring out how we can help a company expand into a new market or optimize its operations. Those hands-on discussions are what I find the most exciting.

Can you tell me about a deal you’ve worked on recently?

One of the deals we did earlier this year was with VNV Global, a public investor focused on growth investments. They needed to repay a public bond and were looking to raise capital by selling part of their portfolio. They asked us to go through about 50 of their portfolio companies and identify which ones we could acquire to make the best deal for both sides.

It was quite a complex starting point, but a really interesting exercise in optimization. In the end, we acquired four companies from them, with the largest being a U.S.-based booking platform for hairdressers and wellness services. It’s a sizable business, generating around $100 million in revenue.

And what do you enjoy about working on these kinds of complex deals?

I love it. I enjoy sitting down with someone, understanding what they need, and figuring out how to structure a deal that works for everyone. The best deals create a win-win situation, and when that happens, it opens the door for more deals with the same stakeholders in the future.

So, you have an office in Berlin, but you’ve also spent a lot of time working in Stockholm, right? Do you see any major differences between the Nordic approach to investing and that of Central Europe?

No. It's quite similar in the industry. The industry itself is quite international, and a lot of people in the field have studied or worked in different countries. For example, I studied in France, the U.S., and Sweden, so there’s a lot of cross-border experience in this space.

One difference I’ve noticed is that some German investors tend to have narrower mandates—they might set up a fund with very specific criteria, such as only investing in primary capital, minority stakes, or a particular deal size. At Verdane, we’ve always maintained a more flexible mandate, and I think that flexibility, both in mindset and approach, has helped us.

Culturally, I’d say there’s a more consensus-driven approach in Sweden, which has both advantages and disadvantages. On one hand, it takes a bit more time to align everyone before moving forward. But once alignment is achieved, execution tends to be very strong. In other markets, investors might move faster but also step on more toes along the way. There are pros and cons to both approaches.

You mentioned that private equity and investing are very international industries, but when you think about the state of European investing, what do you see as the biggest challenges or opportunities right now?

At Verdane, we invest in software, consumer, and decarbonization as our three main themes. We also do portfolio transactions where we acquire several companies in one deal. One of the biggest challenges right now is that it's tough to sell companies in the current market, especially those with negative cash flow or any other imperfections. Everyone is a bit risk-averse and cautious about where the world is heading.

That difficulty in selling creates opportunities for our fund. If companies are struggling to divest in traditional ways, selling multiple businesses in one transaction becomes more attractive. That benefits us because it allows us to structure deals that work for both sides. So we see a lot of opportunity there.

I also think the next couple of years will be interesting with AI. We’re seeing AI start to replace certain SaaS solutions, offering competitive alternatives at lower costs. Digitization is continuing to accelerate, and automation is creating new opportunities. Another area that will likely see growth is defense tech, although we don’t invest in that sector ourselves.

Trump has just taken office again in the US, and there’s a lot of concern about what that means for environmental policies and investments in areas like decarbonization. Do you think European investors should double down in this space given the current situation?

Good question. I believe the decarbonization investment thesis is much bigger than any one president. It’s a long-term global trend that will play out over decades. That said, Trump’s policies do introduce more uncertainty, which can create both risks and opportunities.

I’m much less confident that the current COP program and short-term policies will go in the right direction with the US taking a different stance. But that doesn’t change the mid-to-long-term outlook for decarbonization as a crucial sector. I wouldn’t necessarily say we should double down, but we are staying committed over the next four years.

How would a trade war—or even just a more protectionist stance from the US—affect European investment? And besides decarbonization, what other long-term trends are you focused on right now?

That’s something every investment committee will be discussing in the coming years. The biggest overarching themes we see are digitization and AI. AI and decarbonization are probably the two most significant long-term megatrends right now. The other trends are much smaller in comparison.

Those are two massive forces that will change a lot in the coming years. But when it comes to AI, it feels a bit like the early days of the internet in the 1990s—exciting but also unpredictable.

How do you assess the value of AI startups in this environment?

We usually invest late enough that we don’t have to make that judgment call because it's just so hard to predict. What we do instead is always evaluate the downside and upside risk in an investment. We focus on companies with significant existing revenue, typically around break-even or already profitable.

For example, in edtech, there’s a real risk of AI disrupting existing models. AI can replace a lot of what you would otherwise have to pay for, so we tend to stay away if there's a chance the business could be overrun by AI. Internally, we have a big team of experts—more than 30 people—many of whom focus full-time on AI and data. Their role is to help our portfolio companies stay ahead and make sure they’re on the first wave of innovation rather than being left behind.

Let’s take the last couple of minutes to talk about you, Staffan. You mentioned earlier that you didn’t come from an entrepreneurial family, but you had this early drive to sell things. Did you find a sense of community early on? Do you feel like you discovered your place in this world early in life?

I did, absolutely. I started my first company when I was in eighth grade, and then I launched my first proper company in my second year of university. The startup and entrepreneurial community has always been very accepting and vibrant, so I definitely felt comfortable in it.

And we talked a bit about what you'd like to do more of, and that’s deals, which is great. But what about your personal life? What would you like to do more of?

I have a wife and three kids, so when I do have time for something extra, it usually revolves around them. I love traveling and trekking—I'd love to take my family to Nepal, for example, to go trekking in the mountains. Adventure holidays are something I really enjoy, and I try to carve out time for them when I can.

How do you find balance?

Physical activity helps. I go for a run, hit the gym, or play padel—I’m actually playing with some colleagues this evening. I find that when I protect time for exercise, it helps me stay mentally fresh and cope better. If I don’t, I end up feeling burnt out or getting sick. I think a lot of people feel the same way. It was really hard to find balance when the kids were younger. It’s tough because small kids simply require 100% of your attention.

What would you say are your top three achievements?

I wouldn’t tie it to the capital per se, but rather to being part of building Verdane into what it has become. When I joined, we were around 10 people, and now we’re a 150-person team. That whole journey with Verdane is something I see as a big achievement. And, of course, like any proud parent, I’d have to mention my three boys. I think they’ve turned out pretty well.

Beyond that, I’d say I’m proud to have played a part in several success stories—helping companies grow, employ a lot of people, and become successful. I won’t name any specific ones, but there have been quite a few where I feel I helped push the needle. And I’d also say that helping Verdane evolve into a firm that actively does good in the world is something I’m proud of. It’s not just about the firm’s growth but also about using its influence to make a positive impact. It’s much easier to do that through an organization like Verdane than to try and do it at an individual level—unless you have Elon Musk-level money.

Thank you for your honesty and your time today.

Sounds great, Robin. Thanks a lot!