The current world is marked by cultural disparities, political schisms, and international conflicts — creating a complex landscape for any investor seeking startups capable of scaling up to produce venture-level returns.

Kompas VC, which has its offices in Amsterdam, Copenhagen, Berlin, and Tel Aviv, has crafted a regionally conscious strategy to adeptly navigate and invest in this disordered world. The firm has announced to TechCrunch that it’s injecting fresh funds into this strategy with a new €160 million fund ($187.5 million).

“We observe the world essentially dividing into three primary economic and political spheres — the U.S., Europe, and China,” said Sebastian Peck, a partner at Kompas VC, during his conversation with TechCrunch. “We definitely recognize that these three areas are on very different paths today.”

Kompas has built its reputation on supporting startups that address fundamental industrial competitiveness issues, spanning areas like manufacturing, supply chains, critical infrastructure, and sustainability. While these themes remain relevant, their prominence varies across different regions.

“Back in 2021, there was considerable excitement regarding these themes,” Peck reflected on the year Kompas was established. “In 2026, we find ourselves in a much altered paradigm. It’s centered on AI and rapid, explosive growth. There are numerous significant topics we are partially engaged with, yet they do not fully represent our core mission.”

“Our concentration is on the physical realm, particularly in the production of tangible goods,” he mentioned, stating that Kompas is focused on startups involved in decarbonization, enhancing productivity, and managing risks. “We’ve discovered our niche.”

That niche is surprisingly extensive. Reshoring has become fashionable in nearly all markets, and depending on the startup, these markets generally provide sufficient scale for an entity like Kompas.

While overshadowed by some larger venture capital funds these days, Kompas’s newly established second fund should provide plenty of opportunity to take the lead in early-stage rounds with investments ranging from €3 million to €5 million. 

As a fund based in Europe, Kompas has access to a diverse range of founders and startups in the area. However, it must consider how global fragmentation could restrict the potential for some to yield venture-level returns. Peck references prefab housing as an illustration. This approach is widely adopted in Scandinavian countries, but is less common in Germany or elsewhere in Europe, let alone in the U.S.

“It seems like such an intuitive solution. It’s essentially an industrial product. It should be easily scalable,” he expressed. Ultimately, the reason it doesn’t gain traction outside Scandinavia is more linked to “cultural conditioning” than to the technology itself, he added. “In that sector, if the U.S. is not the market you can penetrate, you must consider very carefully whether there is a sufficiently large addressable market.”

The fragmentation encompasses more than just housing. For instance, in Europe, sustainability remains broadly appealing, unlike in the U.S., where this theme has lost some of its earlier allure. 

Nonetheless, Peck acknowledges that rapid changes are possible. “We are investing over 10 to 15-year horizons. That covers several legislative terms, and sometimes developments take unexpected turns.”

This evolving landscape presents challenges, but also opportunities for smaller investors like Kompas. “I believe there’s significant potential for highly focused, specialized smaller funds like ours to be the first check-in and to address certain themes and specific founders,” Peck remarked.