Partner A. Milukas shares his thoughts about Lithuanian and Baltic startup scene with Amber Startup

Audrius Milukas is Partner and CEO of Open Circle Capital. He also co-founded fintech lending business SME Finance. Before OCC, Audrius spent 15 years as a senior banking and corporate finance professional, including leading regional Baltic positions at Finland-based Nordea Bank. We reached out to him to chat about the Lithuanian and Baltic scene in a conversation that ended up full of interesting bits of insight.

How did you arrive in the startup world?

Open Circle Capital (OCC) started its first early-stage fund back in 2017. Together with other fund partners Rokas Tamosiunas (LT), Jens Damsgaard (DK) and Will Cardwell (FI/US), we saw a window of opportunity to invest in local startups as there was only one active VC fund which basically had no competition.

As a result, we joined forces, applied our international experience and managed to win backing from the Lithuanian government. We also closed a number of corporate LPs to start activities in our €20 million fund. Fast-forward to today, OCC has generated a pipeline of 3,000 companies and in total made 45 investment rounds in 16 portfolio companies. These include local early-stage success stories such as Whatagraph, Billo and Paysolut which was acquired by international unicorn SumUp, and Eddy Travels, recently acquired by New York-based TripAdd.

However individually, our love story with the startup world started many years before Open Circle Capital saw the light of day. Both Will and Jens have been running VC funds, making angel investments and managing tech-transfer activities in the Nordics since the 2000s.

Rokas is known for being among people who kickstarted the startup ecosystem in Lithuania 15 years ago by being a mentor and starting the first local accelerator – Startup Highway.

Lastly, my personal journey in the startup world started as a founder in 2016 when I co-founded fintech company SME Finance which right now is among the most well-known fintechs in the region.

How is OCC different from other VCs in Lithuania / the region?

First of all we are a venture capital firm that has partner-level people based in Baltics and also multiple countries in the Nordics with a combined industry experience of more than 60 years. As a result we are able to use our vast network of investors, corporates and founders in order to find the best deals and also to help our portfolio companies to scale and to raise follow-on rounds.

Also our partners have a diverse skill set in founding, discovering, scaling, and exiting companies in software, fintech, robotics, and energy. In total, partners until this date have made more than 200 investments and a number of successful exits including the M&A deals for hundreds of millions euros.

We love to syndicate. In total our portfolio companies to date raised around €36M, 60% of this amount was contributed by other VC funds, angels, corporates etc. This helps us firstly to discover the quality deals and later to have a strong boards of directors for guiding startups in their journey.  We have more than 50 successful angels / founders in the network who are keen to invest and to share their experience with early-stage entrepreneurs. 

Furthermore, we are co-founders of the Lithuanian Business Angels Network (LITBAN) which has more than 250 members and last year in total contributed ~€10M as investments into startups. This is again a great source of early stage companies which have already raised initial capital to show first results and in the process have been coached by experienced entrepreneurs.

Lastly, as our name suggests we are always open for founders and partners. Of course the majority of time is spent helping our founders with their headaches but also whenever possible we feel obliged to support all local founders with intros to different types of investors, capital raising advices and management decisions.

How do you see the Lithuanian startup ecosystem? Could you do a quick/short SWOT for us?

One word – promising. Currently according to different sources there are 800-1400 startups in the Lithuanian ecosystem. Our calculations shows that out of this number we already  have 2 unicorns, up to 20 success cases (>$10M funding or >200 employees) and 80+ rising stars (>$1M equity funding or >50 employees) which are distributed among many different sectors including of course the major ones – software, fintech and e-commerce but also great companies are founded in AI, transportation, health tech and other fields.

We are convinced that such numbers of quality startups will increase further in the upcoming years as talent recycling will accelerate. Vinted, NordVPN, Hostinger, Kilo Health and other local tech champions eventually will produce dozens of highly skilled founders who will have both experience and capital to launch their rockets into the sky. This happened in Estonia (Skype phenomenon) and other countries. Alumni from the top 15 $1 billion-plus companies produced >2000 new founders. There is no doubt it will happen in Lithuania too.

Regarding weaknesses and threats – my personal opinion is that our funding infrastructure is still underdeveloped and is not meeting current standards which are at the moment raised by startups. In the first half of 2022, Lithuanian startups have attracted 6 times less capital than Estonian startups and that’s a pretty massive gap to consider. What is worse, during the same period early stage startups (pre-Series A) in Lithuania received only €13m of investments while Estonians received €46.2m. In the second part of the year the situation might not improve as all three local venture capital funds including us finished or are finishing their investment periods.

As a result many good startups which are still too early for global investors will be forced to bootstrap which is not in all cases the best path for growth and international competition. We definitely need to address that and strengthen both the total size pool of potential investments and also the continuity of the funds.  

Also the tech transfer process could be improved significantly by applying the best practices from countries such as Finland or Israel. A lot of great technologies and innovations are born within university research walls and too many of them do not reach a well deserved commercialization phase.

If you could change / improve something about the Lithuanian ecosystem, what would it be?

I believe the lack of funding at the moment is the biggest threat to overcome. I hear a lot of comments that maybe the quality of our startups is not good enough and maybe we should focus on that instead of pouring money into the ecosystem.

My thinking is that we have plenty of talent but they are lacking both knowledge and resources to compete in the international markets. And we can improve that by adding more capital into every layer of the early stage startups ecosystem: more incubators, more accelerators, more seed funds, more support for angels.

More investors equals not only more capital but also more maturity in the market as in most cases VC funds not only invest cash but also educate their portfolio founders in order to maximize returns. 

Where do you see it going in the next 12 months – 5 years?

There might be a slowdown in the next 12-24 months given the current macroeconomic climate and the local funding problems I have expressed above.

However, in the long term I am feeling very optimistic for the whole Baltic region. In 2022, alone we already received >60 external applications for funding. The market is alive and growing. If we would add the potential next wave of unicorns and exits which would emerge from our late stage startups pool – both the number of entrepreneurs and startups will be more than sufficient.

Then the main thing to focus will be to strengthen the early stage-funding infrastructure and I believe that we can build it in the next 3 years by aligning the effort of VC funds, angels,  government and institutional investors.

What does OCC look for in startups (geo, vertical, etc) and founding teams (soft skills, etc)?

Our first fund focused on startups which have operations in Lithuania while the second fund (currently fundraising) will expand our reach to the whole Baltics and also will include selective countries in Nordics and CEE.

For the second fund we are planning to continue our generalist approach which basically means that we want to be able to invest in the best regional founders if their solution market is big enough for a VC case. Our focus will be on B2B software startups which have elements of deep technologies such as artificial intelligence, machine learning, IoT and more.

As mentioned above, founders are and will be key parts in our selection process. Typically we are looking for serial entrepreneurs and/or people with extensive professional selected domain experience who are ready to hustle in order to reach the highly ambitious goals. Also the early signs of high growth and leadership in a particular international market niche is an important criteria which lets us spot really exciting investment opportunities.

What are some startups in your portfolio you are excited about? What impact have they achieved?

We are generally excited and of course biased when we are talking about our portfolio companies so I will name a few examples which demonstrated great progress in the last few years.

Whatagraph is our early frontrunner. The company is developing software for automating marketing performance reports. We made our first investment in Whatagraph 3.5 years ago when the company was making $30k in monthly recurring revenue (MRR). Since then the company has grown more than 10x and successfully raised Series A of $7.2m from us, Inventure, the Lithuanian fund Litcapital and angel investors.

We also supported Billo app – currently the number one platform for custom made eCommerce video ads – since the early days. Last year the company achieved a 9x growth of annual GMV and established itself as a niche leader in the United States. What is more, the company is developing a new TikTok product which itself could cause important disruption in the video ads market.

Also, OCC made five investments into startups which are working on AI technology and its applications. A notable example is Pixevia which provides a full solution to run AI-powered autonomous smart stores. The company opened the first such store in Europe back in 2019 and this year they have opened the first branded store together with Rewe Group. Given early adoption levels of AI technology and as a result the remaining potential – the sky’s the limit for this company.  

Lastly, during these uncertain times, we are happy to have in our portfolio energytech company Solarbank which enables both consumers and businesses to buy remote solar power panels and offset their electricity bill by producing solar energy. Its technology and business model proved to be a huge success in Lithuania and definitely other European countries should follow and introduce relevant legislation which would help such technology to expand and as a result help to fight the upcoming energy crisis in the region.

And what about your anti-portfolio? Which startups did you pass on that you would have loved to invest in?

We definitely passed on a number of great opportunities to invest. This is an inseparable part of the VC fund journey. However, we are not spending much time regretting as we understand that investment opportunities and their evaluation depends on timing, market conditions and other factors. 

For instance, I can disclose that we passed on the opportunity to invest in Interactio back in the early days of the startup. We definitely liked the founder and business idea but the combination of traction and deal terms was not convincing.  Right now this looks like a missed opportunity since the company emerged as global leader of its niche and accordingly raised $30 million Series A. But again – back then we had our arguments and logic, and as a result we do not overthink this decision.

What advice would you give (Lithuanian / Baltic / CEE) founders to navigate these turbulent times?

Great ideas and business will manage to get funding from local, regional or international sources but in my opinion it will require more time and hustle compared to recent years.

As a result my advice for founders is to focus on survival – if you have a business which is generating substantial revenue maybe the best decision is to review expenses and minimize any not necessary spending in order to prolong the runway. And if you are still in the pre-seed stage –  you still can definitely be funded by funds, angels and accelerators but you must face the reality and understand that potentially valuation, deal terms and competition in general will be very different compared to the market situation last year.

What’s next for Audrius and OCC?

We are raising a new fund – Open Circle Capital II! Our goal is to have a €60 million euros fund to support seed stage founders in Baltics and selective countries in Nordics and CEE. Stay tuned for the updates!

What’s the best way for people to stay updated with the latest from you and OCC?

We share updates regularly in our Open Circle Capital social media pages as well as our personal LinkedIn accounts. Also we have our own newsletter – everyone is welcome to subscribe and receive the latest news about OCC and the startup world.

And of course if you have any questions please do not hesitate to send me a LinkedIn message or email ( We have ”open” in our name for a reason!