Armilar raises €120M to bet on Iberian DeepTech startups

According to EU-Startups, Lisbon-based Armilar Venture Partners has announced the first closing of its Fund IV at over €120 million, targeting Series A investments in DeepTech and digital transformation startups across Spain, Portugal, and Europe. The fund has attracted institutional backing from Spain’s Sociedad Española para la Transformación Tecnológica (SETT) and the European Investment Fund, with Armilar aiming to build a portfolio of around 20 companies. Managing Partner Pedro Ribeiro Santos called this the “natural next step” for expanding their Series A platform, while Partner Duarte Mineiro highlighted the “growing opportunity” in Iberia’s entrepreneurial ecosystem. The firm plans to continue fundraising through 2026 with the goal of doubling the fund’s size, working in collaboration with CaixaBank to attract more Spanish institutional investors.

The Iberian DeepTech moment

Here’s the thing about Armilar’s latest move – it’s not just another VC fund announcement. This represents a serious bet on the Iberian Peninsula becoming a legitimate DeepTech hub. Portugal and Spain have traditionally been better known for tourism than for cutting-edge technology, but that’s changing fast. Armilar’s partners specifically called out the combination of “world-class talent, rising R&D intensity, and increasing institutional support” as driving this shift.

And they’ve got the track record to back up their optimism. This is the same firm that backed OutSystems and Feedzai from their early days – two companies that became global leaders in their respective fields. When a VC with that kind of pedigree doubles down on a specific region and sector, it’s worth paying attention.

Why now makes sense

What’s really interesting is Armilar’s timing. Founding Managing Partner Joaquim Sérvulo Rodrigues openly acknowledged that we’re in a “liquidity shortage” with VC fundraising potentially hitting five-year lows in 2025. So why raise a fund now? Basically, they’re betting that less competition for deals plus more interesting opportunities equals the perfect moment to deploy capital.

Think about it – when everyone’s rushing to invest during boom times, valuations get inflated and due diligence gets rushed. But during periods when other investors are sitting on the sidelines? That’s when disciplined firms can find genuine bargains and build meaningful relationships with founders who are building through the tough times.

The investment thesis explained

Armilar isn’t just throwing money at any startup with a .tech domain. Their focus is specifically on the intersection of digital technologies and applied science – what they call “B2B startups with high technological content.” That means they’re looking for companies solving real business problems with serious tech chops, not just another SaaS platform.

Their target areas read like a who’s who of current hot sectors: AI, cybersecurity, software development infrastructure, SpaceTech, dual-use technologies, FinTech, HealthTech. But here’s the key – they want companies that have moved beyond the idea stage and are ready for Series A funding to scale. These aren’t seed investments; they’re backing companies that have already validated their technology and need fuel for growth.

The Spanish connection

Don’t miss the significance of the Spanish institutional backing. SETT isn’t just another investor – it’s a Spanish government instrument specifically designed to advance technological innovation in Spain. When they choose to back a Portuguese VC firm to invest in Spanish startups, that tells you something about both Armilar’s reputation and Spain’s commitment to building its tech ecosystem.

The collaboration with CaixaBank to attract more Spanish LPs suggests Armilar sees Spain as a massive opportunity. Given Spain’s larger economy and population compared to Portugal, this makes strategic sense. But it also raises the question – are there enough quality DeepTech startups in Spain to absorb this kind of focused capital? Armilar seems to think so, mentioning they’re already analyzing several Spanish startups for their 2025 pipeline.

Ultimately, this fund represents a vote of confidence in European DeepTech at a time when many investors are pulling back. Whether that confidence is well-placed remains to be seen, but Armilar’s track record suggests they know what they’re doing. The next few years will show whether Iberia can truly become the DeepTech powerhouse they’re betting on.