Pension Funds Invest In Photonic Chip Maker EFFECT Photonics

EFFECT Photonics today announced that it has completed a €35M Series D investment round. In addition to a follow-up investment by Invest-NL's Deep Tech Fund, two pension funds, PMT and PME, also participated in this round. Deep-tech companies such as EFFECT Photonics generally require significant investments due to the complexity and innovative nature of their products, resulting in higher risks and potentially longer periods for realizing returns. Invest-NL welcomes the involvement of traditional capital, which also shows confidence in EFFECT Photonics.

EFFECT Photonics is a spin-off of Eindhoven University of Technology. The company specializes in the development and production of photonic chips, which use light to transmit information, unlike traditional electronic chips. This makes the chips faster, more energy efficient and more compact. This follow-up round enables EFFECT Photonics to increase both development and production and expand production capacity.

The photonic chip industry is recognized by Invest-NL as one of the critical technologies - in addition to quantum technology and AI - in which investments are made through the Deep Tech Fund. This fund, managed by Invest-NL, has a total amount of €250M, of which €175M is contributed by the Ministry of Economic Affairs and Climate (EZK) and the remainder by Invest-NL itself.

René Brama , senior investment manager at Invest-NL, explains: “We are extremely satisfied with the progress and management of EFFECT Photonics, which confirms that the Netherlands occupies a leading position in the world of photonics. The participation of pension funds shows that EFFECT Photonics can count on a solid group of investors with considerable confidence in its future.”

The Invest-NL Deep Tech Fund is investing €10M in this round, in addition to previous investments in 2023 and 2021.