German VC Redstone, today announced they are launching North Karelia Growth Fund II at €10 million, with intial tickets ranging from €100k to €300k – the new fund builds on the North Karelia Growth Fund established in 2020.
Investors include the City of Joensuu, Broman Group, University of Eastern Finland, LähiTapiola Itä, North Karelia Cooperative Society (PKO), OP North Karelia and Laakkonen Kapital.
“Five years of working alongside exceptional founders in North Karelia has shown us the depth of expertise in the region. The ecosystem has matured significantly, and partners such as Business Joensuu have played a key role in creating even stronger conditions for new growth companies to emerge. This potential, combined with our focus on returns, is exactly why we are now launching a second fund,” says Kaj Hagros, Managing Partner at Redstone Nordics Oy.
Fund II launches amid a broader expansion of specialist European venture vehicles targeting many of the same technologies.
EU-Startups has reported around €2.5 billion in 2026 fund announcements spanning DefenceTech and dual-use, DeepTech and the energy transition. These include the €500 million E2D and €500 million DTCP Project Liberty defence and resilience funds, Lakestar’s €262.2 million Resilience I vehicle, and Kembara’s €750 million first close for its DeepTech growth fund.
In Northern Europe, Copenhagen-based The Footprint Firm closed a €76 million fund for early-stage climate and DeepTech companies, while Climentum Capital reached a €60 million first close for its second climate HardTech fund.
Against these larger pan-European vehicles, North Karelia Growth Fund II represents a more geographically concentrated, early-stage approach, combining €100k–€300k initial tickets with a mandate spanning semiconductors and photonics, defence and dual-use technologies, and the energy transition.
“It is great to see experienced fund managers such as Redstone continuing to invest in our region. This kind of long-term commitment strengthens the conditions for growth and new jobs across North Karelia,” says Jere Penttilä, Mayor of Joensuu.
Founded in 2014, Redstone is a Berlin-based venture capital firm with 15 funds and approximately €650 million in AUM. The previous iteration, North Karelia Growth Fund I, invested in 17 early-stage companies.
One of which was the Joensuu-based airship company Kelluu, which the fund supported as one of its first institutional investors. This year, Kelluu raised €15 million in a funding round led by the NATO Innovation Fund and was interviewed by EU-Startups.
“The fund invested in our company at an early stage, when we were still proving our concept on the edge of Europe. Having an experienced, locally present investor on board from our first funding round helped us build the growth trajectory that brought us to where we are today,” says Janne Hietala, CEO of Kelluu.
Over the next five years, the new North Karelia Growth Fund II is set to invest in approximately 15–20 early-stage growth companies based in North Karelia or building a significant presence in the region.
Initial investments will range from €100k to €300k – with a heavy focus on semiconductors and photonics, defence and dual-use technologies, and solutions supporting the energy transition.
The fund will be headed by portfolio managers Kaj Hagros and Mikael Myllymäki.
“North Karelia needs new companies and entrepreneurs who are willing to work hard – they are the foundation of our region’s vitality. It is good to see capital and expertise being directed here, where the work is being done,” says Harri Broman, Chair of the Board of Broman Group Oy.
Source: EU-Startups
