The world today is riven by cultural differences, political divisions, and geopolitical disputes—a challenging environment for any investor hunting for startups that can grow large enough to deliver venture-scale returns. Kompas VC, operating out of Amsterdam, Copenhagen, Berlin, and Tel Aviv, has developed a regionally sensitive strategy to help it navigate this fragmented world.

“We see the world really falling into three main spheres of economic activity—the U.S., Europe, and China,” Sebastian Peck, partner at Kompas VC, told TechCrunch. “These three domains follow very different trajectories.” Kompas has staked its reputation on backing startups that tackle core industrial competitiveness challenges, from manufacturing and supply chains to critical infrastructure and sustainability.

Kompas’s newly raised second fund should give it ample opportunity to lead early stage rounds with checks ranging from €3 million to €5 million. As a European fund, Kompas has access to a range of founders and startups in the region but must weigh how global fragmentation might limit their potential for delivering venture returns.

“It feels like such an intuitive solution,” Peck said of prefab housing. “It’s a product that is effectively an industrial product. It should be highly scalable.” However, its lack of appeal outside Scandinavia has more to do with “cultural conditioning” than the technology itself.

The fragmentation extends beyond housing. In Europe, sustainability remains broadly attractive, in contrast to the U.S., where it doesn’t have the cachet it once did. Yet, a lot can change quickly, and Kompas is investing over 10- to 15-year horizons. “There’s a great space for highly focused, highly specialized, smaller funds like ours to be the first check-in and bring sweep up certain themes and founders,” Peck said.