Europe & Israel 3Q17 Venture Capital Review

Venture Capital in Europe & IsraelVenture Investment Data: Third Quarter 2017

Prepared by Gil Dibner

Leadenhall Market in the City of London. The market dates from the 14th century, but the current structure dates to 1881. blog

https://twitter.com/gdibner

http://www.angel.co/gdibner/syndicate

https://www.linkedin.com/in/gildibner

http://yankeesabralimey.tumblr.com/

The data• The data in this report consists entirely of data I’ve gathered manually based on

publicly available, free sources• No paid data sources or API calls were harmed in the making of this dataset, every

investment was manually classified• This allows analysis of some aspects of the data I consider important – aspects that

don’t appear in other data sources. More importantly, it allows me to exclude deals that are really not “venture capital” rounds but tend to get included by others

• Seed investment is under-reported and adds a lot of noise to the data set, so I exclude deals under $500K

• The analysis is limited to ICT categories and excludes life sciences• The analysis excludes Turkey and FSU countries• All currencies converted into USD using monthly average exchange rates

Prepared by Gil Dibner follow me on (@gdibner), connect with me on , subscribe to my , or invest with me onblog 2





Top 10 deals by region in 2017 YTD (US $M)

France & Benelux IsraelIberia

UK & Ireland DACH Nordic


60

66

75

75

100

102

190

385

397

502

Babylon Health

Revolut

Darktrace

Kobalt

Funding Circle

Atom Bank

Neyber

Deliveroo

FarFetch

Improbable

0 200 400 600

50

50

53

70

90

120

128

165

404

423

Market Logic

NewStore

ResearchGate

SoundCloud

Lilium

Kreditech

Lampenwelt.de

Tricentis

Auto1

Delivery Hero

0 100 200 300 400 500

24

25

27

27

30

50

64

88

120

481

StarCounter

Min Doktor

24 Storage

MariaDB

Yubico

Collibra

iZettle

ForgeRock

Snow Software

Klarna

0 200 400 600

50

50

53

57

62

69

72

75

107

173

Leap Motion

Protix

Algolia

Shadow

Vestiaire Collective

Oodrive

Manomano

Actility

Picnic

Showroomprivee

0 50 100 150 200

60

65

70

75

75

76

84

85

100

250

StoreDot

Innoviz

SentinelOne

WalkMe

Kaminario

Vroom

Trax

Valens

CyberReason

Via

0 100 200 30010

10

11

12

20

22

28

35

100

175

OnTruck

Fever

Logtrust

Scytl

Verse

CornerJob

Fintronic

TypeForm

Cabify

LetGo

0 50 100 150 200





Top 10 deals by type in 2017 YTD (US $M)

Systems SaaSEnterprise

Consumer Financial Commerce


107

120

128

173

175

250

385

397

404

423

Picnic

Kreditech

Lampenwelt.de

Showroomprivee

LetGo

Via

Deliveroo

FarFetch

Auto1

Delivery Hero

0 100 200 300 400 500

41

45

48

50

58

66

100

102

120

190

Zopa

10x Future Technologies

Younited Credit

Receipt Bank

Credit Peers

Revolut

Funding Circle

Atom Bank

Kreditech

Neyber

0 50 100 150 200

33

39

40

62

76

107

128

173

385

397

Fritchi

CarWow

Lesara

Vestiaire Collective

Vroom

Picnic

Lampenwelt.de

Showroomprivee

Deliveroo

FarFetch

0 100 200 300 400 500

757575758488100

120165

190481

502

KobaltKaminario

WalkMeDarktrace

TraxForgeRock

CyberReasonSnow Software

TricentisNeyberKlarna

Improbable

0 200 400 600

20202021

2330

3350

5364

7590

Intuition RoboticsHealthwatch

HighconVulog

UltrahapticsVolocopterAirobotics

RimacArralisiZettle

KaminarioLilium

0 20 40 60 80 100

50

50

50

53

69

75

75

120

165

481

Market Logic

Collibra

Receipt Bank

Algolia

Oodrive

Kobalt

WalkMe

Snow Software

Tricentis

Klarna

0 200 400 600





Quarterly pace of venture investment

• In 3Q17, Europe & Israel saw $5.4 billion flowing into 455 venture transactions

• 2Q17 was a record-breaking quarter in terms of the amount invested

• The number of deals declined in 3Q and 2Q from a record number in 1Q

• These numbers, and the rest of this deck, do not reflect the $1B in debt raised by Spotify in March


1,703

1,916

2,873

3,139

3,252

2,857

3,730

4,114

3,122

3,520

4,072

5,790

5,476

0

100

200

300

400

500

600

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3

2014 2015 2016 2017

Amou

nt in

vest

ed (U

S $M

)

VC Investments in Europe & Israel

Invested amount (US $M) Number of investments

http://www.wsj.com/articles/spotify-raises-1-billion-in-debt-financing-1459284467





Monthly pace of venture investment

• Looked at on a monthly basis, the strength of 2Q and 3Q are even more pronounced

• May 2017 was a record-setting month in terms of investment volume

• September 2017 was a record-setting month in terms of the number of deals


905971997791787

1,5611,518

5711,1641,0841,059

7151,6571,0511,0211,4011,4521,261

7251,1011,2961,4581,170

8931,671

9431,458

8613,0141,8872,013

7512,712

0

20

40

60

80

100

120

140

160

180

200

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Jan

Feb

Mar

Apr

May Jun Jul

Aug

Sep

Oct

Nov De

cJa

nFe

bM

arAp

rM

ay Jun Jul

Aug

Sep

Oct

Nov De

cJa

nFe

bM

arAp

rM

ay Jun Jul

Aug

Sep

Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3

2015 2016 2017

Amou

nt in

vest

ed (U

S $M

)

VC Investments in Europe & Israel(January 2015 - September 2017)

Invested amount (US $M) Number of investments





Mega-rounds skew the investment totals• This analysis breaks down VC

investments into brackets by size:• Seed (less than $2M)• Early venture ($2-8M)• Venture ($8-20M)• Growth ($20-100M)• Mega ($100M+)

• 13 mega-rounds took place in Europe in 2Q17 and 3Q17

• Snow Software (Sweden, $120M)• Cabify (Spain, $100M)• Kreditech (Germany, $120M)• Improbable (UK, $502M)• Showroomprivee (France, $173M)• Delivery Hero (Germany, $423M)• Auto1 (Germany, $404M)• CyberReason (Israel, $100M)• Farfetch (UK, $397M)• Klarna (Sweden, $225M & $250M)• Via (Israel, $250M)• Neyber (UK, $152M)• Deliveroo (UK, $385M)

• Adjusting for mega-rounds, 3Q17 was a record quarter at $4.2B


592 708 759 741 707

752 650921 941 873

1,336 1,1961,395 1,567

2,473

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

Qtr3 Qtr4 Qtr1 Qtr2 Qtr3

2016 2017

Amou

nt In

vest

ed (U

S $M

)

Pace of VC Investment in Europe and Israel

Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8) Seed (.5-2)





Strong year-over-year growth

• All size brackets except seed saw YoY increases in 3Q17 compared to 3Q16

• Growth volume increased by 85%

• Mega-round volume increased by 359%


167 159592 707

752 873

1,336

2,473275

1,263

0

1,000

2,000

3,000

4,000

5,000

6,000

Qtr3 Qtr3

2016 2017

Tota

l VC

inve

stm

ent (

US $

M)

VC investment volume in Europe and Israel by bracket(3Q17 vs 3Q16)

Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8) Seed (<2)





Number of investments, by bracket

• Excluding seed deals, the total number of VC investments per quarter was very constant for the past three quarters: 318 in 1Q, 315 in 2Q, and 315 in 3Q

• The mix, however, seems to be shifting towards later-stage rounds


77 85 94140 153 157 144

182 195 186 17042

62 44

4661 57 64

5377 76

75

3326 38

35

44 5240

35

40 44 65

66 4

3

4 41

6

6 9 5

0

50

100

150

200

250

300

350


2015 2016 2017

Num

ber o

f VC

inve

stm

ents

VC investment volume in Europe and Israel by bracket

Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8)





No impact of Brexit on deal volume…

• Looking just at UK VC deal volume, there’s so far no evidence that Brexit caused any slowdown whatsoever in VC activity

• There were an average of 15 VC deals per month in the 18 months before the referendum

• There were an average of 23 VC deals per month since the referendum


0

5

10

15

20

25

30

35

40

JanFebM

arAprM

ayJunJulAugSepO

ctN

ovDecJanFebM

arAprM

ayJunJulAugSepO

ctN

ovDecJanFebM

arAprM

ayJunJulAugSep


2015 2016 2017

Num

ber o

f VC

inve

stm

ents

VC investment volume in the UK by bracket


Pre-Brexit

avg = 15

Post-Brexit avg = 23





…and no impact on dollars invested in the UK

• An average of $819M per quarter was invested in the UK in the 18 months before the referendum

• An average of $1,092M per quarter was invested in the UK since the referendum


74 70 98 79 136 108 133 150 189 162 178165 166 96 128

172 148 181 113 159 247 224

459180

405209

532

273 202 191149

514755210

150

275478

192

110275 202

899 538

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000


2015 2016 2017

Num

ber o

f VC

inve

stm

ents

VC investment volume in the UK by bracket


Pre-Brexit avg = $819M

Post-Brexit avg = $1,092M





Corporate VC activity, by bracket

• Excluding seed deals, the total number of corporate VC investments rose to 60 in 3Q17, tying 2Q16 for the record

• Corporate VC investments continue to trend towards later stage


6 4 516

7

22 19 23 1927 25 27 23

43

9

12

7

12

6

1619 5

17 1618

44

7

8

7

720

18

69

12 11 18

3

13

3

3

2 31

0

10

20

30

40

50

60

70

Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3

2014 2015 2016 2017

Num

ber o

f VC

inve

stm

ents

Corporate VC investment volume in Europe and Israel by bracket






Corporate VC activity, by country

• During 3Q17, the UK saw the highest number of corporate VC investments, with 17

• Israel saw 16 corporate VC investments during the quarter

• Germany came in third, with 7

• Sweden and France tied for fourth place, with 4 each


6

25

2 2

6

6

3

5

7

2

2

0

2

4

6

8

10

12

14

16

18

UK

Isra

el

Ger

man

y

Swed

en

Fran

ce

Switz

erla

nd

Finl

and

Nor

way

Spai

n

Croa

tia

Irela

nd

Esto

nia

Net

herla

nds

Num

ber o

f inv

estm

ents

Number of corporate VC investments in Europe and Israel by bracket(3Q17)






Average round size• This average excludes seed

rounds and mega rounds, so it reflects all rounds done in Europe & Israel between $2M and $100M

• With very few exceptions, most months saw average round sizes of $10-12M and there is seems to be little pattern other than mean reversion

• Until now, 3Q15 was the only systematic outlier to this trend, with average round sizes of $14M

• 3Q17 saw average round sizes jump up to $13M, from lows of sub-$10M in 4Q16 and 1Q17


4

6

8

10

12

14

16


2014 2015 2016 2017

Amou

nt In

vest

ed (U

S $M

)

Average investment size in Europe and Israel(Round sizes of 2-100M, and 6-month trailing average)





Total venture investment by country, 3Q 2017

• The UK saw the most VC investment in 3Q17, with $1.7B raised

• Israel came in second place, with $1.3B raised

• Sweden saw the third-highest amount of venture investment, with $658M

• France was a close fourth, with $645M


1,736

1,281

658

645

422

136

110

107

89

81

50

40

28

26

23

9

8

6

5

4

4

3

2

2

1

UK

Israel

Sweden

France

Germany

Ireland

Finland

Norway

Spain

Switzerland

Croatia

Netherlands

Italy

Cyprus

Denmark

Austria

Belgium

Hungary

Portugal

Estonia

Poland

Serbia

Malta

Iceland

Czech

Total VC investment volume by country, 3Q17 (US $M)





Rule Britannia!Total venture investment by country, 3Q15 to 3Q17

• To get a better sense of VC volumes in various countries, this analysis excludes mega-rounds

• With this filter, volumes and rankings are more consistent

• The UK leapt into first place, ahead of Israel which also saw a strong increase over 2Q

• Sweden’s steady rise (seven quarters of uninterrupted growth) reversed itself in 3Q


Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3

2015 2016 2017

0

200

400

600

800

1000

1200

1400

Tota

l VC

inve

stm

ent (

US $

M)

Total VC investment, 3Q15 - 3Q17 (top 5 countries, excluding mega-rounds)

IsraelUKFranceGermanySweden





Total venture investment by country, 3Q15 to 3Q17

• To get a better sense of VC volumes in various countries, this analysis excludes mega-rounds

• The “second five” countries for VC investment in 2016 were Spain, Ireland, the Netherlands, Finland, and Switzerland



2015 2016 2017

0

20

40

60

80

100

120

140

160

Tota

l VC

inve

stm

ent (

US $

M)

Total VC investment, 3Q15 - 3Q17(countries ranked 6-10, excluding mega-rounds)

Spain IrelandNetherlands SwitzerlandFinland





Total venture investment by region

• When VC investments across Europe are aggregated into regions, UK & Ireland, Israel, the Nordics, France, and DACH are the clear and consistent leaders

• Other regions do produce meaningful VC investments, but the volumes are still low


UK & Ireland, 1,872

Israel, 1,281

Nordic, 904

France, 645

DACH, 512

South. Eur., 110

Iberia, 94

Benelux, 48

East. Eur., 11

Total VC investment by region, 3Q17





Rounds by bracket & region

• To get a better sense of deal volume, this analysis excludes seed deals which are often poorly reported

• Excluding seed deals, the UK and Ireland saw 92 venture deals in the third quarter

• France came in second with 54

• Israel was right behind France with 53


4434

17

3221

10 7 2 3

21

12

16

11

11

1

25

8

195

5

12

1

2

0

10

20

30

40

50

60

70

80

90

100

UK &Ireland

France Israel DACH Nordic Iberia Benelux South. Eur. East. Eur.

Num

ber o

f inv

estm

ents

Number of investments in Europe and Israel by bracket, 3Q 2017






Participation rate of US VC firms, by bracket

• In the first quarter, US VCs participated in 9% of the VC financing rounds in EU and Israel

• As usual, US VCs are much more likely to participate in later rounds

• Unlike previous quarters, however, more mega-rounds happened without US VCs


2% 4% 12%

32%20%

98% 96%88%

68%80%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Seed (.5-2) Early Venture (2-8) Venture (8-20) Growth (20-100) Mega (>100)

Perc

enta

ge o

f rou

nds

Did US VC firms participate in European VC rounds? (3Q17)

No Yes





US VC firm participation rate drops in 4Q

• From 4Q16 to 3Q17, US VCs participated in about 12% of the rounds that took place in Europe

• This rate is the lowest since I’ve been tracking the data, but it appears to be stable

• This analysis excludes seed and mega-rounds


15%23% 17% 20% 20% 16% 16% 21% 21%

12% 12% 12% 12%

85%77% 83% 80% 80% 84% 84% 79% 79%

88% 88% 88% 88%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


2014 2015 2016 2017

Perc

enta

ge o

f Rou

nds

Did US VC firms participate in European VC rounds?(3Q14-3Q17)

No Yes





Participation of US VC firms by country

• In 3Q17, US VCs firms were active in 9 different European countries

• US VC firms were most active in Israel, where they participated in 15 investment rounds

• The UK saw 11 US investments

• US VCs invested in 4 French companies and 3 German companies


16

11

4 3 2 1 10

2

4

6

8

10

12

14

16

18

Isra

el UK

Fran

ce

Germ

any

Irela

nd

Finl

and

Nor

way

Switz

erla

nd

Swed

en

Num

ber o

f VC

inve

stm

ents

Rounds with a US VC involved(3Q17)





Participation of US VC firms by country

• This chart shows US VC activity within Europe

• The overwhelming bulk of US VC activity is generally in Israel, the UK & Ireland, DACH


0

10

20

30

40

50

60


2015 2016 2017

Num

ber o

f VC

inve

stm

ents

Investments with US VC participation

Israel UK & Ireland DACH Nordic France Iberia Benelux East. Eur. South. Eur.





Dimension Categories Explanation/Example

1. Target market Consumer, SMB, Enterprise, Government, Telecom, OEM

What sort of customer does the company target?

2. Vertical marketAdtech, Communications, Data, Development, Durables, Education, Electronics, Employment, Energy, Fashion, Financial, Food, Gaming, Health, HMI, Industrial, Infrastructure, Lifestyle, Logistics, Marketing, Media, Productivity, Real Estate, Security, Sports, Storage, Transportation, Travel, Water

What type of problem does the company solve?

3. Business modelCommerce, Components, Content, Marketplace, SaaS, Semiconductors, Services, Software, Systems,

How does the company makemoney? How is value delivered to customers? What are customers paying for?

For example: Consumer + Travel + Marketplace AirBnB is a travel-related marketplace for consumers

Three-dimensional approach to sector mapping






• Excluding mega-rounds, investment activity increased uniformly across target markets

What target markets are attracting the most VC investment in Europe & Israel?


1,177 931 1,076 1,244 1,097 1,002 1,0561,352 1,546

9101,110

1,6541,640

1,269962

1,6501,361

1,820275

224

270

283 220

244

182150

163 187

219447

255 406

531

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500


2015 2016 2017

Tota

l VC

inve

stm

ents

(US $

M)

European & Israeli venture financing by target market3Q15 to 3Q17 (excluding mega-rounds, US $M)

Agriculture

Government

Telecom

OEM

SMB

Enterprise

Consumer





• When Israel is excluded from the sample, 45% of all VC dollars in Europe went to enterprise-oriented companies in 3Q

• In 2Q 2017, there was a spike in consumer-focused investments

Shifting towards enterprise?


62%

36%

56% 63% 62% 57% 53% 58% 53%45% 46%

58%

41%

18%

48%

34% 22% 24% 31% 36%33%

32%

29%36%

32%

45%

6%10% 4% 12% 8% 6% 5% 3%

7%

8%

12%3%

6%5%4% 2% 4% 5% 6% 5% 8%

10%

5% 5% 7%6% 6%8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


2014 2015 2016 2017

European venture financing by target market3Q14 to 3Q17 (excluding Israel, percent of US $M)

Agriculture Government Telecom OEM SMB Enterprise Consumer





Breakdown by region & target market

• Regional differences are very apparent when VC investment are categorized by target market

• In 3Q17, the Nordics evidenced a strong emphasis on enterprise investments

• Unlike previous quarters, Israel was more balanced, with a sizeable percentage of consumer-oriented investments


875

457

135308 248

772

575

674179 174

110113

224

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

UK &Ireland

Israel Nordic France DACH South.Eur.

Iberia Benelux East. Eur.

Tota

l am

ount

inve

sted

(US $

M)

Investment in Europe and Israel by target market by region3Q17 (US $M)






Distribution of investment rounds by country

• Across Europe & Israel, 45% of VC investment rounds were in consumer companies in 3Q17

• Over two-thirds of Israeli venture investments were into enterprise companies

• France and DACH skewed towards consumer

• The UK, Ireland, and Nordics skewed towards enterprise


18%

42%

43%

50%

50%

52%

56%

73%

64%

32%

41%

33%

21%

30%

30%

18%

12%

9%

8%

21%

11%

6%

13%

11%

6%

4%

7%

5%

6%

4%

5%

9%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Israel

Nordic

UK & Ireland

Iberia

Benelux

DACH

France

South. Eur.

Investment in Europe and Israel by target market by country3Q17 (Number of investments)

Consumer Enterprise SMB OEM Telecom Government Agriculture





Growth rounds by target market

• Enterprise companies accounted for just under half of the later-stage market in Europe & Israel in 3Q17


56%

37%46%

56%43% 39% 38% 43% 44%

34% 37%45%

33%

25%

41%

46% 25%38% 50% 50%

50% 44%

32%

50% 36%49%

6% 7%

5%

9% 12%3% 6% 5%

12%

7%4% 4%

6% 11% 6% 7% 5% 6% 5% 5%20%

7%13% 14%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


2014 2015 2016 2017

Investment in Europe and Israel by target market(Rounds over $20M, number of investments)






• Fintech was the most popular vertical across Europe & Israel, with 48 investments in the category

• Marketing tech was a distant second with 31

• Lifestyle (a catch-all category for consumer commerce) was tied with Electronics for third, with 26

Finance returned to being the top vertical


444

55

666

78888

911

121313

151515

1718

1919

2021

222626

3148

ERPHMISCMCRM

AgtechGaming

FoodLegal

CommunicationsIndustrial

ProductivityFashionAdtech

SocialDevelopment

EnergyAutomotive

PaymentsTravel

DataEducation

Real EstateLogistics

EntertainmentEmployment

SecurityHealth

InfrastructureLifestyle

ElectronicsMarketing

Financial

European & Israeli venture financing by target market3Q17 (top 30 categories, number of investments)





• This graph shows the change in the number of investments by vertical from 3Q16 to 3Q17

• Entertainment, health, employment, and payments saw the biggest increases in VC investment

• Industrial, Communications, Adtech, and Fashion saw the biggest decreases

Growth rates by vertical


Industrial, -50%Communications, -46%

Adtech, -43%Fashion, -43%

Security, -13%Lifestyle, -7%

Travel, -6%Marketing, 15%Data, 15%

Logistics, 20%Infrastructure, 29%Automotive, 30%

Education, 36%Electronics, 37%

Financial, 45%Energy, 50%

Payments, 63%Employment, 111%

Health, 133%Entertainment, 171%

-100% -50% 0% 50% 100% 150% 200%

Change in the number of venture investments(3Q17 vs 3Q16, 20 most popular categories)





• Finance was once again the most frequently funded vertical

• Marketing (mostly for enterprise, but some SMB) took second place

• Consumer lifestyle and electronics (split between consumer and OEM) tied for third place,

Which verticals for which segments?


Logistics

Employment

Entertainment

Security

Health

Infrastructure

Lifestyle

Electronics

Marketing

Financial

0 10 20 30 40 50 60

European & Israeli venture financing by target market3Q17 (number of investments, top 10 verticals)

Consumer

Enterprise

SMB

OEM

Telecom

Agriculture





• This chart shows the ten most commonly funded verticals across Europe & Israel by quarter

The most popular verticals in the past 2 years



2015 2016 2017

0

50

100

150

200

250

300

350

European & Israeli venture financing by vertical market(number of investments, top 10 verticals)

Adtech

Health

Logistics

Electronics

Lifestyle

Employment

Security

Infrastructure

Marketing

Financial





• Investors continue to favor financial, and lifestyle

• Travel bounced back in 3Q• Entertainment (non-gaming)

showed new strength, with a slew of investments in media businesses

• Health and gaming declined in 3Q

Consumer VC investment trends



2015 2016 2017

0

20

40

60

80

100

120

140

160

180

European & Israeli venture financing by consumer verticals(number of investments, top 10 verticals)

EntertainmentTravelHealthFashionFoodElectronicsLogisticsGamingLifestyleFinancial





• Marketing, security, and infrastructure showed continued strength

• Ad tech, employment/HR, and fintech verticals show a decline

Enterprise VC investment trends



2015 2016 2017

0

20

40

60

80

100

120

140

160

180

European & Israeli venture financing by enterprise verticals(number of investments, top 10 verticals)

CRM

Financial

Industrial

Employment

Development

Data

Infrastructure

Adtech

Security

Marketing





• Services displaced SaaS as the most funded business model in 3Q17, representing 24% of all VC dollars

• SaaS took 22% of the venture dollars invested in Europe & Israel

• Systems – complete physical products – took fourth place at 9% of all venture dollars

SaaS above all (but keep an eye on systems)


Services, 1,020, 24%

SaaS, 972, 23%

Software, 771, 18%

Systems, 365, 9%

Commerce, 273, 7%

Components, 262, 6%

Marketplace, 248, 6%

Media, 188, 4%

Semiconductors, 108, 3%

Materials, 8, 0%

European & Israeli venture financing by target market3Q17 (in US $M) (excluding mega-rounds)





• Services and SaaS remained the top two business models by funding volume

• Software rebounded in 3Q• Systems maintained their

fourth place ranking

Commerce disappears and systems rise


0

200

400

600

800

1000

1200


2015 2016 2017

European & Israeli venture financing by business model(top seven, in US $M, excluding mega-rounds)

Services

SaaS

Software

Commerce

Marketplace

Systems

Media





• This graph provides a quick overview of the ten most commonly funded segments across the top ten countries for those segments

• In a nutshell:• Consumer financial services

(Everywhere, but especially in the UK)

• Marketing SaaS in the UK, France, and Sweden

• Israeli enterprise security software

• Consumer entertainment media• British and French consumer

lifestyle• Israeli and British infrastructure• French consumer electronics• And some other stuff….

EU+IL VC Cheat Sheet (1Q17)






• Finance was the most commonly funded category in Israel, with 57 investments in 2017

• Real estate, marketing, and lifestyle were next

A closer look at UK venture in 2017 YTD


Data

Education

Health

Security

Infrastructure

Employment

Lifestyle

Marketing

Real Estate

Financial

0 10 20 30 40 50 60

UK venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





• Security was the most commonly funded category in Israel, with 32 investments in 2017

• Automotive jumped to second place, tied with marketing

• Infrastructure and health tied for third

A closer look at Israeli venture in 2017 YTD


Financial

Logistics

Electronics

Development

Data

Health

Infrastructure

Marketing

Automotive

Security

0 5 10 15 20 25 30 35

Israeli venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM

Agriculture





• Fintech was the most commonly funded category in Sweden, with 19 investments in 2017

• Entertainment and electronics were next

• Lifestyle and gaming tied for fourth

A closer look at Swedish venture in 2017 YTD


Energy

Payments

Employment

Health

Marketing

Gaming

Lifestyle

Electronics

Entertainment

Financial

0 2 4 6 8 10 12 14 16 18 20

Swedish venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





• Lifestyle was the most commonly funded category in Israel, with 31 investments in 2017

• Electronics and finance were next

A closer look at French venture in 2017 YTD


Food

Health

Adtech

Marketing

Infrastructure

Logistics

Employment

Financial

Electronics

Lifestyle

0 5 10 15 20 25 30 35

French venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





• Finance was the by far most commonly funded category in Germany, with 24 investments in 2017

• Consumer lifestyle was next• Food and electronics tied for

third

A closer look at German venture in 2017 YTD


Automotive

Payments

Marketing

Employment

Infrastructure

Travel

Health

Electronics

Food

Lifestyle

Financial

0 5 10 15 20 25 30

German venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





• Education was the most commonly funded category in Ireland, with 3 investments in 2017

A closer look at Irish venture in 2017 YTD


HMI

Industrial

Data

Logistics

CRM

Payments

Lifestyle

Legal

Infrastructure

Marketing

Employment

Development

Health

Financial

Communications

Education

0 1 2 3 4

Irish venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





• Gaming was the most commonly funded category in Finland, with 8 investments in 2017

• Industrial and electronics were next

A closer look at Finnish venture in 2017 YTD


Data

Energy

HMI

Education

Entertainment

Marketing

Health

Electronics

Industrial

Gaming

0 1 2 3 4 5 6 7 8 9

Finnish venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





• Consumer lifestyle was the most commonly funded category in Spain, with 9 investments in 2017

• Financial was second• Logistics and health tied for

third

A closer look at Spanish venture in 2017 YTD


Electronics

Education

Social

Employment

Infrastructure

Travel

Health

Logistics

Financial

Lifestyle

0 1 2 3 4 5 6 7 8 9 10

Spanish venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM

Telecom

Government





• Financial was by far the most commonly funded category in Switzerland, with 6 investments in 2017

• Interestingly, there were two space-related investments in Switzerland

A closer look at Swiss venture in 2017 YTD


Health

Communications

ERP

Food

Employment

Real Estate

Legal

SCM

Infrastructure

Data

Electronics

Payments

Automotive

Space

Financial

0 1 2 3 4 5 6 7

Swiss venture financing by target market2017 YTD (number of investments, top verticals)

Consumer

Enterprise

SMB

OEM





Focus on Health Tech

• 2017 is witness to a dramatic rise in the number of health tech investments across Europe and Israel

• This is happening across the geography






Focus on Employment/HR

• 2017 is also seeing an increase in Employment/HR startup investment

• Activity in France and the UK was the main driver here






Focus on Data

• The UK, France, and Israel continue to see investment into data startups (big data, analytics, and databases)






Based in , I was previously a partner at . Before that, I helped run the

European seed program for . I moved to London after seven years in

during which I worked as a VC with and . I’m originally from .

My VC investments include and . Angel investments include and many more.

If you found this useful, I hope you’ll subscribe to my blog.51

Gil Dibner

To invest in the best European & Israeli enterprise startups,

consider backing me on here. Lots of exciting stuff in thepipeline – and you’ll be in pretty good company.

https://twitter.com/gdibner/lists/announced-portfolio/members

http://yankeesabralimeysignup.myinstapage.com/


Thank youblog





Technology

Europe & Israel 3Q17 Venture Capital Review