Swedish Tech Funding
Report Q1-Q2 2017
Industrifonden is a Nordic evergreen venture capital investor with $500M in
assets, partnering with early-stage tech and life science companies with
international potential. Industrifonden-backed companies include Qlik, Arcam,
Soundtrack Your Brand, Fishbrain, Qapital and Funnel
#swedishtechreport
@Industrifonden
www.Industrifonden.com
OVERVIEW
Disrupted bankers and digitized doctors –
2017 keeps the fire burning
In the first half of 2017 we experienced a continued Q2 by Kry and MinDoktor’s $20M+ rounds from investors
growth in deployed capital, while last year’s strong including Accel, Index Ventures and EQT Ventures.
increase in number of deals leveled off. This was
primarily driven by a slight decrease in seed rounds and To peg companies up for coming growth rounds, angel
investors remain crucial to the ecosystem and in this
an uptick in Series A and B rounds.
edition we have taken a closer look into the space. An
Interestingly, despite the continued growth of invested analysis of the 20 most active angel investors in Sweden
capital and the upwards shift of round sizes, the share of reveals that there is plenty of smart money to go around,
funding rounds with participation from international as a vast majority of the investors are former founders.
investors decreased to 15%. This is the lowest share Together they are bringing experience from raising
since we started this tracking and points to a strong massive VC rounds and creating a combined $15+ billion
domestic funding climate, even for bigger size tickets in exit value.
beyond Series A rounds. Of the international investors
that did invest in Sweden, UK investors were the most
bullish and claimed the top spot for the first time, racing
past their American peers.
Just like in previous years, the most popular sector for
venture funding was FinTech which cemented its position
in the top. More interesting to note, however, was this
year’s runner-up sector Digital Health, which has risen
from being virtually non-existent just a few years ago to Björn Bergström
now gaining massive interest. This was manifested in Q1 Tech Investor
through AMRA’s $9M funding from investors including
Industrifonden
Pfizer Ventures, Industrifonden and Novo Nordisk, and in
3
KEY FIGURES
222
Funding rounds (Q3-Q4 2016: 224)
$560M
(SEK 4.9B) raised (Q3-Q4 2016: $390M)
340
Active investors (Q3-Q4 2016: 349)
INVESTMENT ACTIVITY
Stabilized levels in number of rounds –
continued increase in invested capital
$M
Deal count
$M
Total investment*
2
140
1200
1110
120
1000
1,5
1,4
100
1,2
1
0,8
0,7
0,7
0,7
1
1
0,8
80
20
0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2015 2015 2015 2015 2016 2016 2016 2016 2017 2017
Median deal size
4
277
300
800
211
200
700
600
169
102
200
179
150
400
233
134
104
102
179
211
Q3
2016
Q4
2016
277
281
281
233
250
60
40
0
Total investment, outlier adjusted*
$M
104
117
134
100
50
0
0
Q1
2015
Q2
2015
Q3
2015
Q4
2015
Q1
2016
Q2
2016
Q1
2017
Deal count
Note: The outlier adjusted graph excludes Spotify’s funding rounds in Q2 2015 and Q1 2016 to provide a more comparable trend line than the total investment graph
Q2
2017
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2015 2015 2015 2015 2016 2016 2016 2016 2017 2017
INVESTMENT ACTIVITY
Early stage has stabilized after previous years’
explosive growth – later stage sees slight increase
Deal count
70
62
61
60
50
50
47
45
44 43
42
41
40
40
32
29
30
26
20
19
20
15
11
10
27
8
12
10
9 9
6
2
4
10
4 4
3
1 2
1 1
1
0
<$1M
2015 - Q1
5
2015 - Q2
$1.1-5M
2015 - Q3
2015 - Q4
$5.1-25M
2016 - Q1
2016 - Q2
2016 - Q3
0 0
>$25M
2016 - Q4
2017 - Q1
1 1 1
Deal size
2017 - Q2
INVESTOR ACTIVITY
Active investors
-3%
400
Change in active investors Q1-Q2 2017 compared to
Q3-Q4 2016
250
349
340
Q3-Q4 2016
Q1-Q2 2017
350
310
300
200
15%
Of the active investors participated in at least two
funding rounds during Q1-Q2 2017
6
146
150
105
100
50
0
Q1-Q2 2015
Q3-Q4 2015
Q1-Q2 2016
INVESTOR ACTIVITY
Angel investors and VCs remain most
active backers of tech startups
3% 3%
Investor type by
% of deals
Q1-Q2 2017
6%
Angel
12%
Share of deal count by investor type
100%
75%
VC
60%
Investment firm, other
56%
Corporation
56%
56%
51%
47%
50%
37%
Corporate VC
20%
Accelerator
29%
20%
25%
23%
20%
0%
Angel investors
Q1-Q2 2015
7
Q3-Q4 2015
VC
Q1-Q2 2016
Q3-Q4 2016
Q1-Q2 2017
FOREIGN INVESTMENT ACTIVITY
Domestic investors continue to dominate
funding rounds
Funding rounds with foreign participation (%)
Funding rounds with foreign participation (count)
100%
75%
47
50%
42%
29
25%
25%
18%
33
32
27
21%
15%
0%
Q1-Q2 2015
8
Q3-Q4 2015
Q1-Q2 2016
Q3-Q4 2016
Q1-Q2 2017
Q1-Q2 2015
Q3-Q4 2015
Q1-Q2 2016
Q3-Q4 2016
Q1-Q2 2017
FOREIGN INVESTMENT ACTIVITY
…even beyond seed stage where foreign
investors typically enter
Deals with foreign
participation (%)
100%
Deal count
100%
100
90
80
75%
70
60
45%
50%
50
40
30
25%
16%
20
10
5%
0%
0
≤$1M
$1.1 - 5M
Foreign participation %
9
$5.1 - 25M
Total deal count
>$25M
FOREIGN INVESTMENT ACTIVITY
While overall foreign investment slowed, UK
investors claimed top spot after doubling their share
Foreign participation 2015
6%
7%
33%
10%
19%
USA
UK
RoW
Germany
Finland
Denmark
6%
USA
4%
7%
UK
29%
Germany
Norway
10%
10
18%
4% 4%
4%
4%
Rest of World
Denmark
9%
18%
25%
Foreign participation Q1-Q2 2017
Foreign participation 2016
Finland
China
38%
6%
6%
8%
8%
18%
UK
USA
Norway
Rest of World
Denmark
Finland
Netherlands
Germany
Spain
Iceland
VERTICALS
FinTech remained hottest sector, while Digital Health
claimed the runner up position for the first time
Top 2 verticals by deal count
11
13%
10%
FinTech
Digital Health
FUNDRAISING TRENDS
In the spotlight: Top 20 angel investors
The rundown on Sweden’s most active angel investors Q1-Q2 2017
Investment data
3
Average no. of investments during
Q1-Q2 2017
35%
Of the top 20 angel investors also
featured in the top 20 in 2016 and / or
2015
12
Professional background
Educational background
60%
65%
Founders
Business
30%
30%
Executives
Tech / Engineering
10%
5%
Artists & Athletes
Other
Previous achievements
$15B+
Total realized exit value during the angel
investors’ active operational careers
35%
Have founded a VC-backed company
METHODOLOGY
What’s included
•
•
•
•
13
This report covers disclosed venture investments in
Swedish private tech companies
Analysis primarily based on proprietary database with 600+
funding rounds
Both first-time and follow-on investments are included
Deals are tracked in SEK but reported here in USD. If
originally reported in other currencies, conversion is based
upon exchange rate per date of disclosure. Aggregate
figures are subject to change due to currency fluctuation
What’s not included
•
•
•
•
Investments in life science, med tech, bio tech, retail,
and consulting
Secondary transactions, investments in subsidiaries and
M&A transactions
Equity crowdfunding and investments in public
companies of any kind, including listing rounds in
conjunction with IPO’s
Grants, bonds, bank loans and any other types of
funding that is not intended to result in ownership
An end-note to keep our lawyers happy: The information contained in this report has not been independently verified as to its accuracy. No representation or warranty, express or implied, is given by Industrifonden or any of its
directors, partners, officers, affiliates, employees, advisers or agents as to the accuracy or completeness of the contents of this report or any other document or information supplied or any opinions or projections expressed
herein or therein, nor is any such party under any obligation to update the report or correct any inaccuracies or omissions in it which may exist or become apparent.