Now, this is one I've both been looking forward to and dreading at the same time ever since I started doing these analyses at the beginning of 2014. The one where Spotify come along with a MEGA-round and mess up all of my charts and analysis.....
As aways, this analysis was based upon our own proprietary data collection of funding and exits in the region, using a wide variety of sources including local media, monitoring press releases and relying on our own network across the Nordics. Our data is also supplemented and cross referenced by sources including Tech.eu and Crunchbase.
In Q2 Nordic tech startups saw 70 investments totalling an incredible $812.8M ($526M to Spotify)
Due to Spotify's round it makes no sense to look at what percentage of the total money each country saw come in (but for those interested, Sweden took 81.63%) so instead I broke it down in terms of how many investments each country saw from the 70 in the Nordics in Q2.
Sweden still dominated proceedings however, with 35 of their tech companies receiving investment in Q2, and therefore 50% of all Nordic investments that quarter. Finland took second place (16) ahead of Denmark (11), while Norway saw 6 compared to Iceland's 2.
One of the few areas that Spotify's monster round doesn't really affect is the breakdown of investments by stage:
Noticeably, there were no Series C rounds, something that was reflected in Europe as a whole in Q2. However, overall, Q2 looked a lot healthier than Q1 did in terms of a decent spread of stages, with 57.38% of investments at Seed compared to Q1's 72%, with a lot more Series A rounds happening.
So, other than Spotify, who else raised a big amount of money in Q2?
Unsurprisingly, Trustpilot's $73.5M Series D comes in behind Spotify, with Swedish e-commerce players Mathem ($25M ) and Clothes ($17.75M) following them. Enevo's $15.8M was the biggest Series B in Finland since Supercell's, while one Finnish company (OnBone) and four Swedish companies (Magine, Soundtrack Your Brand, InRiver, Cryex) make up the rest of the top 10.
As for where the money was going in terms of verticals, it was pretty much business as usual:
Health had a very strong quarter with 8 health startups receiving investment, and behind them the other usual suspects of Enterprise SaaS and Fintech followed (quite far) behind. It's worth noting that 5 of the 8 health investments were in Finnish companies. Audio and Beacons are the 'newcomers', with the continued success of audio-based startups that have originated from the Nordics (and Sweden in particular) having some influence here.
Now let's take a look at the breakdown by stage and the top 3 biggest investments in Q2 for Denmark, Finland, Norway (just the top 3 investments) and Sweden:
What did the average round size look like in Q2? (We've left out late-stage for obvious reasons)
The average seed round was slightly lower than Q1's ($1.28M) but Series A was significantly higher in Q2 ($5.26M vs. $4M). It should be noted that there were only two Series B rounds raised in Q2, so not too much emphasis should be placed on the average here.
It's obvious that 2015 has seen more investment than 2014 did at this stage of the year, in fact we've already easily surpassed the whole year's amount in 2014, but how do the number of investments compare?
It's not just down to Spotify that 2015 is doing so well in comparison to 2014, the number of investments are greatly higher at this point of the year than they were at the same point in 2014 too, pointing to increased interest in the Nordic startup scene, and a higher amount of available capital.
And it's not just Q2 that performed so strongly, back in Q1 we predicted (even without knowledge of Spotify's monster round) that the Nordics would go on to easily surpass $1 billion in venture capital raised in 2015, and would most likely raise around $1.5 billion in total. With half of the year now gone, our first prediction came true, now we'll see about the second, but as Q2 demonstrates it's certainly looking more than achievable.
If you enjoyed or found value in this analysis then you can support The Nordic Web by becoming a member and enabling us to keep covering the region in detail (you can pay whatever you like and you get members-only benefits such as this!)