Though the COVID-19 pandemic hasn’t completely eased all over the world, several tech startups in Europe have already started focusing on their growth. Besides, many promising tech startups have also secured funding and are focused on their expansion.
European tech startups weekly
As a part of a weekly roundup, here is a list of some of the most important tech startups that have hit the headlines in Europe this week.
Intelligent visual assistance for customer support
Israeli-based TechSee, an intelligent visual assistance company, has raised $ 30M (approx €25.6M) in its Series C round for funding co-led by OurCrowd, Salesforce Ventures, and TELUS Ventures with participation from Scale Venture Partners and Planven Entrepreneur Ventures.
TechSee was founded in 2015 by Eitan Cohen, Amir Yoffe, and Gabby Sarussi. It is a technology and technical support company that specialises in visual technology and augmented reality (AR). The company’s technology combines AI with deep machine learning, proprietary algorithms, and big data to deliver a scalable cognitive system that becomes smarter with every customer support interaction.
The company offers a smart visual interactive platform that enables its users to interact with their customers through a live virtual channel and guide them using AR and annotations.
A startup that provides anti-counterfeiting solutions
An Austrian-based technology startup that provides anti-counterfeiting solutions, Authentic Vision, has raised $ 5M (approx €4.2M) in its Series B round of funding from Custos Privatstiftung (Austria), Dolby Family Ventures (USA), Gronova Vision (UAE), TAKKT AG (Germany), and business angels.
Founded in 2012 by Thomas Weiss, Authentic Vision provides anti-counterfeiting and authentication technologies to protect businesses as well as end consumers. The company’s holographic fingerprint tag, mobile authentication app, and real-time analytics capabilities protect physical assets from counterfeiting and alert brand and product owners to potential fraudulent activity.
Fintech startup raises €4.3M
Brussels-based fintech startup Keyrock has raised €4.3M in a fresh round of funding from SIX Fintech Ventures and MiddleGame Ventures. Existing investors Volta Ventures, Seeder Fund, and TNN Patrimony also participated in this round.
The company aims to accelerate its efforts to build efficient markets for digital assets.
Founded in 2917 by Jeremy De Groodt, Juan David Mendieta, and Kevin de Patoul, Keyrock develops crypto-asset financial infrastructure. It uses in-house algorithmic trading bots and high-frequency trading infrastructure to supply market making and liquidity services to the cryptocurrency ecosystem.
Apple acquires AI startup for €42.8M
USA-based technology company Apple has reportedly acquired an artificial intelligence startup Vilynx for approximately €42.8M, which Apple plans to use to improve Siri and other apps. Currently, the Vilynx website is inactive.
Founded in 2011, Vilynx provides APIs to develop dashboards that deliver information about how viewers consume videos, including which portions of the video have the most views and which are not getting attention. Thus Vilynx delivers a strong vertical solution for media and entertainment (digital content) that provides extremely relevant and unique information to maximize audience engagement and increase ad revenue.
According to the report, the acquisition will also deepen Apple’s AI expertise, as 50 engineers and data scientists will be joining from Vilynx, and the startup’s Barcelona office set to become one of Apple’s key AI research hub in Europe.
New €650M fund
European firm EMH Partners (EMH) has raised €650M for its Growth Fund II focused on midsize companies across the DACH region of Germany, Austria, and Switzerland.
The first Growth Fund, which was closed in 2017, was about €350M. EMH is thus expanding its successful medium-sized company strategy.
EMH Partners is an owner-led investment firm by entrepreneurs for entrepreneurs. The private equity company has invested mainly in the DACH region and supports the growth of Mittelstand companies with capital, digitalisation, and expansion expertise. EMH Partners invests in market-leading, owner-managed companies to accompany them in partnership during the next growth phase. Currently, it manages more than €1B of committed capital.
Israeli cyber defense company raises €21.4M
The Israeli-based cyber defense company, Toka, has raised $ 25M (approx €21.3M) in its Series B round of funding led by Eclipse Ventures. Existing investors including Andreessen Horowitz, Dell Technologies Capital, Entree Capital, and others also participated in this round.
Toka was founded in 2018 by Alon Kantor, Kfir Waldman, and Yaron Rosen. The company helps trusted government, law enforcement, and security agencies keep citizens safe and defend against terror and crime by developing cutting-edge and lawful intelligence-gathering tools.
According to the company, its software platforms are simple to use, scale quickly, and offer complete operational control to enable smarter, faster, and easier investigations and operations.
By empowering agencies with these intelligence capabilities, Toka helps governments maintain a technological edge to enhance their operational effectiveness and save lives.
The raised capital will be used to further Toka’s efforts to develop lawful intelligence-gathering platforms and products and advise governments on building an integrated cyber defense.
Protein from chickpea
Based in Raanana, north of Tel Aviv InnovoPro, the plant-based ingredients innovator specialising in innovative chickpea proteins, has raised $ 18M (approx €15.3M) in a fresh round of funding.
The Rabo Food & Agri Innovation Fund, part of Rabobank’s investment arm Rabo Corporate Investments, joined InnovoPro’s B round funding.
The deal was led by Jerusalem Venture Partners (JVP), Israel’s leading VC fund, and also included in its second closing ICOS Capital, collaborative VC firm, and iAngels, Israel’s influential angels investment platform.
InnovoPro was founded in 2015 by Dr. Ascher Shmulewitz. The company developed a proprietary extraction process to concentrate protein from chickpea, a functional protein that can be served as a clean label enabler for plant-based products including dairy-free yogurts, vegan ice cream, veggie burgers, and energy bars.
The company claims to the only one in the world to develop and launch a revolutionary 70% protein concentrate from chickpeas, with exceptional properties of a neutral taste, high functionality, and high nutritional values.
Cloud Trust Platform for organisations
Odaseva, a San Francisco-based Enterprise Cloud Trust Platform for organisations with business-critical cloud deployments, has raised $ 25M (approx €21.3M) in its Series B round of funding. This brings the company’s total funding to $ 40M (approx €34.2M).
The round was led by Eight Roads Ventures with new investor F-Prime Capital as well as participation from existing investors Partech, Salesforce Ventures, and Serena.
The company will use the funds to further develop its core Enterprise Cloud Trust Platform offering, supporting platforms including Salesforce, Microsoft 365, and more. It will also accelerate hiring in its San Francisco, Sydney, and Paris offices. Besides, the company will also invest in an ecosystem of users and partners, extending the long-standing commitment to develop & teach the best practices of enterprise cloud data protection.
Launched in 2012 by Sovan Bin, Odaseva is a unified cloud data protection, compliance, and operations platform for enterprises running Salesforce. The company delivers enterprise-class data governance, providing data protection (backup and recovery, archiving, governor limits monitoring), data compliance for regulatory requirements such as GDPR and data operations (Salesforce DX data extensions).
Featured image credit: Rawpixel.com/Shutterstock
A few notes before we get into this. One, we have a bonus episode coming this Saturday focused on this week’s earnings reports. And, second, we did not record video this week. So, if you like watching the show on YouTube, this is not the week for that!
- The huge COVID-related hit that public markets took this week, with tech getting hit extra hard.
- An antitrust brouhaha! As the Vista-Plaid deal and others gets a hard look, we wondered what it could all mean for startups were a bit more suited for M&A than an IPO.
- Up next we dug into how founders are raising money before they even quit their jobs, a trend that Natasha is digging into.
- From there it was a Danny segment, riffing on his 2020s piece, and dive into where he sees the most ripe chances for startups to truly change the world. We just hope the capital follows the opportunities.
- Then it was time to talk accelerators, with Natasha detailing on the Indie Bio class, and my taking of the show through some recent Techstars companies.
- VCs raised too, with the three of us talking about The Engine and Impact America raising fresh new funds.
- And then we chatted about the Yuanfudao round, and a Series B that The Wanderlust Group just put together.
We capped off with the latest from R2c, and then got the hell off the mics. Catch you all Saturday, and then back to regular programming on Monday morning.
For years, business founders in Europe have marveled at the caliber of the American tech companies emerging from Silicon Valley. Well, now the time is changing! The European tech landscape is expanding rapidly, signaling the start of a golden age of European tech entrepreneurship.
Europe tech sector value skyrockets
According to the latest report produced by Dealroom for Index Ventures, Europe’s tech sector is worth four times what it was five years ago, having lept from €155B in 2015 to €618B in 2020. The new data produced by Dealroom for the “Not Optional – Making Europe the Most Entrepreneurial Continent” summit – an event hosted by Index Ventures and Slush, reveals that the value of European tech companies has increased rapidly. The value of European tech companies skyrocketed by 46% in 2020 alone.
As of October 2020, a third of the combined value of companies is based on the top 10 leading tech businesses in Europe: Adyen, BioNtech, Delivery Hero, Klarna, Spotify, Ocado, HelloFresh, Takeaway.com, UiPath, and Zalando, says the report. The value of the top 10 companies has surged from €123B in January 2020 to €215B in October 2020.
The research also highlights the fact that 38% of global seed-stage capital is now raised by European startups. Notably, Europe received around 16% of global VC in 2019, a 10% increase from 2018. Since 2005, Europe has created 205 unicorns also.
Job growth is rising at 10% YoY
Amid the COVID-19 pandemic, Europe’s tech sector continues to expand and create employment opportunities for people across Europe, adds the report. Around 2M people have been employed in the European tech scene in 2020, which is a 43% increase from 2016. Also, the startups are experiencing a 10% growth in job creation YoY.
Various industries like e-commerce, health tech, fintech, and food sectors are expected to expand. Provided this growth rate continues, as many as 3.2M people will be employed in European tech by as soon as 2025. The key stats in the report shows that 73% of European tech jobs are generated by 4,900+ startups.
According to the report, founders, and early employees from Europe’s largest firms, including Skype, Spotify, Lovefilm, and Klarna are fuelling the next generation of startups, scaleups, and unicorns.
- Taavet Hinrikus, Skype’s former director of strategy, founded TransferWise in 2010 (valued at $ 5B (approx €4.2B) in July 2020).
- Niklas Zennström, Skype co-founder, is CEO and founding partner of Atomico.
- Alex Chesterman, the co-founder of LoveFilm and Zoopla, is CEO and founder of Cazoo.
“Just as a small group of alumni from PayPal went on to create a new generation of companies, Europe’s founders from companies like Spotify, Adyen and Skype have helped fuel a generation of entrepreneurship across Europe. They are continuing to create and invest in tens of new companies, helping to bring Europe to a new level of maturity. Europe has the talent, experience, funding and ambition to become one of the most entrepreneurial places on the planet,” says Peteris Zilgalvis, head of unit, “Digital Innovation and Blockchain”, DG CONNECT, European Commission.
On top of that, many European tech alumni have become active investors including Spotify founder Daniel Ek who has pledged to invest $ 1B (approx €4.2B) in European startups. The former LoveFilm alumni including Saul Klein and Alex Chesterman are both involved in funding the next-generation of tech companies, and in founding them.
European VCs break record
European VCs have raised record-breaking amounts of new funds, year-on-year, since 2015. The VC investment in Europe reached a new record high of €10.2B across 1,024 deals in Q3, 2020. Despite COVID-19, European VCs are on course to continue this record-breaking trend in 2020 by raising a total of €13B by the end of the year.
Talking about European companies, according to this report, they have raised €29B in 2020 so far – expected to reach €35B by the end of the year. A decade ago, just 20% of unicorns were backed by venture capital, but in 2019, nearly 82% unicorns were backed by VCs. This indicates that the European tech system is becoming more dependent on venture capital.
Many European companies still depend on foreign sources of capital, particularly as they grow in size and scale. Around 39% of total funding for European startups comes from outside Europe. For funding rounds above $ 100M (approx €85M), this proportion rises to 60%.
The data also reveals that the European startups need at least three times more capital than the amount raised by local VCs in recent years. In 2019, European VCs raised €13B, yet €38B was invested in European startups; the difference coming from foreign investors.
Consequently, as European tech companies grow in size over the next decade, the funding gap between what startups need to raise, and what is available in Europe becomes more evident.
Neil Rimer, co-founder of Index Ventures comments, “As Europeans, we need to do more to harness the energy and creativity of entrepreneurs, investors, and policymakers and ensure that they work together to usher in Europe’s tech-driven future. Europe will benefit from the innovation, growth, and jobs that this will bring, but only if it makes supporting startups a strategic priority across the continent that is essential — not optional.”
Main image credits: koya979/Shutterstock
Outrider, a startup aiming to bring its autonomous technology to the nerve center of the supply chain, has raised $ 65 million in funding just eight months after coming out of stealth. The Series B round was led by Koch Disruptive Technologies and brings its total funding raised to $ 118 million.
Other existing investors increased their investments, including NEA, 8VC and Prologis Ventures, according to the company. New investors included Henry Crown and Company and Evolv Ventures.
The company’s aim to automate distribution yards doesn’t get the same kind of attention as the more public-facing robotaxis that other companies are pursuing. But it could be as impactful and potentially lucrative to the company that pulls it off. Distribution yards are where goods make the transition from long-haul trucks to warehouses, and eventually the consumer. These hubs of economic activity rely on humans to make repetitive, manual tasks using diesel-powered yard trucks. There are some 400,000 distribution yards located in the United States, a number that provides an idea of the potential size of the opportunity.
The Golden, Colorado startup previously known as Azevtec developed a three-part system that includes an autonomous electric yard truck, software to manage the operations and site infrastructure. The total system automates the manual aspect of yard operations, including moving trailers around the yard as well as to and from loading docks. The system can also hitch and unhitch trailers, connect and disconnect trailer brake lines and monitor trailer locations.
Outrider touts the dual benefits of its electric and autonomous system. The company notes that its electric yard trucks are ideal for autonomy due to their reduced maintenance, lower operating costs and reliable clean power. Andrew Smith, the company’s founder and CEO, says disruptions caused by COVID-19 has highlighted the need for this kind of automated distribution yard technology.
Outrider, which now employs 110 employees, has completed “multiple” pilot programs, including one with Georgia-Pacific, and expanded its customer base since coming out of stealth in February.