Spain is known for many things all around the world, but digital or technology have not been one of such things for many decades. However, things are slowly but steadily changing for both regions. Barcelona has been described by many as and up-and-coming technology hub in Europe, thanks to a healthy combination of high class educational institutions, government support, ability to attract foreign talent and various waves of entrepreneurs and companies that have planted the seeds for generations to come. Given the young nature of Spain and Barcelona’s technology scenes, an analysis of their evolution has yet to be produced. 2015 was a record year for the country, and this report will analyse the bigger trends that have defined this record period of time and the areas that could and should still improve over the next few years in order for Spain and Catalonia to become worldwide known for their technology advancements.

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DIGITAL
STARTUP
ECOSYSTEM
OVERVIEW 2015
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2. Spanish Startup Ecosystem
Barcelona Digital Hub
Opportunity to foster the ecosystem
DIGITAL STARTUP ECOSYSTEM OVERVIEW 2015
2

3. Spanish Startup Ecosystem
3

4. STARTUPS IN SPAIN
More than 20 years creating tech companies
0
1.500
3.000
4.500
6.000
NASDAQ index & founding date of Spanish startups
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
.com crisis economic crisis vs
growth mobile companies
4
Source: Novobrief, Vitamina K

5. STARTUPS IN SPAIN
Spain: The digital sector continues to grow
Digital sector to account for 3.1% of
Spain’s GDP in 2016, €34.9 billion
Telco-driven sector
2,638 startups +26%Year-on-Year (YoY)
3 main hubs:
Barcelona: 26% of all startups,+16% (YoY)
Madrid: 27%, +25% (YoY)
Valencia: 14%, +32% (YoY)
5
Source: Boston Consulting Group, McKinsey, Startupxplore

6. STARTUPS IN SPAIN
Talent in Spain: competitive workforce, hard to find
Source: AngelList
SPAIN
MADRID
Less expensive to build
companies
Healthy developer density
BUT
Technical talent at big firms
Hard for startups to attract
that talent
Lack of big nation-wide
success
Source: Atomico, Stackoverflow
USD0USD30000USD60000USD90000USD120000
San Francisco
New York
UK
Europe
Ireland
Sweden
Germany
France
Italy
0 22.50045.00067.50090.000
San Francisco
London
Paris
Moscow
Istanbul
Berlin
Stockholm
Lisbon
Oslo
Adam Sedó, PR
Manager Amazon
Spain: “Tech talent in
Spain is abundant,
but most
importantly
available”
Average tech salary
Number of developers
6

7. Barcelona and Spain’s climate, lifestyle, talent pool, low cost structure and other
factures have helped it attract significant foreign talent (founders, employees
and investors)
STARTUPS IN SPAIN
Spain: attracting talent from abroad
Alex Puregger
(Fon)
Marek Fodor
(Atrapalo, Kantox)
Philippe Gelis
(Kantox)
Dominique Leca
(Stuart)
Ben Askew-Renaut
(Packlink)
Sacha Michaud
(Glovo)
Mauricio Prieto
(eDreams)
David Okuniev
(Typeform)
Gustavo
GBrusilovsky
(BuyVIP)
Conor O’Connor
(Hot Hotels)
7

8. Source: Novobrief
2015, RECORD YEAR
€500m + raised by Spanish startups for the 1st time ever
222
286
535
122
135
149
0
150
300
450
600
2013 2014 2015
Investment received by Spanish startups
Investment (m
€)
More quality and mature startups
Growth capital mostly provided by
international VC firms
More local talent available
Steady growth in startups, exponential
growth in fundraising
2015
2014
+29% (YoY)
+10% (YoY)
+87% (YoY)
+10% (YoY)Deals
Capital
raised
8

9. MEGA ROUNDS
13 rounds bigger than €10m
2013
2014
2015
2X €10m+ rounds in 2015
vs. 2013 and 2014 combined
9

10. HEALTHY MIX OF INVESTOR TYPES
VCs and business angels as key ecosystem drivers
Source: Venture Watch
59%
(69)
43%
(69)
15%
(17)
27%
(37)
0%
25%
50%
75%
100%
125%
2014 2015
Distribution of deals by investor type
(Q1-3 2015 vs. 2014)
Venture Capital Business Angel BA Network Public funding
Corporation Corporate VC Crowdfunding Accelerator 10

11. WHERE DOES THE MONEY GO?
An ecommerce (or mobile classifieds) country
Source: Venture Watch
0 17,5 35 52,5 70
Ecommerce
Marketing
Lifestyle
Fintech
Travel
Communications
Education
Gaming
Data
Food
Top investment sectors 2013-15
(number of deals)
€0 €100 €200 €300 €400
Ecommerce
Fintech
eGovernance
Security
Marketing
Communications
Employment
Gaming
Data
Lifestyle
Sectors that have received most
investment volume 2013-15 (M€)
11

12. FOREIGN INVESTORS NOT ONLY COME FOR THE SUN
Growth capital mostly provided by international investors
Most ever: 44 VCs
Fueling growth: 73% of all
capital invested in 2015
Only one round of €10m+
(Jobandtalent) with no
participation of foreign VCs
35%
15%
19%
13%
17%
In what type of rounds did foreign VCs participate in in 2015?
€1
to
€5m
€6
to
€10m
€11
to
€15m
€16
to
€20m
€20+m
Source: Novobrief
12

13. FOREIGN CAPITAL: 3 MAIN SECTORS
International investors mostly invested in these
sectors
Wallapop, Letgo, Fever
Accel Partners
Fidelity Growth Partners
Europe
Northzone VC
14W
Insight VP
Naspers Limited
Kantox, Novicap,
peerTransfer, Digital Origin
Bain Capital
Spark Capital
Partech Ventures
IdInvest Partners
Techstars Ventures
Tekton Ventures
QED
Devonshire Investors
Accel Partners
CartoDB, Typeform,
Userzoom
Earlybird VC
Accel Partners
Index Ventures
Salesforce
PNC
RTA Ventures
TC Growth
Partners
StepStone Group
MOBILE MARKETPLACES FINTECH ‘PURE SOFTWARE’
13

14. Barcelona Digital Hub
14

15. A DIGITAL HUB
Barcelona drives digital economy
10,700 ICT companies
73,000 employees
€14.5b in turnover (1/5 of Spain)
€214m in R&D
Barcelona startups:
Revenue: €6b
Workforce: 9,500
International activity: 60%
are active abroad
Source: Barcelona Activa (early 2015) & BCN Tech City survey
15

16. A DIGITAL HUB
Barcelona startup ecosystem
Source: BCN Tech City / Startupxplore
YOUNG:
4.8 years
MARKET:
41% B2B
26% B2C
33% B2B2C
SECTORS:
13% media
12% mobile
11% enterprise
6% marketing
FUNDING:
52% have received investment from
business angels
33% went through an accelerator
INTERNATIONAL:
60% active outside
of Spain, in more
than 50 countries
16

17. A DIGITAL HUB
Education + entrepreneurs + funding + public institutions/coworkings =
success
Education
Funding
Entrepreneurs
Accelerators
* Non representative
17

18. A DIGITAL HUB
Barcelona’s ecommerce & mobile economy
Source: Startupxplore
0,0% 3,5% 7,0% 10,5% 14,0% 17,5%
Ecommerce
Mobile
Enterprise
Marketing
Other
Travel
Communications
Health
Consumer web
Media
Education
Sports
Gaming
Software
Most common type of startup in
Barcelona (as % of total market)
Ecommerce
13.4%
Mobile
12.8%
Enterprise
10.8%
Marketing
6.2%
Travel
5.9%
Comms
5.7%
Health
5.2%
18

19. BARCELONA DOMINATES STARTUP INVESTMENTS
60% of all euros invested in 2015 went to Barcelona-based
startups*
324
165
20
€0
€175
€350
€525
€700
Barcelona* Madrid Valencia
2015
2014
2013
2011
Source: Webcapitalriesgo, Novobrief
* Barcelona and rest of Catalonia
19

20. BIGGEST ROUNDS IN BARCELONA
Explosive growth
Source: Webcapitalriesgo, Novobrief
€92
€40
€30
€15
€13
0 25 50 75 100
Letgo
Wallapop
UserZoom
Digital Origin
Typeform
Kantox
Softonic
Deporvillage
Loanbook
Marfeel
Largest investment rounds in 2015 (€m)
€264m invested in Barcelona
startups
Hypergrowth: +96% (YoY)
92% of all capital invested inall of
Spain in 2014 (€285m)
20
€6
€10
€4
€3
€3

21. BARCELONA’S TOP SECTORS
Mobile classifieds, ecommerce & fintech
Source: Webcapitalriesgo, Novobrief
61%
13%
10%
3%
13%
Startup sectors that attracted more investment in 2015
Ecommerce ‘Pure software’ Fintech Health Other
Wallapop, Letgo & other
ecommerce/classifieds startups
lead the way
Enterprise technology represented
by UserZoom, Typeform, comes in
second
Fintech (payments - Digital Origin,
FX - Kantox) third
5 investment rounds of €1m+ for
health startups
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22. INCREASING M&A ACTIVITY
Creating wealth through exits
Trovit! Akamon! La Nevera Roja*!
Founded in…! 2006! 2011! 2011!
Number of years
to exit!
8! 4! 3!
Selling price! €80m! €25! €80m!
Rounds of funding!
1
(€150,000)!
3+
(€2.8m)!
3+
(€10m)!
Revenue in last
full fiscal year
before exit!
€17.5m (2013)! €15m (2014)!
€2m
(€40m in reported
restaurant sales)!
EBITDA in same
period!
€6.2m! €800K (profit)!
Undisclosed
(not profitable)!
Revenue multiple
paid by acquirer!
4.5X! 1.6X! 40X!
Employees! 92! ~ 100! ~ 40!
Stake (%) of
founders at time of
exit!
~ 90%! ~ 78%! ~ 30%!
Founder earnings! €72m! €19.5m! €24m!
Investor earnings! €8m (57X)! €5.2m! €48m!
SIGNIFICANT EXITS IN RECENT YEARS
Key to spark entrepreneurship, new
startups and redistribution of wealth
More than $155 million in exits in past
two years
Recent exits:
Trovit (Next Co): €80m
bodas.net (Weddingwire)
Akamon (Imperus): €25m
Icebergs (Pinterest)
Ducksboard (New Relic)
Nubera (Gartner)
Source: Novobrief
*Madrid-based
22

23. Room for improvementOpportunity to foster the ecosystem
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24. EUROPEAN CONTEXT
Low density of business angels
Source: Atomico / AngelList
0 625 1.250 1.875 2.500
London
Paris
Berlin
Helsinki
Moscow
Istanbul
Amsterdam
Stockholm
Munich
Zurich
Dublin
Copenhagen
Vienna
Hamburg
Brussels
Oslo
Density of business angels in Europe
BARCELONA
MADRID
0 0 0 0 1
Helsinki
Zurich
Brussels
London
Amsterdam
Dublin
Paris
Stockholm
Copenhagen
Berlin
Munich
Oslo
Vienna
Hamburg
Moscow
Istanbul
Business angels per ,000 people
BARCELONA
MADRID
161
0.1
0.05
168
24

25. EUROPEAN CONTEXT
Spain accounts for small fraction of EU exits & M&A value
93%
7%
M&A deals in Europe (Q1-3 2015)
Rest of Europe
Spain
7% of all EU deals
446 in EU:
Germany: 88
UK: 62
Israel: 50
Spain: 29
France: 28
6% of all M&A value (€8b)
Telco-driven
Source: tech.eu
25

26. EUROPEAN CONTEXT
Limited impact of Spain’s ‘Ley de emprendedores’
Spanish government approved in 2013 ‘Ley de emprendedores’, an entrepreneur-friendly
law to promote startups and the creation of new companies
Its impact has been very limited
Spanish entrepreneurs and investors continue to face significant challenges:
High taxes at the early stage for founders
Exit tax when expanding and changing residency to a non-EU country
Lack of stock option schemes due to high taxes
High taxes for business angels
Source: tech.eu
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27. CONCLUSIONS
2015: A YEAR TO REMEMBER
Record investment numbers & notable exits
2015 was a record year for Spain and Barcelona on various fronts: for the first time
ever, Spanish technology companies received investment of more than €500 million,
fueled by the participation of a record number of international investors (44 VC firms)
and producing notable exits such as Trovit, La Nevera Roja or Akamon.
Worldwide category leaders
Startups such as Wallapop and Letgo -both based in Barcelona- have become category
leaders in the mobile classifieds sector, becoming the two most well funded startups
in the world to try to conquer the US market.
Scytl, born in 2002 and the most successful spin-off in the technology history of Spain,
has also consolidated its position as the leading eGovernment company in the world
and plans to IPO on the Nasdaq in 2017.
Things can, and should, get better
Investment per capita in Spain represents a small fraction compared to other European
countries, and so do the number of startup exits or business angels. This, coupled with
unfriendly laws for entrepreneurs and investors (exit tax, no stock options and high
taxation of business angels’ activity), pose a strong challenge for the development of
the country’s technology ecosystem.
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28. THANK YOU
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29. All of the charts, tables and figures that are included in this report come from
publicly available sources.
Special thanks to:
METHODOLOGY
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