Europe & Israel 4Q15 Deals Done Review

Venture Capital in Europe & Israel
Venture Investment Data: Fourth Quarter, 2015
Prepared by Gil Dibner
Passo dello Stelvio, Italian-Swiss Border
Second highest pass in Europe, at 2,757 m (9,045 ft) above sea level
blog

The data
• Around the middle of last year, I decided I wasn’t happy with available data sources on VC
rounds in Europe & Israel, and that I’d need to build my own
• The data in this report consists entirely of data I’ve gathered manually based on publically
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
• Seed investment is still under-reported, but I got a bit better at capturing it in the fourth
quarter. Rounds smaller than $500K are generally excluded from this analysis
• The analysis is limited to ICT categories and excludes life sciences
• The analysis excludes Turkey and FSU countries
• I’m converting EUR and GBP into USD using monthly average exchange rates
2@gdibner
blog: yankeesabralimey Syndicate for European & Israeli Enterprise Companies

Quarterly pace of venture investment
• For the first time since I
started collecting data, the
total investment amounts in
Europe & Israel decreased
• In 4Q15, Europe & Israel saw
$2.856 billion flowing into
357 venture transactions
• While the number of
accounted and recorded
deals continued to rise, the
total amount of investment
dollars decreased to the
lowest quarterly level in 2015,
12% below 3Q15 and just
under 1% below 1Q15
3
@gdibner
1,703 1,916 2,873 3,139 3,248 2,856
122
204
270 271
286
357
0
500
1,000
1,500
2,000
2,500
3,000
3,500
0
50
100
150
200
250
300
350
400
Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4
2014 2015
Amountinvested(US$M)
Numberofinvestments
VC Investments in Europe & Israel
Invested amount (US $M) Number of investments

Monthly pace of venture investment
• During the fourth quarter of
2015, there were 357 venture
investments in Europe &
Israel totaling $2.9B
• Total investment volume
showed a decrease in every
month since September,
though December’s
especially low total likely
reflects the seasonal
slowdown
• Deal pace remained at 110-
125 per month, higher than in
any previous quarter
@gdibner
blog: yankeesabralimey 4Syndicate for European & Israeli Enterprise Companies
493
565
644
625
566
725
905
971
997
791
787
1,561
1,517
568
1,164
1,083
1,059
714
42 30 50 79 73 52 92 75 103 78 95 98 119
65 102 111 124 122
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2014 2015
Numberofinvestments
VC Investments in Europe & Israel, July 2014 - December 2015
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+)
• Three mega-rounds took place in
Europe this quarter – all of them
consumer-oriented businesses in
the UK:
• Karhoo, a UK-based on-demand taxi
app, raised $250M in October
• Deliveroo, a UK-based on-demand
food delivery service, raised $100M in
November
• Atom Bank, a UK-based challenger
consumer bank, raised $128M in
November
• Adjusting for mega-rounds, 4Q15
shows a decline compared to 3Q,
but is the second highest quarter
since 3Q14
5
@gdibner
248
349 285 354 368 507345
312
556
716 567
559539
935
1,154 813
1,513 1,187
0
500
1,000
1,500
2,000
2,500
3,000
3,500
2014 2015
AmountInvested(US$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
• 4Q15 total investment volume
in Europe & Israel was up
48% over 4Q14 (excluding
seed deals, where data is
more spotty)
• Early venture volume grew by
45%
• Venture volume grew by 79%
• Growth volume grew by 27%
• Mega round volume nearly
doubled, growing 91%
6
@gdibner
349
507
312
559
935
1,187250
478
0
500
1,000
1,500
2,000
2,500
3,000
Qtr4 Qtr4
2014 2015
TotalVCinvestment(US$M)
VC investment volume in Europe and Israelby bracket
Mega (>100) Growth (20-100)
Venture (8-20) Early Venture (2-8)

Number of investments, by bracket
• Excluding seed deals, the
total number of VC
investments per quarter was
223 in 4Q15, 24% higher than
3Q15
• All of this growth was in the
early venture bracket of
rounds under $8M, which
grew 49% from 93 in 3Q15 to
139 in 4Q15
• All other categories were
roughly flat in 4Q15
compared to 3Q15
7
@gdibner
60
83 77 85 93
13930
26 42
62 44
46
13
26
33
26 38
35
3
1
6
6 4
3
0
50
100
150
200
250
2014 2015
NumberofVCinvestments
VC investment volume in Europe and Israelby bracket
Mega (>100) Growth (20-100)

Corporate VC activity, by bracket
• Excluding seed deals, the
total number of corporate VC
investments was 42 in 4Q15,
double the number of
corporate VC investments in
3Q15
• Corporate VC activity in
Europe & Israel hit the
highest level since this data
set was started
8
@gdibner
6 4 5
16
7
22
4
3
9
12
7
12
4
4
7
8
7
7
3
1
0
5
10
15
20
25
30
35
40
45
2014 2015
Corporate VC investment volume in Europe and Israel by bracket
Mega (>100) Growth (20-100)

Corporate VC activity, by country
• During the fourth quarter of
2015, Israel saw the highest
number of corporate VC
investments, with 15
• The UK saw 7 corporate VC
investments during that
period
• Twelve other countries saw
corporate VC activity across
Europe, but at much lower
levels
9
@gdibner
10
3
1 1 1 1 1 1 1 1 1
3
3
1 1
2
1
1
2
2
1 1
1
1
0
2
4
6
8
10
12
14
16
Israel
UK
France
Spain
Germany
Sweden
Norway
Estonia
Finland
Switzerland
Belgium
Lituania
Austria
Netherlands
Numberofinvestments
Number of corporate VC investments in Europe and Israelby bracket
(4Q15)
Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8)

Average round size
• Previously, I presented this broken
down by bracket, but I think the
data is more meaningful when
taken in aggregate.
• This average excludes seed rounds
and mega rounds, so it reflects all
rounds done in Europe & Israel
between $2M and $100M
• From February to June, average
round sizes across all venture
rounds were hovering between
$10M and $12M
• The third quarter saw consistently
higher average round sizes –
between $13M and $14.5M on
average
• In the fourth quarter, however, the
trend reversed itself, with average
round sizes dropping to $11M in
October, $10.5M in November, and
$9.2M in December
10
@gdibner
11.1
17.6
6.8
11.7
11.3
12.7
15.8
11.2
11.9
11.1
10.1
11.4
13.9
13.2
14.6
11.1
10.5
9.2
4
6
8
10
12
14
16
18
20
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2014 2015
AmountInvested(US$M)
Average investment size in Europe and Israel
(Round sizes of 2-100M)

Total venture investment by country, 4Q 2015
• The UK again took the top
spot in 4Q15 with over
$900M in total capital
invested
• Israel took second place with
just under $700M in venture
capital investment
• Germany captured third
place, with $341M, and
France was a strong fourth
place at $225M
11
@gdibner
922.0
699.0
341.1
224.7
112.0
103.1
90.4
83.6
53.7
53.5
41.0
34.0
29.5
22.6
17.5
8.0
5.0
5.0
5.0
2.7
2.3
0.4
UK
Israel
Germany
France
Spain
Denmark
Switzerland
Sweden
Ireland
Finland
Belgium
Iceland
Lituania
Netherlands
Norway
Estonia
Bucharest
Austria
Italy
Portugal
Poland
Czech
0 100 200 300 400 500 600 700 800 900 1,000
Total VC investmentvolume by country, 4Q15 (US $M)

Total venture investment by country, 2015
• When 2015 is looked at as a
whole, the UK took the top
spot, at $3.3B
• Israel came in second with
$2.8B
• Germany, France, and
Sweden rounded out the top
five
• Spain, Denmark, the
Netherlands, and Ireland
each saw over $200M in VC
investment during 2015
12
@gdibner
3,335.3
2,786.6
1,921.6
1,167.9
950.8
450.4
264.2
242.3
236.8
161.9
146.0
122.9
55.1
42.5
38.2
35.6
35.4
29.5
29.3
24.6
12.6
UK
Israel
Germany
France
Sweden
Spain
Denmark
Netherlands
Ireland
Finland
Switzerland
Belgium
Estonia
Portugal
Norway
Greece
Iceland
Lituania
Italy
Poland
Slovenia
0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000
Total VC investmentvolume by country, 2015 (US $M)
(countries with over $10Min VC investment)

Total venture investment by country, 2015
(excluding mega rounds)
• When mega-rounds
($100M+) are excluded, Israel
saw more VC investment than
the UK in 2015
• Excluding mega-rounds,
Germany was a solid third
place with $1.3B raised in
2015, roughly half of Israel’s
figure, but nearly twice
France, which saw $853M
13
@gdibner
2,344.6
2,222.3
1,318.0
852.9
424.8
350.4
264.2
242.3
236.8
161.9
146.0
122.9
55.1
42.5
38.2
35.6
35.4
29.5
29.3
24.6
12.6
Israel
UK
Germany
France
Sweden
Spain
Denmark
Netherlands
Ireland
Finland
Switzerland
Belgium
Estonia
Portugal
Norway
Greece
Iceland
Lituania
Italy
Poland
Slovenia
0 500 1,000 1,500 2,000 2,500
Total VC investmentvolume by country, 2015
(Excludes mega-rounds, US $M, countries with over $10Min VC investment)

Total venture investment by country, 3Q14 to 3Q15
• To get a better sense of VC
volumes in various countries,
this analysis excludes mega-
rounds
• Investment volumes increase
in all of the top five markets
• Of the top five markets, only
Israel showed an increase in
4Q compared to 3Q
14
@gdibner
315
567
543
475
628
699
369
267
719
437
621
444
180
284
389
209
379
341
29
163
118
232
279
225
74 123
89
112
140
84
0
100
200
300
400
500
600
700
800
TotalVCinvestment(US$M)
Total VC investment, 3Q14 - 4Q15 (top 5 countries, excluding mega-rounds)
Israel
UK
Germany
France
Sweden

Average venture round sizes, by region
• This analysis excludes mega-
rounds and rounds less than
$2M
• In 4Q, DACH companies
raised the largest rounds on
overage
• When we compare 4Q15 to
4Q14, the trend is mixed –
round sizes in Israel, DACH,
and the Nordics decreased,
while other regions saw larger
round sizes
• Overall, the trend towards
round size convergence
seems to be continuing
15
@gdibner
Benelux, 4.7 Benelux, 4.5
DACH, 14.9
DACH, 12.5
France, 8.2
France, 9.2
Iberia, 7.2
Iberia, 9.4
Israel, 15.9
Israel, 11.5
Nordic, 11.5
Nordic, 8.0
UK & Ireland, 8.5
UK & Ireland, 11.2
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Qtr4 Qtr4
2014 2015
Averageroundsize(US$M)
Average investment size in Europe and Israel(rounds of $2-100M)

Total venture investment by region, 2015
• When VC investments across
Europe are aggregated into
regions, UK & Ireland, Israel,
DACH, the Nordics, and
France are the clear and
consistent leaders
• Benelux, Iberia, Southern
Europe, and Eastern Europe
do produce meaningful VC
investments, but the volumes
are still low
16
@gdibner
UK & Ireland, 3,572.1,
29%
Israel, 2,786.6, 23%
DACH, 2,073.9, 17%
Nordic, 1,541.5, 13%
France, 1,167.9, 10%
Iberia, 493.0, 4%
Benelux, 365.2, 3%
South. Eur., 78.3, 1%
East. Eur., 37.7, 0%
Total VC investment by region, 2015

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, Israel
led in the number of
announced deals, with 60
investments announced
• The UK & Ireland took second
place with 45
• The Nordics took third place
with 38, overtaking DACH
with 34
17
@gdibner
32
24
29
19 16
10 7
1 1
17
11 3
10
2
1
2
11
7
6
5
4
2
3
0
10
20
30
40
50
60
70
Israel UK &
Ireland
Nordic DACH France Benelux Iberia East. Eur. South. Eur.
Numberofinvestments
Number of investments in Europe and Israelby bracket, 4Q 2015
Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8)

Investment by region, by bracket
• When the three massive UK-
based mega-rounds are
excluded, Israel takes first
place in 4Q investment
volume
• Excluding mega-rounds, the
difference between UK &
Ireland and DACH is not that
great
18
@gdibner
120 83 85 85 64
226
128 117
343
259
224
191
113
58
478
0
200
400
600
800
1,000
1,200
Israel UK &
Ireland
DACH Nordic France Iberia Benelux East. Eur. South. Eur.
Totalamountinvested(US$M)
Investment in Europe and Israel by bracket by region, 4Q 2015
(ranked excluding mega-rounds)
Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8) Seed (<2)

Participation rate of US VC firms, by bracket
• US VC firms are increasingly
active in the European and
Israeli VC markets
• Year to date, US VC firms
participated in 14% of the
venture rounds in Europe
• US VCs participated in only
5% of seed rounds, 9% of
early venture rounds, and
22% of venture rounds
• As a company moves from
bracket to bracket, the
chance of US VC participation
doubles with each bracket
change
19
@gdibner
5%
9%
22%
39%
68%
95%
91%
78%
61%
32%
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)
Percentageofrounds
Did US VC firms participate in European VC rounds? (2015)
No Yes

Rate of participation by US firms has recovered
• US VC firm participation in
European & Israeli venture
rounds dropped in 4Q15 to
17%, down from 21% in 3Q
• In fact, 4Q15 saw the lowest
US VC participation rate since
I started tracking the data in
3Q14
20
@gdibner
16%
24% 20% 22% 21% 17%
84%
76% 80% 78% 79% 83%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015
PercentageofRounds
Did US VC firms participate in European VC rounds?
(Excludes seed rounds, 3Q14-4Q15)
No Yes

Participation of US VC firms by country
• In 4Q, US VCs firms were
active in 11 different European
countries, down from 14 in
3Q
• US VC firms were most active
in Israel, where they
participated in 14 investment
rounds out of 71 (20%)
• Germany saw 7 investments
with US VC participation
• The UK saw 6 investments
with US VC participation,
down from 7 in 3Q
• In Ireland, 2 of 3 VC
investments involved a US VC
21
@gdibner
14
7 6 3 2 2 2 2 1 1 10
10
20
30
40
50
60
70
80
Israel
Germany
UK
Spain
Ireland
Iceland
Switzerland
Finland
Lituania
Belgium
France
In which countries are US VCs most active?
4Q, 2015
No US VC involved US VC involved

Participation of US VC firms by country
• This chart shows US VC
activity within Europe
throughout 2015
• The bulk of US VC activity is
in Israel, the UK & Ireland,
DACH, and the Nordics
22
@gdibner
Israel, 12
Israel, 14 Israel, 14 Israel, 14
UK & Ireland, 10
UK & Ireland, 13
UK & Ireland, 9 UK & Ireland, 8
DACH, 8
DACH, 6
DACH, 4
DACH, 9
Nordic, 2
Nordic, 3
Nordic, 5
Nordic, 5Iberia, 3
Iberia, 4 Iberia, 3
Benelux, 5
France, 3
France, 2
East. Eur., 2
South. Eur., 2
0
5
10
15
20
25
30
35
40
45
50
Qtr1 Qtr2 Qtr3 Qtr4
2015
Investments with US VC participation, 2015
South. Eur. East. Eur.
France Benelux
Iberia Nordic
DACH UK & Ireland
Israel

Dimension Categories Explanation/Example
1. Target market
Consumer, SMB, Enterprise, Government,
Telecom, OEM
What sort of customer does the
company target?
2. Vertical market
Adtech, 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 model
Commerce, Components, Content,
Marketplace, SaaS, Semiconductors,
Services, Software, Systems,
How does the company make
money? What are customers paying
for?
Segment descriptor Consumer + Travel + Marketplace
AirBnB has built a travel-related
marketplace for consumers
Three-dimensional approach to sector mapping

• Excluding mega-rounds,
investment activity decreased
in consumer and increased in
enterprise in 4Q compared
with 3Q
• Enterprise-oriented
investments hit a new high of
$1.1B in 3Q
• SMB-oriented and OEM-
oriented investment volume
both decreased compared to
3Q, but remained at elevated
levels compared to previous
quarters
24
@gdibner
blog: yankeesabralimey
What target markets are attracting the most VC
investment in Europe & Israel?
Syndicate for European & Israeli Enterprise Companies
475 595
980 850
1,177
906
494
798
953
814
907
1,112
78
133
121
153
275
135
78
114
47
106
182
150
0
500
1,000
1,500
2,000
2,500
3,000
2014 2015
TotalVCinvestments(US$M)
European & Israeliventure financing by target market
3Q14 to 4Q15 (excluding mega-rounds, US $M)
Series A
Government
Telecom
OEM
SMB
Enterprise
Consumer

• When Israel is excluded from
the sample, 56% of all VC
dollars in Europe went to
consumer-oriented
companies
• OEM-oriented companies
continued to rise slightly in
importance, accounting for
5% of all VC dollars in Europe
25
@gdibner
Consumer investment leads Europe
62%
36%
56%
63% 62%
56%
18%
49%
34% 22% 24% 32%
6%
10%
4% 12% 8% 6%
5%
4% 2% 4% 5%6%8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015
European venture financing by target market
3Q14 to 4Q15 (excluding Israel, percent of US $M)
Government Telecom OEM SMB Enterprise Consumer

• When the sample set is
limited to rounds under
$20M, the ratio of consumer
to enterprise investments
looks a bit more balanced –
and steadier over time – but
there does seem to be a
rising trend in consumer-
oriented early-stage
investment
26
@gdibner
Consumer accounts for half of early rounds
39%
50% 46% 41% 46% 50%
41%
37% 50%
47% 39% 36%
9% 7% 9% 6%11%
7%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015
European venture financing by target market
3Q14 to 4Q15 (excluding Israel, rounds up to $20M, percent of US $M)

Breakdown by region & target market
• Once again, all regions
except Israel saw more
consumer investment than
enterprise/SMB investment
• Investments across France
and DACH were dominated
by consumer-oriented
companies
• The Nordics showed a
healthy balance, with a 50/50
split between enterprise and
consumer
27
@gdibner
648
180 208
149 143
66
237
437
148
149
59
45
88
71
0
200
400
600
800
1,000
1,200
UK & Ireland Israel DACH Nordic France Iberia Benelux
Totalamountinvested(US$M)
Investment in Europe and Israel by target market by region
4Q, 2015 (US $M)

Distribution of investment rounds by country
• Across Europe & Israel, 46%
of VC investment rounds
were in consumer companies
in 2015
• In DACH, 56% of rounds were
into consumer companies,
the highest proportion of any
region except Iberia, where
the number was 59%
• In UK, the number of
consumer rounds was around
50% of the total
28
@gdibner
29%
41%
42%
47%
48%
50%
56%
59%
56%
47%
36%
39%
40%
39%
32%
27%
4%
14%
7%
8%
9%
7%
13%
8%
5%
3%
3%
1%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Israel
South. Eur.
Benelux
Nordic
France
UK & Ireland
DACH
Iberia
Investment in Europe and Israel by target market by country
2015 (Number of investments)
Consumer Enterprise SMB OEM Telecom Government

Growth rounds by target market
• From 4Q14 to 2Q15, there
was an upward trend towards
consumer-oriented
companies in growth
investing, but this trend
reversed itself in 3Q15 and
continued into 4Q15
• For the first time, enterprise
companies accounted for
50% of all growth rounds in
Europe & Israel
29
@gdibner
56%
37%
46%
56%
43% 39%
25%
41%
46% 25%
38%
50%
6%
7%
5%
9% 12%
6% 11%
6%
7% 5%6%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015
Investment in Europe and Israel by target market
(Rounds over $20M, number of investments)

• Marketing was the most
popular vertical across
Europe & Israel, with 33
investments in the category
• Security was second, with 25
• Finance dropped to third
place, from first last quarter
• Lifestyle (which is a catch-all
consumer category) took the
fourth slot
• IT Infrastructure and health
took the fourth and fifth slots
30
@gdibner
Finance returned to being the top vertical
Marketing, 33
Security, 25
Financial, 22
Lifestyle, 20
Infrastructure, 17
Health, 17
Development, 16
Logistics, 16
Electronics, 16
Fashion, 14
Adtech, 13
Data, 13
Food, 12
Employment, 12
Education, 10Productivity, 10Social, 9Gaming, 9
Communications, 9
Entertainment, 8
Real Estate, 8
Payments, 7
Industrial, 7
Travel, 6
SCM, 5
Energy, 5
4Q 2015 (number of investments)

• This graph shows number of
investments in the top 10
verticals across 4Q14 and
4Q15
• All of the top ten verticals
increased in frequency
• Marketing-related
investments more than
doubled from 15 in 4Q14 to
33 in 4Q15
• Security investments
exploded in frequency from 4
in 4Q14 to 25 in 4Q15
• Health-related investments
nearly than doubled from 9 in
4Q14 to 17 in 4Q15
31
@gdibner
How have the most popular verticals grown?
Marketing, 15
Marketing, 33
Financial, 17
Financial, 22
Lifestyle, 13
Lifestyle, 20
Infrastructure, 15
Infrastructure, 17
Security, 4
Security, 25
Health, 9
Health, 17
Data, 11
Data, 13
Adtech, 11
Adtech, 13
Development, 7
Development, 16
Electronics, 7
Electronics, 16
Logistics, 7
Logistics, 16
0
50
100
150
200
250
Qtr4 Qtr4
2014 2015
European & Israeliventurefinancing by vertical market
(top 10 verticals, number of investments)

• Marketing was the most
frequently funded vertical,
with enterprise-oriented
marketing taking the lion’s
share within that category
• Security took second place
with a heavy emphasis on
enterprise security
• Finance dropped to third
place, with most of the
activity in the consumer
finance space, followed by
SMB finance
• IT infrastructure and health
tech made strong showings
• Consumer lifestyle,
electronics, and fashion also
made the top ten verticals
32
@gdibner
Which verticals for which segments?
Fashion
Electronics
Logistics
Development
Health
Infrastructure
Lifestyle
Financial
Security
Marketing
0 5 10 15 20 25 30 35
4Q, 2015 (number of investments, top 10 verticals)
Consumer
Enterprise
SMB
OEM
Telecom
Government

• This chart shows the ten most
commonly funded verticals
across Europe & Israel by
quarter
• Marketing, security, and
logistics, developer tooling
show continued strength
• Health and adtech seem to
have rebounded as areas of
investor interest
33
@gdibner
The most popular verticals in the past 12 months
2014 2015
0
50
100
150
200
250
European & Israeliventure financing by vertical market
(number of investments, top 10 verticals)
Marketing
Financial
Lifestyle
Infrastructure
Security
Adtech
Electronics
Health
Logistics
Development

• Lifestyle, which is admittedly a
bit of a catch-all consumer
category, continues to show
tremendous strength in terms
of VC volume
• Finance took the second place
overall
• Health showed significant
strength in 4Q
• Electronics (which typically
means consumer electronics
systems companies) seems to
have rebounded
• Gaming, travel, and food-
related categories whiched
seem to be declining in 3Q,
seemed to recover in 4Q
• Consumer-oriented logistics
plays seem to be emerging as
an important category for VC
investment
34
@gdibner
Consumer VC investment trends
2014 2015
0
20
40
60
80
100
120
140
European & Israeliventure financing by consumer verticals
Lifestyle
Financial
Fashion
Gaming
Health
Travel
Social
Food
Logistics
Electronics

• Enterprise marketing
continues to show strength as
an area for VC investment
• Most of the top enterprise
categories showed renewed
strength in 4Q
• Financial was a notable
exception, with little activity
within the enterprise segment
in 4Q
• Enterprise employment,
adtech, and security all
showed particular strength in
4Q investment frequency
35
@gdibner
Enterprise VC investment trends
2014 2015
0
20
40
60
80
100
120
140
European & Israeliventure financing by enterprise verticals
Marketing
Adtech
Security
Infrastructure
Data
Development
Employment
Financial
Health
Logistics

• Security retained the top spot
in Israel, with 16 investments
including 2 consumer-
oriented investments
• Israel also saw 8 investments
in IT infrastructure and 8
investments in the marketing
vertical
• Communications and big
data were the fourth and fifth
most frequently funded
categories
• Development tooling finally
cracked the top ten, with 3
investments in 4Q
36
@gdibner
A closer look at Israeli venture in 4Q15
Fashion
Financial
Electronics
Logistics
Development
Data
Communications
Marketing
Infrastructure
Security
0 2 4 6 8 10 12 14 16 18
Israeli venture financing by target market
Consumer
Enterprise
SMB
OEM
Telecom
Government

• Throughout 2015, security,
marketing, and infrastructure
were the most frequently
funded categories in Israel
• Communications, fintech, and
adtech also made good
showings
• Interestingly, enterprise
development tools and
consumer electronics are now
strong emerging categories
in Israel
37
@gdibner
A closer look at Israeli venture in 2015
Electronics
Development
Logistics
Productivity
Adtech
Financial
Communications
Infrastructure
Marketing
Security
0 5 10 15 20 25 30 35 40 45
Israeli venture financing by target market
2015 (number of investments, top 10 verticals)
Consumer
Enterprise
SMB
OEM
Telecom
Government

• For the fourth quarter
running, Fintech was the
dominant category of
investment in the UK, but this
quarter the differential was
much less than in 3Q
• Enterprise employment and
enterprise marketing were
also important categories
• As usual, consumer-oriented
companies dominated most
categories of VC funding
across the UK
• Adtech and gaming did not
crack the top ten
38
@gdibner
UK VCs dialed back on fintech in 4Q…a bit
Food
Lifestyle
Fashion
Development
Payments
Real Estate
Education
Security
Marketing
Employment
Social
Financial
0 1 2 3 4 5 6
UK venture financing by target market
4Q, 2015 (number of investments, top verticals)
Consumer
Enterprise
SMB
OEM

• When 2015 is looked at as a
whole, fintech was the
standout category in the UK,
with more than twice the
investment numbers as the
second most popular
category
• Enterprise marketing was the
second most frequently
funded category by UK VCs
• Consumer fashion was the
third most popular category
39
@gdibner
UK VCs focused on fintech in 2015
Adtech
Lifestyle
Security
Infrastructure
Payments
Education
Employment
Fashion
Marketing
Financial
0 5 10 15 20 25 30 35 40
UK venture financing by target market
2015 (number of investments, top verticals)
Consumer
Enterprise
SMB
OEM

• The top three categories in
German VC investment in
3Q15 were consumer lifestyle,
consumer travel, and
enterprise development tools
• In total, the top 10 categories
in Germany generated 31
investments, 15 of which were
in consumer companies
40
@gdibner
The German VC market in 4Q15
HMI
Adtech
Food
Communications
Energy
Logistics
SCM
Marketing
Fashion
Payments
Industrial
Health
Real Estate
Infrastructure
Financial
Electronics
Lifestyle
Travel
Development
0 1 2 3 4
German venture financing by target market
Consumer
Enterprise
SMB
OEM

• Throughout 2015, the most
frequently funded categories
in Germany were consumer
lifestyle, consumer fashion,
consumer fintech, enterprise
marketing, and consumer
food
• In total, the top 10 categories
in Germany generated 83
investments, 57 of which were
in consumer companies
41
@gdibner
German VCs focused on consumer in 2015
Education
Durables
Infrastructure
Health
Data
Travel
Food
Fashion
Marketing
Financial
Lifestyle
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14
German venture financing by target market
Consumer
Enterprise
SMB
OEM
Telecom

• Consumer lifestyle companies
and consumer gaming
companies were the two
categories in the Nordics
• Electronics were the third
vertical – split evenly between
consumer companies and
OEM companies
• In line with the rest of Europe,
fintech, employment, and
marketing were strong
categories
• The Nordic emphasis on
electronics and gaming sets it
apart from the rest of Europe
in an interesting way
42
@gdibner
As usual, Nordic VC was unconventional
Social
Productivity
Adtech
Entertainment
Marketing
Employment
Financial
Electronics
Gaming
Lifestyle
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Nordic venture financing by target market
Consumer
Enterprise
SMB
OEM
Government

• As software eats the world,
services are becoming an
increasingly important
business model for venture-
backed startups
• This was certainly the case in
2015, with services taking
26% of the venture dollars
invested in Europe & Israel
• SaaS emerged as the second
most funded business model
in 2015
• Commerce continues to be
important, with 17% of the
financing in 2015
• Marketplaces – business that
serve a price discovery
function – were 9%
43
@gdibner
Services & SaaS dominated 2015
Services,2,331, 26%
SaaS,1,969, 22%
Commerce, 1,497, 17%
Software, 1,343, 15%
Marketplace, 768,9%
Systems, 472,5%
Media, 406,4%
Components, 125, 1%
Semiconductors, 106, 1%
European & Israeliventurefinancing by target market
2015 (in US $M) (excluding mega-rounds)

• SaaS jumped to a record-
setting first place, at $655M
in funding in 4Q15
• Services dropped to second
with $480M
• Commerce took a major hit,
dropping nearly 50% from
3Q
• Marketplaces recovered a bit
in terms of investment
volume
44
@gdibner
In 4Q, SaaS set a record
0
100
200
300
400
500
600
700
800
2014 2015
European & Israeliventure financing by business model
(top five, in US $M, excluding mega-rounds)
Services
SaaS
Software
Commerce
Marketplace

US VCs focused on SaaS & services
• Throughout 2015, US VC
interest was skewed heavily
towards SaaS, Software &
Services models
• Markets, commerce, and
media investments also
attracted US VC interest, but
at much lower levels
45
@gdibner
47 43 32
15 12
259
232
147
119
95
72 80
0
50
100
150
200
250
300
350
SaaS Services Software Commerce Marketplace Media Systems Components Semiconductors
VC Investments in Europe & Israel
2015 (number of investments)
No US VC involved US VC involved

• Enterprise marketing SaaS
was by far the most popular
segment for VC investment in
2015 with 72 investments
across the region
• Consumer financial services
were next, with 42
investments
• Enterprise security software
was third, with 36 investments
46
@gdibner
Enterprise marketing & consumer fintech
0 10 20 30 40 50 60 70 80
Enterprise CRM SaaS
Consumer Travel Commerce
Enterprise Infrastructure SaaS
Enterprise Data Software
Consumer Education Services
Consumer Food Commerce
Consumer Gaming Software
Enterprise Employment SaaS
Enterprise Development SaaS
SMB Financial Services
Consumer Electronics Systems
Enterprise Adtech Services
Consumer Social Media
Consumer Lifestyle Commerce
Consumer Fashion Commerce
Enterprise Security Software
Consumer Financial Services
Enterprise Marketing SaaS
Number of VC investments
Investmentin Europe& Israelby segmentby country
2015 (segments with 15 or more investments)
UK & Ireland Israel
Nordic DACH
France Benelux
Iberia South. Eur.
East. Eur.

• Across Europe & Israel, US
VC firms invested in 74
enterprise companies, 49
consumer companies, 4 SMB
companies, and 4 OEM-
oriented companies
• Enterprise SaaS & Software
attracted by far more US VC
interest than any other space
47
@gdibner
What business models attract US VC investments?
0 5 10 15 20 25 30 35
Systems
Components
Semiconductors
Services
SaaS
SaaS
Systems
Software
Media
Marketplace
Commerce
Services
Services
Software
SaaS
OEMSMBConsumerEnterprise
US VC Investments in Europe and Israelby end market,
business model, & country, 2015 (excludes seed & mega-rounds)
Israel
UK & Ireland
DACH
Nordic
France
Iberia
Benelux
East. Eur.
South. Eur.

Show me the SaaS
• The most popular category
by far for SaaS investments
across the geography was
marketing
• Development tools were the
second most popular SaaS
category
• Productivity SaaS applications
came in third, with a focus on
consumer and SMB offerings
• Employment SaaS was the
fourth most frequently-
funded category
48
@gdibner
0 10 20 30 40 50 60 70 80 90 100
ERP
Adtech
Health
Data
CRM
Infrastructure
Employment
Productivity
Development
Marketing
SaaS VC investment in Europe and Israel
by vertical and target market, 2015 (top 10 verticals)
Consumer Enterprise Government SMB

Services investing in 2015
• This graph shows the top ten
verticals within the services
category in 2015 across
Europe & Israel
• Financial services were far
and away the most frequently
funded category for VC
investment in 2015 – mostly
for consumers and SMBs
• Adtech was the second most
funded services category in
2015
• Logistics and Education were
the third and fourth place
verticals
49
@gdibner
0 10 20 30 40 50 60 70 80
Gaming
Employment
Health
Marketing
Infrastructure
Communications
Payments
Education
Logistics
Adtech
Financial
Services VC investment in Europe and Israel
by vertical and target market, 2015 (top 10 verticals)
Consumer Enterprise SMB Telecom

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.
50
Gil Dibner
To invest in the best European & Israeli enterprise startups,
consider backing me on here. Lots of exciting stuff in the
pipeline – and you’ll be in pretty good company.

Thank you
blogPrepared by Gil Dibner

Europe & Israel 4Q15 Deals Done Review

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