Europe & Israel 1Q17 Venture Capital Review

Venture Capital in Europe & Israel
Venture Investment Data: First Quarter 2017
Prepared by Gil Dibner
Berlin, view along the Spree River towards the Bode Museum (opened as the Kaiser-Friedrich-Museum in 1904)
and the Fernsehturm television tower (368M, completed in 1969).
blog

The data
• The data in this report consists entirely of data I’ve gathered manually based on
publicly 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. More importantly, it allows me to exclude
deals that are really not “venture capital” rounds but tend to get included by
others
• Seed investment is under-reported and adds a lot of noise to the data set, so I
exclude deals under $500K
• The analysis is limited to ICT categories and excludes life sciences
• The analysis excludes Turkey and FSU countries
• All currencies converted into USD using monthly average exchange rates
Prepared by Gil Dibner follow me on (@gdibner), connect with me on , subscribe to my , or invest with me onblog 2

Top 10 deals by region in Q1 2017 (US $M)
France & Benelux IsraelIberia
UK & Ireland DACH Nordic
15
15
21
24
25
25
26
28
53
100
104
Garrison Technology
Ecrebo
CompareEuropeGroup
Monzo
Evrythng
CurrencyCloud
Upstream
Whistle Sports
Arralis
Funding Circle
Atom Bank
0 50 100 150
16
18
20
22
32
32
53
70
127
165
Ottonova
WayRay
Knime
Book a Tiger
SolarisBank
Raisin
ResearchGate
SoundCloud
Lampenwelt.de
Tricentis
0 50 100 150 200
12
12
12
15
16
17
17
22
26
50
63
Fuse
Qapital
Xeneta
NA-KD
Skeleton Technologies
Pipedrive
Starship Technologies
Soundtrack Your Brand
24 Storage
Collibra
iZettle
0 20 40 60 80
2
2
2
2
2
3
4
5
5
6
11
12
175
Apartum
Mr. Jeff
Subasta de Ocio
Gamelearn
RocketROI
21 Buttons
Hundredrooms
RavenPack
Fever
Odilo
Logtrust
Scytl
LetGo
0 50 100 150 200
16
20
23
27
30
35
35
61
69
105
Databerries
Qwant
Bloomon
Doctolib
Bitfury
Guest2Guest
JobToday
Vestiaire…
Oodrive
Picnic
0 20 40 60 80 100 120
20
20
20
20
20
23
25
25
30
30
40
56
70
75
Healthwatch
Demisto
Samanage
Feedvisor
VATbox
Reduxio
Valens
FreightOS
Exabeam
Autotalks
Transmit Security
Appsflyer
SentinelOne
Kaminario
0 20 40 60 80

Top 10 deals by type in Q1 2017 (US $M)
Systems SaaSEnterprise
Consumer Financial Commerce
26
27
28
35
61
70
104
105
127
175
24 Storage
Doctolib
Whistle Sports
Guest2Guest
Vestiaire Collective
SoundCloud
Atom Bank
Picnic
Lampenwelt.de
LetGo
0 50 100 150 200
32
35
40
50
53
56
69
70
75
165
Raisin
JobToday
Transmit Security
Collibra
ResearchGate
Appsflyer
Oodrive
SentinelOne
Kaminario
Tricentis
0 50 100 150 200
14
20
22
24
25
30
32
32
100
104
Earnix
VATbox
Creamfinance
Monzo
CurrencyCloud
Bitfury
SolarisBank
Raisin
Funding Circle
Atom Bank
0 20 40 60 80 100 120
10
12
13
15
16
17
20
53
63
75
Arktis
Famoco
Usound
EasyMile
Skeleton Technologies
Starship Technologies
Healthwatch
Arralis
iZettle
Kaminario
0 20 40 60 80
8
9
11
11
15
21
23
61
105
127
Blue Bay Travel
Restoflash
Campanda
Mycs
NA-KD
CompareEuropeGroup
Bloomon
Vestiaire Collective
Picnic
Lampenwelt.de
0 50 100 150
20
20
20
22
25
25
26
35
50
69
165
Demisto
Knime
Samanage
Soundtrack Your Brand
Evrythng
CurrencyCloud
Upstream
JobToday
Collibra
Oodrive
Tricentis
0 50 100 150 200

Quarterly pace of venture investment
• In 1Q17, Europe & Israel saw
$4.0 billion flowing into 521
venture transactions
• 1Q17 was a record-breaking
quarter in terms of the
number of venture deals
• 1Q17 was the second-highest
quarter in terms of amount
invested
• These numbers, and the rest
of this deck, do not reflect
the $1B in debt raised by
Spotify in March
2,873
3,139
3,252
2,857
3,730
4,114
3,122
3,522
4,018
0
100
200
300
400
500
600
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1
2015 2016 2017
Amountinvested(US$M)
VC Investments in Europe & Israel
Invested amount (US $M) Number of investments

Monthly pace of venture investment
• Looked at on a monthly
basis, the strong first quarter
was driven by a strong
January and March
• January was very strong, on
par with the previous year –
this likely reflects pent up
activity from 4Q getting
announced publicly in 1Q
• Monthly deal volume
throughout the quarter was
near the historical ceiling of
approximately 180 deals per
month across the geography
905
971
997
791
787
1,561
1,518
571
1,164
1,084
1,059
715
1,657
1,051
1,021
1,401
1,452
1,261
725
1,101
1,296
1,457
1,170
895
1,640
944
1,434
0
20
40
60
80
100
120
140
160
180
200
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
2015 2016 2017
Amountinvested(US$M)
VC Investments in Europe & Israel
(January 2015 - March 2017)
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+)
• Six mega-rounds took place in
Europe in 1Q17
• Letgo (Spain, $175M)
• Tricentis (Austria, $165M)
• Lampenwelt (Germany, $127M)
• Picnic (Netherlands, $105M)
• Atom Bank (IUK, $104M)
• Funding Circle (UK, $100M)
• Adjusting for mega-rounds,
1Q17 was a record quarter at
$3.24B, just edging out 2Q16
($3.21B)
510 602 635 592 709 751
559
730 695 752 651
911
1,187
1,650 1,679
1,336 1,197
1,366
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1
2015 2016 2017
AmountInvested(US$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
• All size brackets except
growth saw YoY increases in
1Q17 compared to 1Q16
• Seed deal volume increase by
21%, early venture and
venture both increased by
25%, and mega-deal volume
increased by 36%
• Growth venture volume
decreased by 17%
177 215
602 751
730
911
1,650
1,366
571
776
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Qtr1 Qtr1
2016 2017
TotalVCinvestment(US$M)
VC investmentvolume in Europe and Israel by bracket
(1Q17 vs 1Q16)
Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8) Seed (<2)

Number of investments, by bracket
• Excluding seed deals, the
total number of VC
investments per quarter was
314 in 1Q17, a new record
level since I started tracking
this data
77 85 94
140 153 157 144
182 19342
62 44
46
61 57
64
53
76
33
26 38
35
44 52
40
35
39
6
6 4
3
4 4
1
6
6
0
50
100
150
200
250
300
350
2015 2016 2017
NumberofVCinvestments
VC investmentvolume in Europe and Israel by bracket
Mega (>100) Growth (20-100) Venture (8-20) Early Venture (2-8)

No impact of Brexit on deal volume, but…
• Looking just at UK VC deal
volume, there’s so far no
evidence that Brexit caused
any slowdown whatsoever in
VC activity
• There were an average of 15 VC
deals per month in the 18
months before the referendum
• There were an average of 20 VC
deals per month since the
referendum
0
5
10
15
20
25
30
35
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
2015 2016 2017
VC investmentvolume in the UK by bracket
Pre-
Brexit
avg = 15
Post-Brexit
avg = 20

Total invested capital per quarter is down since Brexit
• Looking just at total invested
capital in the UK, there does
appear to be an impact since
the Brexit referendum
• An average of $819M per
quarter was invested in the UK
in the 18 months before the
referendum
• An average of $648M per
quarter was invested in the UK
since the referendum
• VC investment volume in the
UK is down 21% per quarter
since the Brexit referendum
74 70 98 79 136 108 133 150 188
165 166 96 128
172
148
181 113
160
459
180
405
209
532
273 202
191
149
210
150
275
478
192
110
275
204
0
200
400
600
800
1,000
1,200
2015 2016 2017
VC investmentvolume in the UK by bracket
Pre-Brexit
avg = $819M
Post-Brexit
avg = $648M

Corporate VC activity, by bracket
• Excluding seed deals, the
total number of corporate VC
investments rose to 54 in
1Q17 compared to 44 in 4Q16
• Corporate VC investments
are trending towards later
stage
6 4 5
16
7
22 19
23
19
27 24
4
3
9
12
7
12
6
16
19 5
17
4
4
7
8
7
7
20
18
6
9
11
3
1
3
3
3
2
0
10
20
30
40
50
60
70
Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1
2014 2015 2016 2017
CorporateVC investmentvolume in Europe and Israel by bracket

Corporate VC activity, by country
• During 1Q17, Israel saw the
highest number of corporate
VC investments, with 18
• The UK saw 12 corporate VC
investments during the
quarter
• Germany and France took the
third and fourth spots, with 7
and 4, respectively
• Corporate investors
participated in two mega-
rounds in the geography in
the quarter
8
5 4
2
5
4
3
2
5
2
2
0
2
4
6
8
10
12
14
16
18
20
Israel
UK
Germany
France
Netherlands
Sweden
Ireland
Poland
Finland
Switzerland
Estonia
Italy
Numberofinvestments
Number of corporate VC investments in Europeand Israel by bracket
(1Q17)

Average round size
• This average excludes seed
rounds and mega rounds, so
it reflects all rounds done in
Europe & Israel between $2M
and $100M
• With very few exceptions,
most months saw average
round sizes of $10-12M and
there is seems to be little
pattern other than mean
reversion
• 3Q15 is the only systematic
outlier to this trend, with
average round sizes of $12-
15M throughout the quarter
• As the six-month trailing
average shows, average
round sizes are drifting
downward
4
6
8
10
12
14
16
18
20
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
2014 2015 2016 2017
AmountInvested(US$M)
Average investmentsize in Europe and Israel
(Round sizes of 2-100M, and 6-month trailingaverage)

Total venture investment by country, 1Q 2017
• Israel saw the most VC
investment in 1Q17, with
$802M raised
• The UK came in second
place, with $740M raised
• Germany saw the third-
highest amount of venture
investment, with $562M
• France was a close fourth,
with $550M
802
740
562
550
247
235
189
182
104
91
79
50
42
35
33
25
25
13
12
2
2
Israel
UK
Germany
France
Spain
Sweden
Netherlands
Austria
Ireland
Denmark
Switzerland
Estonia
Luxembourg
Belgium
Poland
Italy
Finland
Norway
Cyprus
Czech
Iceland
Total VC investmentvolumeby country, 1Q17 (US $M)

Vive la Frenchtech!
Total venture investment by country, 1Q15 to 1Q17
• To get a better sense of VC
volumes in various countries,
this analysis excludes mega-
rounds
• With this filter, volumes and
rankings are more consistent
• For the first time, France
came in second, leapfrogging
ahead of the UK and
Germany in one quarter
• Sweden’s steady rise (five
quarters of uninterrupted
growth) is also worthy of note
• The UK and Germany seem
to have levelled out over the
past year
543
475
628
699
963
1,064
877
490
802
719
437
625 444
871
553 544
487 536
389
209
379
342 335
429
460
473
435
118
232 279
224 279
367
339 443
550
89 112
140
84
139 151
198
224 235
0
200
400
600
800
1000
1200
TotalVC investment,1Q15 - 1Q17 (top 5 countries, excluding mega-rounds)
Israel
UK
Germany
France
Sweden

Total venture investment by country, 3Q14 to 4Q16
• To get a better sense of VC
volumes in various countries,
this analysis excludes mega-
rounds
• The “second five” countries
for VC investment in 2016
were Spain, Ireland, the
Netherlands, Finland, and
Denmark
2015 2016 2017
0
20
40
60
80
100
120
140
TotalVC investment,1Q15 - 1Q17
(countries ranked 6-10, excluding mega-rounds)
Spain Ireland
Netherlands Finland
Denmark

Average venture round sizes, by region
• For a while, I had been seeing
a trend towards convergence
in the sizes of rounds across
the geography
• Into 2017, this trend seems to
be holding
• Most regions saw average
round sizes flat or slightly
down
• Average deal size in Israel is
increasing
Benelux,4.7
Benelux,10.8
DACH, 14.9
DACH, 11.4
France, 8.2 France, 8.1
Iberia,7.2
Iberia,4.6
Israel,15.9
Israel,15.2
Nordic,11.5
Nordic,9.9UK & Ireland,8.5
UK & Ireland,7.8
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
Qtr4 Qtr4 Qtr1
2014 2015 2017
Averageroundsize(US$M)
Average investmentsize in Europe and Israel (rounds of $2-100M)

Total venture investment by region
• When VC investments across
Europe are aggregated into
regions, UK & Ireland, DACH,
Israel, DACH, and the Nordics
are the clear and consistent
leaders
• Benelux, Iberia, Southern
Europe, and Eastern Europe
do produce meaningful VC
investments, but the volumes
are still low
UK & Ireland,844
DACH, 822
Israel,802
France, 550
Nordic,415
Benelux,266
Iberia,247
South.Eur., 37
East.Eur., 35
TotalVC investmentby region, 1Q17

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, the UK
and Ireland saw 79 venture
deals in the fourth quarter
• Israel took third place with 52
52
45
20 24 25
8 11
4 4
18
10
18
15 9
3
7
4
14
6
4
3
0
10
20
30
40
50
60
70
80
90
UK &
Ireland
France Israel DACH Nordic Benelux Iberia East. Eur. South. Eur.
Numberofinvestments
Number of investments in Europe and Israel by bracket, 1Q 2017

Participation rate of US VC firms, by bracket
• In the first quarter, US VCs
participated in 8% of the VC
financing rounds in EU and
Israel
• As usual, US VCs are much
more likely to participate in
later rounds
2%
5%
20%
31% 33%
98% 95%
80%
69% 67%
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 participatein EuropeanVC rounds? (1Q17)
No Yes

US VC firm participation rate drops in 4Q
• In 1Q17 and 4Q16, US VCs
participated in about 12% of
the rounds that took place in
Europe
• This rate is the lowest since
I’ve been tracking the data
• This analysis excludes seed
and mega-rounds
15%
23%
17% 20% 20% 16% 16%
21% 21%
12% 12%
85%
77%
83% 80% 80% 84% 84%
79% 79%
88% 88%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015 2016 2017
PercentageofRounds
Did US VC firms participatein EuropeanVC rounds?
(3Q14-1Q17)
No Yes

Participation of US VC firms by country
• In 1Q17, US VCs firms were
active in 9 different European
countries
• US VC firms were most active
in Israel, where they
participated in 14 investment
rounds
• The UK saw 12 US
investments
• US VCs invested in 6 German
companies
14
12
6
2 2 2 2 2
1
0
2
4
6
8
10
12
14
16
Israel
UK
Germany
Estonia
Spain
Denmark
France
Ireland
Austria
Rounds with a US VC involved
(1Q17)

Participation of US VC firms by country
• This chart shows US VC
activity within Europe
• The overwhelming bulk of US
VC activity is generally in
Israel, the UK & Ireland,
DACH
Israel,12 Israel,14 Israel,14 Israel,14 Israel,16
Israel,27 Israel,25
Israel,12 Israel,14
UK & Ireland,10
UK & Ireland,14
UK & Ireland,10
UK & Ireland,8
UK & Ireland,11
UK & Ireland,11
UK & Ireland,12
UK & Ireland,1
UK & Ireland,14
DACH, 8
DACH, 6
DACH, 4 DACH, 9
DACH, 6
DACH, 9
DACH, 8
DACH, 11
DACH, 7Nordic,2
Nordic,3
Nordic,5
Nordic,5
Nordic,5
Nordic,4
Nordic,6
Nordic,4
Iberia,3
Iberia,4
Iberia,3
Iberia,2
Iberia,2
France, 3
France, 2
France, 2
France, 3 France, 3
France, 2
Benelux,5
Benelux,2 Benelux,3
0
10
20
30
40
50
60
2015 2016 2017
Investments with US VC participation
Israel UK & Ireland DACH Nordic Iberia France Benelux East. Eur. South. Eur.

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? How is value delivered to
customers? What are customers
paying for?
For example: Consumer + Travel + Marketplace
AirBnB has built a travel-related
marketplace for consumers
Three-dimensional approach to sector mapping

• Excluding mega-rounds,
investment activity was flat in
consumer but increased in
enterprise
What target markets are attracting the most VC investment
in Europe & Israel?
980 850
1,177
931 1,076
1,244 1,097 1,004 1,017
953
804
910
1,110
1,654
1,640
1,269
962
1,636
275
224
270
285
182
150
163 187
219
448
254
0
500
1,000
1,500
2,000
2,500
3,000
3,500
2015 2016 2017
TotalVCinvestments(US$M)
European& Israeli venture financing by target market
3Q14 to 1Q17 (excluding mega-rounds, US $M)
Agriculture
Government
Telecom
OEM
SMB
Enterprise
Consumer

• When Israel is excluded from
the sample, 46% of all VC
dollars in Europe went to
consumer-oriented
companies
• Enterprise and SMB
categories spiked in 1Q17
Consumer investment leads Europe
62%
36%
56%
63% 62%
57% 53% 58%
52%
45% 46%
18%
48%
34% 22% 24% 31% 35%
33%
32%
29%
36%
6%
10%
4% 12% 8% 6% 5% 3%
7%
8%
12%5%
4% 2% 4% 5% 6% 5% 8%
10%
5%6% 6%8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015 2016 2017
Europeanventure financing by target market
3Q14 to 1Q17 (excluding Israel, percent of US $M)
Agriculture Government Telecom OEM SMB Enterprise Consumer

Breakdown by region & target market
• Regional differences are very
apparent when VC
investment are categorized
by target market
355 338
56
249
121 144
212
278 336
641 242
163 105
133 88
52
100
74 48
97
0
100
200
300
400
500
600
700
800
900
UK &
Ireland
DACH Israel France Nordic Benelux Iberia South.
Eur.
East. Eur.
Totalamountinvested(US$M)
Investment in Europe and Israel by target market by region
2017 (US $M)
Agriculture Government Telecom OEM SMB Enterprise Consumer

Distribution of investment rounds by country
• Across Europe & Israel, 42%
of VC investment rounds
were in consumer companies
in 2016
• Over two-thirds of Israeli
venture investments were
into enterprise companies
• Three quarters of VC
investments in Iberia were
into consumer companies
74%
69%
46%
42%
42%
42%
28%
16%
19%
25%
38%
26%
36%
42%
48%
69%
12%
21%
13%
8%
4%
6%
10%
8%
7%
4%
11%
7%
12% 4%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Iberia
South. Eur.
France
DACH
Nordic
UK & Ireland
Benelux
Israel
Investment in Europe and Israel by target market by country
1Q17 (Number of investments)
Consumer Enterprise SMB OEM Telecom Government Agriculture

Growth rounds by target market
• Enterprise companies
accounted for just over half of
the later-stage market in
Europe & Israel in 1Q17
56%
37%
46%
56%
43% 39% 38%
43% 44%
34% 36%
25%
41%
46% 25%
38% 50% 50%
50% 44%
32%
51%
6%
7%
5%
9% 12%
3% 6% 5%
12%
7%6% 11%
6%
7% 5% 6% 5% 5%
20%
7%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2014 2015 2016 2017
Investment in Europe and Israel by target market
(Rounds over $20M, number of investments)
Government Telecom OEM SMB Enterprise Consumer

• Fintech was the most popular
vertical across Europe &
Israel, with 62 investments in
the category
• Lifestyle (a catchall category
for consumer commerce) was
the second most popular
vertical, with 35
Finance returned to being the top vertical
5
5
6
6
8
8
9
9
9
11
11
12
12
12
12
12
12
13
13
16
18
19
19
22
24
25
28
30
31
35
62
Productivity
HMI
Industrial
Agtech
Communications
Legal
Real Estate
ERP
Social
CRM
Entertainment
Development
Energy
Travel
Automotive
Gaming
Food
Payments
Logistics
Fashion
Adtech
Education
Data
Health
Security
Electronics
Employment
Marketing
Infrastructure
Lifestyle
Financial
1Q17 (top 30 categories, number of investments)

• This graph shows the change
in the number of investments
by vertical from 1Q17 to 1Q16
• Lifestyle e-commerce,
fashion, health, infrastructure,
and electronics increased the
most in frequency
• Logistics, CRM, and Industrial
saw the biggest declines
Growth rates by vertical
Industrial,-65%
CRM, -45%
Logistics,-28%
Development,-14%
Marketing, -9%
Gaming, -8%
Food, -8%
Security,4%
Payments,8%
Energy, 9%
Grand Total, 11%
Financial,19%
Adtech,20%
Data, 27%
Employment,27%
Electronics,32%
Infrastructure, 35%
Health,38%
Fashion,45%
Lifestyle,67%
-80% -60% -40% -20% 0% 20% 40% 60% 80%
Change in the number of venture investments
(1Q17 vs 1Q16, 20 most popular categories)

• Finance was once again the
most frequently funded
vertical, but with increased
attention to enterprise and
SMB
• Consumer lifestyle companies
took second place
• Infrastructure jumped to third
place
• Marketing dropped from
third to fourth
Which verticals for which segments?
Data
Education
Health
Security
Electronics
Employment
Marketing
Infrastructure
Lifestyle
Financial
0 10 20 30 40 50 60 70
1Q17 (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
The most popular verticals in the past 2 years
2014 2015 2016 2017
0
50
100
150
200
250
300
350
European& Israeli venture financing by vertical market
(number of investments, top 10 verticals)
Adtech
Health
Logistics
Electronics
Lifestyle
Employment
Security
Infrastructure
Marketing
Financial

• Investors continue to favor
financial, lifestyle, and health
investments
• Education and fashion
bounced back
• Logistics (ride sharing, taxi
hailing, and the like) appears
to be played out
• Food and travel seem to be
in decline
Consumer VC investment trends
2014 2015 2016 2017
0
20
40
60
80
100
120
140
160
180
European& Israeli venture financing by consumer verticals
Travel
Health
Fashion
Food
Electronics
Logistics
Gaming
Lifestyle
Financial
Education

• Security, financial, and
HR/employment-related
technology showing increases
in 1Q17
• CRM and industrial declined
in 1Q17
Enterprise VC investment trends
2014 2015 2016 2017
0
20
40
60
80
100
120
140
160
180
European& Israeli venture financing by enterprise verticals
CRM
Financial
Industrial
Employment
Development
Data
Infrastructure
Adtech
Security
Marketing

• SaaS was the most funded
business model in 1Q17,
representing 27% of all VC
dollars
• Services took 22% of the
venture dollars invested in
Europe & Israel
• Systems – complete physical
products – took fourth place
at 11% of all venture dollars
• Marketplaces – businesses
that serve a price discovery
function – rebounded to 9%
SaaS above all (but keep an eye on systems)
SaaS, 887, 27%
Services, 721, 22%
Software, 457, 14%
Systems, 364, 11%
Marketplace,
299, 9%
Commerce, 244, 8%
Media,
153, 5%
Semiconductors, 55, 2%
Components, 52, 2%
Materials, 11, 0%
European & Israeli venture financing by target market
1Q17 (in US $M) (excluding mega-rounds)

• SaaS and Services remained
the top two business models
by funding volume
• Commerce collapsed from
third place in 4Q16 to sixth
place in 1Q17
• Systems maintained their
fourth place ranking
• Marketplaces rebounded
somewhat
Commerce disappears and systems rise
0
200
400
600
800
1000
1200
2014 2015 2016 2017
European& Israeli venture financing by business model
(top seven, in US $M, excluding mega-rounds)
Services
SaaS
Software
Commerce
Marketplace
Systems
Media

• This graph provides a quick
overview of the ten most
commonly funded segments
across the top ten countries
for those segments
• In a nutshell:
• Consumer financial services
(Everywhere, but especially in
the UK)
• UK marketing SaaS
• Israeli enterprise security
software
• French infrastructure SaaS
• French adtech services
• UK enterprise financial SaaS
• French consumer electronics
• And some other stuff…. 
EU+IL VC Cheat Sheet (1Q17)
0 5 10 15 20 25 30 35
Consumer Education Services
Consumer Electronics Systems
Enterprise Financial SaaS
Enterprise Adtech Services
Enterprise Infrastructure SaaS
Consumer Fashion Commerce
Enterprise Data SaaS
Consumer Lifestyle Commerce
Enterprise Security Software
Enterprise Marketing SaaS
Consumer Financial Services
Number of VC investments
Investment in Europe & Israel by segment by country
1Q17 (top 10 segments, top 10 countries)
UK France
Israel Sweden
Germany Ireland
Spain Switzerland
Poland Italy

Focus on Infrastructure
• 1Q17 saw a dramatic rise in
the number of infrastructure-
oriented investments across
Europe and Israel
• A lot of this had to do with a
spike in activity in France
0
5
10
15
20
25
30
2014 2015 2016 2017
Numnberofinvestments
Infastructure - VC investmentin Europe and Israel
Latvia Iceland Portugal Luxembourg Greece
Denmark Italy Poland Norway Belgium
Ireland Netherlands Finland Switzerland Spain

Focus on Fashion
• 1Q17 also saw a spike in the
number of fashion-oriented
investments across Europe
and Israel
• Activity in France, Italy, the
UK, and Sweden was the
main driver here
0
2
4
6
8
10
12
14
16
18
2014 2015 2016 2017
Numnberofinvestments
Fashion - VC investment in Europe and Israel
Greece Portugal Denmark Switzerland Lithuania Finland Netherlands
Italy Israel Sweden Spain France Germany UK

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.
42
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.

Europe & Israel 1Q17 Venture Capital Review

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