This year, in addition to our 2015 Nordic funding analysis we are also producing a specific one for each country. In part, this is due to the fact that Iceland had such a strong year in 2015, as in 2014, they simply didn’t have enough investments to make an annual analysis worthwhile, which subsequently meant we decided not to do any country specific ones if we couldn’t do one for all of the individual countries that make up the Nordics. Well, that all changed in 2015:
In 2015, we tracked 17 Icelandic investments totalling $193.8 million
The majority of these investments occurred in the second half of the year, with twelve of them coming in Q3 and Q4, with Q4 being particularly active with 8 investments. This is mainly a result of the three new funds set up at the start of 2015 starting to get properly active.
The total amount raised was quite incredible, and was in fact only a couple of million dollars behind the collective amount for Finland, a country with a well-established ecosystem. However, this was mainly due to three particularly big rounds, which all featured in the top 20 that the entire Nordics saw in 2015, in fact, Verne Global was the second largest in the entire region, behind Spotify.
To complement these larger rounds, we also saw a good number of early-stage investments, presenting a rather healthy picture for the ecosystem when we breakdown the stage at which the 17 investments came, as we see a good mix of early and later stage money.
The median and average seed rounds are also very healthy, and if I am completely honest, a little surprising, as outside of the major hubs in Europe, these figures are certainly at the higher end of the scale when it comes to comparing these against other countries in Europe, and are more fitting of a maturer ecosystem than Iceland currently is. This is certainly encouraging for the future though, as these decent round sizes at an early-stage are going to give these companies much more of a fighting chance, and subsequently contribute to Iceland’s maturity as a startup hub.
People outside of Iceland are beginning to pick up on the fact that Iceland is starting to produce some very strong companies in gaming and/or VR, so it is no surprise that the money also leads to this conclusion. Nearly 1 in every 3 investments in Iceland in 2015 was in VR and/or gaming, demonstrating what a hot sector this is right now in Iceland.
2015 was certainly a breakthrough year for Iceland, as thanks to a storming Q4, there were significantly more investments in this year compared to the previous one, more than double in fact, a 142.86% growth year on year to be even more precise.
And if you thought that growth percentage was impressive, wait until you hear this one, the amount of investment grew 1568%, as the total venture capital and private equity invested in Icelandic companies jumped from $11.49 million in 2014, to $193.8 million in 2015.
Of course, this is due to the three particularly big rounds we saw in 2015, and this growth will not be sustained, and the total invested in Iceland in 2016 will likely be considerably less. However, what’s important to the long-term success of the Icelandic ecosystem is the number of investments occurring, and this is growth that is definitely more sustainable both as the new funds continue to invest, and as more investors become aware of the opportunities that exist in Iceland, particularly in VR and/or gaming. If 2016 grew at the same growth rate, then we would see 41 investments in Iceland this year, a number befitting of an ecosystem that is growing both in terms of size and promise.
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