Before our VC-backed exit analysis tomorrow, first we take a deeper look at the macro technology exits that occurred in the region in Q2, as the last three months witnessed further strong performance to build on Q1’s, with 46 Nordic technology exits totalling a disclosed $1.23 billion in Q2 2017.
Therefore this is the second most technology exits we’ve ever recorded in a quarter, coming in just below Q1’s 49, and following on from and continuing H2 2016’s high numbers. Which means we’ve now not recorded less than 40 technology exits in a quarter since Q2 2016, more than 12 months ago.
H1 2017 has seen a 37.7% year on year growth from H1 2016 and firmly positions 2017 to be a record year for technology exits in the region, with the possibility of the 200 exit mark being breached for the first time in a calendar year looking like a real possibility.
We’ll get into the specifics tomorrow, but Q2 2017 provided us with a healthy 34.8% (16) of the total technology exits in Q2 being venture backed, a solid increase from the 24.5% (12) that occured in Q1 and further proof that investors are beginning to see consistent returns on investing in Nordic technology companies.
As we predicted, Q2 was an excellent quarter for Nordic technology companies going public, with a record setting 10 taking place over the last three months, easily surpassing the previous high of 6, recorded in Q2 of last year. This meant that IPO’s represented over 1 in 5 tech exits in the last quarter, as well as dramatically increasing their percentage of 10.2% in Q1. This possibility of going public on a strong performing local exchange in First North is certainly having a big impact on the number of exits we have been seeing in the region over the last 12 months or so.
The countries have begun to be fairly consistent in terms of the exits they see each quarter, with Denmark’s decline to 5 from 9 in Q1 the biggest difference quarter on quarter demonstrating just how close the numbers are to those that were seen in Q1. Again, the similarities in the split compared to how many investments each country sees are not lost on us.
As ever, intra-regional acquisitions remains the biggest source of exits, with 75% of the acquirers based within the Nordics. This is a notable increase from Q1’s 60% and demonstrates the amount of money that is present in the region right now. American companies made two less acquisitions than they did in Q1, however, their giants still came shopping, with Apple acquiring Finnish Beddit, keeping this trend alive.
FinTech and Enterprise SaaS performed most strongly, just as they do for investment, with other investment favourites Entertainment and Media and Retail also featuring at the top. Automotive companies made up the top 5 as three exits were seen in this space in Q2.
Once again, we’ve seen another strong quarter for technology exits in the Nordics, and once again driven by a strong option in going public on First North, as investor appetite there continues to serve the region’s technology companies well. If this is maintained throughout the year, then it looks likely that we will see over 200 technology exits in 2017, a remarkable achievement, even when considering the level of capital that has been pumped into the region in recent years.