Last week, Boozt Fashion, a Swedish company backed by investors include Sunstone Capital and Verdane went public with a market capitalisation of over $400 million. Despite an exit that nearly made it half a (actual returns realised) ‘unicorn’, there was next to no coverage in the English tech media.
This is not a new occurrence, but nor are large VC-backed exits originating from the Nordics, although you may have heard very little about them unless you read the local news. In fact, there’s been 21 VC-backed exits above $100 million since the start of 2015, meaning that on average the region produces one $100 million+ VC-backed exit every six weeks.
And they are not all happening in Sweden either, although they do account for 61.9%. Denmark, Norway and Finland have all seen multiple large exits in the last couple of years, proving that there’s exceptional companies to be found right across the region.
We’ve written a lot about how First North and a strong public exchange in the Nordics offers the region’s tech companies a great avenue of going public and achieving liquidity, but this has to be the strongest use case yet.
42.9% of these $100 million+ VC-backed exits were achieved by an IPO. This clearly demonstrates the importance of having a thriving local public market as an option available to the tech sector. These tech IPOs actually helped propel First North to overtake London as Europe’s dominant exchange for IPO volume and value in the first half of 2016.
This is my favourite statistic: It’s not 21 just-scraping-past-$100M exits, in fact, there’s just 5 (23.81%) between $100-200 million, these exits are almost as likely to be full ‘unicorns’ as they are in this lower end of the range.
This chart is a great demonstration of just how many solid VC-backed returns are happening in the region right now, in fact, the median size of a $100 million+ VC backed exit is $350 million, certainly something not to be sniffed at.
For the more curious amongst you: Supercell, King, Qlik and Sitecore were the four ‘unicorns’ originating from the Nordics in recent years.
The good news for the local ecosystem is that as well as a thriving public market we also have companies able to provide exit routes for our companies by having the resources to acquire them at a $100 million+ price-tag. The case for the United States, China and the United Kingdom being the main markets we look to outside of the region for opportunities has never been stronger.
Despite the lack of coverage from the world’s tech media, there’s clearly a lot of impressive activity happening in the (larger) exit space in the Nordics right now. One of the main problems, is that Europe’s tech media don’t focus that heavily on local exchanges, so in spite of First North’s recent prominence a lot of these exits go under-reported, and with 42.7% of the Nordics $100 million+ VC-backed exits happening there, here’s the reason why a lot have gone under the radar.
Nonetheless just because you might not read about them doesn’t mean they’re not happening, thankfully, it’s quite the opposite.