markus wagner - i5invest - austria - stanford engineering - jan 26 2015
TRANSCRIPT
Startup Ecosystem in Austria
Markus Wagner 26th of Jan. 2015; @MarkusWagner
CEO - i5growth Inc. (Palo Alto)
Chairmen of Adv. Board - i5invest seed capital (Austria/Vienna)
Board AustrianStartups – Austrian Startup Association (non-profit)
Investment Committee Member – SpeedInvest (seed and Series A fund in Austria)
European Entrepreneurship & Innovation @ Stanford Engineering
…known for Mozart, Sissi & Sound of Music
…known for – Music & Culture
Strong Austrian Brands
and recently known for a lively, liberal culture & tech scene
Austrian Facts & Figures Popula'on: 8,5mln Capital: Vienna (high diversity of industries and services) Vienna Region: 2,6mln Language: German German speaking market: ~100mln #1 in Europe: lowest unemployment rate #1 worldwide: quality of life (Mercer Study 2014) GDP per capita: #13 (IMF) Industry 29%, Service 69%, Agriculture 1,5% (Tourism 6%) ~4hours drive radius: Bra'slava (45min) Krakow, Zagreb, Budapest, Munich, Prague, Brno, Ljubljana Significant Eastern and Balkans Investor: finance, retail, telecom Vienna
4hours car drive radius
Vienna‘s Biggest Asset: 180.000 students in Vienna (40% int.)
my background (i5invest seed capital / i5growth Inc. / AustrianStartup)
Timeline: Markus, Austrian Startup Scene
2000 2004 2006 2002 2008 2010 2012 2014 1997
3united AG (my first Exit)
Mobile Music Mobile Content &
Community Portals TV, Radio & Print Gambling &
Betting
Mobile Operators
3united key verticals
Mobile Operator Clients
COIN Platform Application Layer Applications & Services
• Mobile Portal • Web Portal • Personalization • Recommender • Rich mobile Clients (J2ME/Symbian) • Radio Station Module • Merchant Module • Promotion Engine • Community Module • Dual Delivery • Multi Vendor Content Management • Multiparty Reporting • Automatic Meta Data Extraction
• Dating & Matchmaking • Web Charging • Content Download Server • MMS Feature Proxy • WAP Application Suite (Entertainment) • WinnerZone Promotion Engine • m-Ticketing • CD/DVD Retail Module • Information Services (Push/Pull) • Content • WAP Portals (on- deck, off-deck) • CRM Module
• Votings/TED • On-Air Chat • Sweepstakes • Call-in Shows • Videotext • Dating/Flirting • Content Downloads • Mobile Media Portal • Music Recognition • Message2DJ • TV/Radio show reminder • Information Services (Push/Pull) • Astrology tools • TV on Mobile • On-Air Games • CRM • Content
• Mobile Clients Gambling • Mobile Clients Betting • Gambling Back-ends • Application Download Platform • Transaction Proxy Framework • Account Admin • Multiparty Reporting • Back-end & Payment Integration Mod. • Provisioning Platform • Authentication Management • CRM Platform
• DRM • Handset DB • Rendering
Support
• Premium Video Delivery • m-Commerce
Payment
• Premium MMS • Premium SMS
COIN Platform Transaction Layer Mobile Multi-Media Middleware & Connectivity
13 Countries
100+ Employees Highly profitable (30%+ EBIT Margin)
2000 2004 2006 2002 2008 2010 2012 2014 1997
Timeline: Markus, Austrian Startup Scene
2000 2004 2006 2002 2008 2010 2012 2014 1997
IncubaSon / Company Building
AcceleraSon + Seed Capital
M&A and Corporate Dev.
i5growth Inc. / innovaSoncenter.eu
A group of serial entrepreneurs who invest invest their money and 'me
Timeline: Markus, Austrian Startup Scene
Overview
We focus on max 2 new companies per year – we aren’t spray & pray investors. We focus on sector expertise, mostly strong IP/technology, international/US markets, rarely copycat business models
WE ARE LONG TERM PARTNERS (through all stages) START-UP MENTORING SEED FUNDING CORPORATE DEVELOPMENT / M&A ADVISORY (portfolio, friends & family network)
Portfolio Overview
#inspire, #innovate, #incubate, #invest, #internationalize
The Austrian Startup
Ecosystem
2000 2004 2006 2002 2008 2010 2012 2014 1997
March.fifteen.
The Decline of Local
Series A/B
Government Series A Funds / Support
Public R&D (Pre-‐) Seed. Support
Second Wave of Private Ini'a'ves
The Raise of An Amazing Startup Scene
i5growth Inc. / innovaSoncenter.eu
Timeline: Markus, Austrian Startup Scene
Investments 1999 – 2013 (in Mio. €)
Development: Share VC only
Austrian Funds
Source: EVCA PEREP_Analytics | AVCO (May 2014)
Private Equity & Venture Capital in Austria
Source: EVCA PEREP_Analytics | AVCO (May 2014)
Private Equity & Venture Capital in Austria
Investments 2013 (in %)
GDP Share: VC only (PE not included) - Companies in Europe
Private Equity & Venture Capital in Austria
Source: EVCA PEREP_Analytics | AVCO (May 2014)
into Austrian Companies: 539,9
€ 88,0 Mio. Investments made by Austrian Funds
20,5
67,5
472,4
€ 539,9 Mio. Investments in Austrian Companies
0,173 % GDP share
0,028 % GDP share
by Austrian Funds: 88,0
Abroad
Czech Republic 7,0 Mio. Bulgaria 6,0 Mio. Poland 5,2 Mio. Germany 1,6 Mio. Turkey 0,4 Mio. Other 0,3 Mio.
Investments 2013 (in Mio. €)
Flow: PE & VC
2,500 Visitors at the Festival 2700 Challenge applications in the last 30 months 50% WESTERN EUROPE 37% EASTERN EUROPE 7% NORTHERN EUROPE 6% REST OF THE WORLD
Startup Ecosystem is booming
Vienna Austria
significant as well: Linz, Graz
S'll, you beYer should interna'onalize early!
Austrian Ecosystem Exits / Notable Events
Notable EXITS (star'ng by 2010): • 2010: fa[oogoo – Digital River • 2010: greentube -‐ NovomaSc • 2010: jajah -‐ Telefonica • 2010: 123people -‐ PagesJaunes • 2011: RF-‐iT SoluSons – Enso Detego • 2011: sensordynamics -‐ Maxim • 2011: silverserver – Tele2 • 2011: redcoon – Metro’s Media Saturn • 2011: dynaTrace -‐ Compuware • 2011: payoluSon – Moneybookers / Skrill • 2011: checkfelix.com -‐ KAYAK • 2012: Kununu -‐ Xing • 2012: Tupalo – Herold / European Directories • 2012: Arztsuche24 – Herold / European Directories • 2012: Blue-‐tomato – Zumiez Inc. • 2012: paysafecard -‐ Skrill • 2013: tripwolf – German Publisher • 2013: SolveDirect – Cisco • 2013: RuntasSc – Axel Springer • 2014: Immobilien.net – ImmobilienScout24 • 2014: Wikidocs – Atlassian • 2014: MobFox – Matomy Media Group
(MTMY:LSE)
Notable Events (star'ng by 2012):
• 2012: Andreessen Horowitz/CiS Ventures investment into Jumio
• 2012: Blossom investment of seedcamp
• 2013: CodeShip investment of seedcamp and Techstars
• 2013: Former Expedia CEO invests in TourRadar
• 2014: CodeShip receives US Series A
• 2014: Foundertalks.org launches (brings YC alumni to Austria for experience exchange)
• 2014: Ulmon investment of Global Founders Capital
• 2014: 100% Austrian Team in YC patch
• 2014: Talenthouse investment of ProSiebenSat.1 Media AG
• 2014: Austrian team joins YC producthunt.com (founding team member)
• 2014: Austrian flatout joins Cisco’s EIR program
• 2014: Austrian Crate.io TechCrunch Disrupt Europe Winner
• 2015: ChatGrape Betaworks (US) investment
Ecosystem Summary
What is great? • Many great entrepreneurs • Established role models • Access to German speaking market • Amazing Quality of Life, low Cost of Living, high Social Security
• Highly diversified industry ver'cals • Established angel investor scene (aaia, i2)
• Public • R&D grants • incubators at universiSes • VC co-‐investments
• Poten'al to become the significant CEE hub (central & eastern European hub)
• Ecosystem has reached cri'cal mass – more & more exits, more & more angels, more & more & more exits, …
Challenges & Coping Strategies
• Market size is small à Companies keep dev. team in Austria and move business unit to USA
• Not many local series A/series B op'ons à Join internaSonal accelerators à Companies keep dev. in Austria and move business unit to USA / or flip à Fundraising in Germany/UK/France à Chose cash efficient business models (low burn) à Chose business models that soon will generate revenues (early revenues) à Start a Series A/B fund
• No local M&A or IPO market à go internaSonal, start early
• No investment incen'ves for angels
• Stock Op'on Plans are hard to implement
Examples of huge variety of Austrian tech startups/
companies
Example: World market leader for V-shaped book scanner
Example: Next Generation Digital Sheet Music App
Example: Europe’s independent #1 Ski Rental
Example: The World's leading Augmented Reality SDK
Example: Big Data for Media Planning
Example: Europe’s mobile #1 ad platform
hrp://www.cloudswave.com/images/orig/mobfox_for_adverSsers1373364224719.png
Example: technology leader robust networked safety controls
Example: TechCrunch Disrupt Europe Winner 2014
The Distributed Database
Austria: Highly educated founders with passion – ready
for the global market
Thank you! @MarkusWagner or Linkedin