Author: Kris Hróbjartsson (Page 1 of 11)

Florealis closes $3.8m funding round led by NSA Ventures

Pharmaceutical company Florealis just announced it had closes a $3.9m funding round, led by NSA Ventures. Former investors, Einvala, and other private investors also took part in the funding round.

“Exciting times ahead for us, following the addition to our investor group,” said Kolbrún Hrafnkelsdóttir, CEO of Florealis, in a statement. “Our first products have been received very well in Iceland, and we’re ramping up marketing and sales efforts in the Nordics.”

The company, which produces herbal medicines, recently closed a deal with leading pharmaceutical chains in Sweden, that will carry Florealis’ products. The funding will be used to support marketing and sales efforts, as well as developing more products later in the year.

Huld Magnúsdóttir, CEO of NSA Ventures, said in a statement: “Florealis falls well in line with the fund’s investment strategy and are excited to lead a group of investors to this deal.”

The Year of the Seed Round: The 2017 Funding Report

The past year had several interesting highlights when looking at the funding landscape. The $240m monster round invested in WuXi NextCODE, the first investment from Index Ventures, and the first Icelandic startup (that we know of) to receive investment from only foreign sources – Authenteq. In this funding report we’ll go over the highlevel datapoints and discuss the developments in the ecosystem.

Note: Although based on Icelandic innovation, we decided not to include the WuXi NextCODE funding round in our analysis.

A record number of investments

This year surpassed 2016’s record in terms of tracked investments, with 22 investments on record. The number of investments is growing, albeit slowly, but whether that is due to more investments or better availability of data is uncertain.

But amount invested has declined

At the same time that we’ve never recorded as many investments, the amount recorded has declined. The total investment amount this year was around $35m, down from roughly $57m last year and ~$190m in 2015, which included three big investments that skew the comparison.

Never as much capital in early stage

Probably the most telling graph of this report is the following one where we look at the amount of capital that comes from smaller early stage rounds ($2.4m or less) and bigger, later stage round ($2.5m and up).

In 2017, almost half of all invested capital was in smaller rounds. This is massive change from earlier years where most of the capital invested came from larger rounds, often made by international investors.

This also shows when we break down the number of rounds per year into size brackets. In 2017, the overview is very much skewed to the left: that is, most rounds are small and we don’t have bigger rounds to balance it out.

This is echoed in the fact that only four (~19%) of the investments made in 2017 included foreign investors: Meniga, Teatime Games, Authenteq, and Takumi.

Another interesting point is that Investa, the early stage investment fund run by the likes of Hjálmar Gíslason, Hilmar Gunnarsson and Jói Sig, was the most active investor in the Icelandic ecosystem. They invested in three companies: Teatime Games, Viska Learning and Travelade.

Five investors’ first investment in Iceland

Although we saw fewer rounds with international investors, we added to the list of foreign VC’s that have invested in Icelandic companies. In addition, we saw (to our knowledge) the first seed round entirely funded by foreign investors, when Authenteq raised $1.3m. The new investors can be seen below:

No signs of seasonality yet

We’ve tried to use the data to build up some kind of projections or high-level overview of when investments happen in Iceland, but haven’t been succesful. We can’t see any seasonality in the data, which suggests that summer is just a good a time for raising money as winter. However, we have too little data for any analysis on this to have real meaning.

Exits

One of the most important stories of the year, was of NetApp’s acquisition of Greenqloud for $51m in cash. It profited all the investors (one of which has already invested in another startup), and the fact that NetApp looks to further develop the office in Reykjavik is great news for the tech ecosystem.

Another, smaller and less publicised exit was the sale of audiobook publisher Skynjun to Swedish Storytel for €200k.

What it means in the bigger picture

A lot of small, early stage investments in one year suggests that – if the companies are successful – we’ll see more bigger rounds in the upcoming 12-24 months. This, in fact, is already showing. In the first two weeks of 2018, three investments were announced: Oculus’ $20.3 Series B, Solid Clouds $2.5m Series A and a convertible bond by Kerecis. All three had previously raised smaller amounts from Icelandic investors.

Other “Icelandic” companies in the wild

Apart from the startups and tech companies in Iceland that we track, there are Icelander founded or co-founded companies that raised capital this year:

  • Klang Games, maker of the endless runner ReRunner, and now working on Seed, a simulation where the goal is to ensure the survival of humanity. The founding team includes Oddur Snær Magnússon, Ívar Emilsson and Mundi Vondi.
  • Catapult, a on demand staffing platform that helps people get temporary work and companies get workers, co-founded by Óli Johnson
  • Vitro Labs, a biotech company that’s working on 3D tissue engineering and went through Y Combinator in 2017. Co-founded by Ingvar Helgason

Note: While we try to catch all investments, we never can. We mostly look to specific funding rounds, and don’t go after things like bridge loans or funding extensions, although we do cover them when the data is readily available. We time the investments based on their announcement, not the date of signing. Our methods and rules are there to try to ensure compatability with other databases and data sources.

Solid Clouds raises $2.5m from Kjölur fjárfestingarfélag

Solid Clouds, the game developer working on Space MMO game Starborne, just announced a $2.5m (270m ISK) funding round led by Kjölur fjárfestingarfélag. Other previous investors also participated in the round. In addition, the company received a $475.000 (50m ISK) growth grant from the Technology Development Fund.

“We’re happy to have closed this financing, and being joined by as experienced an investor as Kjölur,” CEO and co-founder Stefán Gunnarsson said in a statement. “The investment will be used to fund marketing and growth, as well as a mobile version of the game.”

Starborne is a real-time, massively multiplayer strategy game played by thousands of players at a time. “We’ve been watching Solid Clouds for some time because of their revolutionary game that looks very promising,” says Guðmundur Ingi Jónsson Manager of Kjölur fjárfestingafélag. “We’re excited to share our experience with the team on building a tech company.” Guðmundur takes a seat on the board of directors following the funding.

Kjölur is known in tech circles for being one of the lead investors in Greenqloud, that was sold to NetApp last year.

 

Medical fish skin company Kerecis closes $3m convertible note

Ísafjörður based Kerecis, that creates fish skin based products to help with healing of wounds, recently announced it had sold a $3m convertible note to its current investors. All the largest investors in the company participated, and the note was oversubscribed.

Kerecis was in NSA Ventures portfolio until 2014 when the fund sold its 26% stake to a group of investors that included the founder. The purchase price was undisclosed.

Oculis raises $20.3m Series B round to advance treatment for Ophthalmic Diseases

Oculis, an Icelandic life sciences company, just announced a $20.3m (20m CHF) series B round led by a syndicate of leading life science venture funds including Bay City Capital, Novartis Venture Fund and Pivotal bioVenture Partners. Existing investors, including Brunnur Ventures and Silfurberg, also participated in the financing.

“I am extremely pleased to be joining such a great team to develop what could be the next generation of ophthalmic treatments,” said Dr. Riad Sherif, who has been appointed CEO of the company. “Oculis founders have meticulously developed the novel SNP technology that improves both the ability to formulate drugs as eye drops and their bioavailability in eye tissues including the posterior segment.”

The funds will be used to advance the clinical development of the Company’s lead program OC-118, a proprietary topical product currently in a clinical trial for the treatment of Diabetic Macular Edema (DME), the leading cause of blindness in young adults in developed countries.

Following the financing, the company will relocate its headquarters to Switzerland, while its R&D will remain in Iceland.

The company previously raised an undisclosed round from Brunnur Ventures and Silfurberg.

Top tech and startup news from 2017

We’ve compiled a list of what we believe are the most notable and important news and happenings in the Icelandic startup and tech ecosystem in 2017.

GreenQloud acquired by NetApp for $51 million

Although this list is not in any particular order, NetApp’s acquisition of GreenQloud  is likely the most important for the Icelandic startup scene as a whole. It’s both a successful exit for investors (all of whom made money on their investment), the tech ecosystem (because NetApp is investing heavily in building an office in Iceland), and founders / employees (many of whom had options and / or will move into interesting roles at NetApp). In addition, NSA Ventures was an investor, which means that the fund – whose role and purpose is being discussed in a working group – has some money to invest.

WuXi-NextCODE raises $240 million from Sequoia China and others

One part of the startup and tech scene in Iceland that isn’t covered as much as the more approachable traditional software startups is the genomics space. And this year we had huge news on that front. WuXi-NextCODE, the former DeCODE spinoff that was later acquired by WuXi for $65m in cash (hence the name WuXi-NextCODE), raised a monster round this year, $240m from Sequoia’s China arm. Led by CEO Hannes Smárason, the company has offices all over the world, with a big development office in Reykjavik, Iceland.

Teatime Game’s seed round marks Index Ventures’ first investment in Iceland

Last year (2016) was the year that QuizUp – the startup ecosystems darling child – announced they were closing their doors. This year (2017) is the year that a part of the core team behind QuizUp launched their next venture into the mobile gaming space. The team raised a round from Index Ventures, probably Europe’s best venture fund, which had never invested in Iceland before (the Icelandic connection might have helped there).

An Icelander on stage at Apple’s iPhone X keynote

The fall of 2017 was the first time (to our knowledge, please let us know if we’re wrong) that an Icelander was featured on the big stage at Apple’s keynote presentation. At the keynote, where the company among other things introduced the iPhone X, founder and CEO of Directive Games Atli Már Sveinsson showcased Apple’s AR Kit possibilities with their game Machines.

The new government’s policy document mentions innovation 19 times

Following scandals and a new election, a new government comprised of the Left-Green party, the Independence Party and the Progressive Party, unveiled their big policy document for the next four years. “Innovation” was mentioned 19 times, with big promises on developing the ecosystem for startups and tech companies further. And although the new government hasn’t put any of it into action yet, they’ve only been at it for several weeks, and we’re willing to give them the benefit of the doubt.

CCP lays off ~100 people, scaling down VR efforts, focusing on EVE universe

In a somewhat surprising move, to outsiders at least, CCP announced they were laying off around 100 people and shuttering their VR ambitions, for now at least. The company closed its development office in Atlanta and will sold its operations in Newcastle. Following the layoffs the company shifted its focus on two previously announced projects: Project Nova, a first person shooter for the PC, and Project Aurora, a free to play mobile game. The company cites unfavorable market conditions in the VR market (i.e. too little sales and too little near-term potential) as the main reason for the move.

Crowberry Capital closes its first fund making it the fourth private VC fund in Iceland

Last summer the trio behind Crowberry Capital announced the first close of their new VC fund. Helga Valfells, Hekla Arnardóttir and Jenný Ruth Hrafnsdóttir, who previously worked at NSA Ventures, left their jobs at the end of 2016 to venture into their own fund. The fund’s first close was at 4bn ISK (~$38m) backed by a mix of institutional investors (pension funds) and individuals.

Klappir Green Solutions listed on First North

Klappir Green Solutions, a consulting and software solutions company focused on sustainability and responsible operations, listed its shares on the First North stock exchange. While not currently a popular way for startups to get liquidity, it might be a precursor of what’s to come, as some have suggested that startups should look more towards listing.

What do you think were the most important tech and startup news of 2017? Let us know via email or in the comments (on Facebook).

A reminder that you can sign up for our newsletter with news and analysis about the Icelandic startup and tech scene. Sign up here.

Travel tech startup Travelade raises $1.6m led by Crowberry Capital

Travelade, a travel platform that helps millennials discover and book travel activities tailored to their tastes, just announced a $1.6m financing round led by Iceland’s newest venture capital fund, Crowberry Capital. Other participating investors are angel group Investa and several individuals. Hekla Arnardóttir from Crowberry and Hjálmar Gíslason from Investa will join the company’s board of directors.

“Our mission is to make it as easy to find activities for your dream vacation as it is to listen to music on Spotify,” says Andri Heiðar Kristinsson, CEO and co-founder of Travelade. “Flights and hotels are already easy to find, compare and book online, but finding unique experiences tailored to your personal taste is hard. We help people collect ideas and design their dream vacation.”

Travelade wants to provide users with a beautiful and easy to use interface, to help them plan their vacation. On Travelade, users can plan activities, both based on tips from travel bloggers and professional tour operators. The company recently received a grant from the Technology Development Fund to develop AI that will tailor suggestions based on each individual’s travel style. The technology will be developed with Cadia, the AI research center at the University of Reykjavik.

“We at Crowberry Capital are thrilled to announce Travelade as the fund’s first investment,” says Hekla Arnardóttir of Crowberry Capital. “Travelade has an experienced, driven and ambitious founding team and it’s great to see that the tourist boom in Iceland is begetting born-global travel tech companies. We believe that Travelade is well timed to participate in the phenomenal growth in international travel and Travelade is set to lead the way when it comes to helping independent travelers plan and dream their next adventure.”

Travelade has launched it’s product in Iceland and Bosnia and plans on growing further in the coming months.

Solfar unveils newest VR project: In Death, a roguelite shooter

Solfar, the Icelandic VR studio founded by CCP veterans and backed by Reaktor Ventures, Inventure, NSA Ventures and more, just unveiled their next project after Everest VR. It’s called In Death and they described it as a “roguelite shooter, set in the godless afterlife.”

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Nordic Style Magazine becomes first Icelandic Magazine distributed in the US

The Icelandic startup Nordic Style Magazine has signed a sales and distribution agreement with the world’s largest bookstore, Barnes & Noble.  Nordic Style Magazine gives its global readers daily updates from the Nordic design, fashion, art and culture scene via its site, www.nordicstylemag.com.  Nordic Style has scouted new designers and talents, which in many cases have been featured for the first time on their platform and attracted new opportunities as a result. 

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Music education game Mussila re-released on iOS and Android

Rosamosi, the game studio behind the Mussila music education apps, just released a new version of their original Mussila game. It is available on iOS and Android. According to a statement, the new Mussila game is a “more exciting, and even more educative format. It has new more easily relatable characters, more fun and more interactivity.” They also report that kids that play the Mussila game learn music 20% faster than those that don’t.

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Nortstack – Reporting and analysis of the Icelandic startup scene