Silicon Valley is often seen as the be all and end all of tech startups. But as European countries seek new ways to boost flagging economies, digital businesses are flourishing across the continent. Here’s a primer on ten of the most interesting and best funded European tech companies over the last two years.
Latest funding round: $110m
Boutiques are an attractive prospect for the modern bohemian townscape, but their unique charm isn’t always profitable. In steps FarFetch – an online marketplace linking small fashion outlets with a global online audience.
Significant investments from Vogue publisher Condé Nast and software company DST Global have led to the acquisition of their first ‘bricks and mortar’ store in London boutique Browns, and new offices in seven separate countries. Their global empire has seen the site translated into nine languages, and has already made them a ‘unicorn’ with a valuation of over $1bn.
Latest funding round: $1bn
The Swedish streaming giant has come a long way since its home debut in 2008. An idea born when the iPod was still hitting its stride, Spotify made waves with its UK launch in 2009 before expanding slowly across the rest of Europe. A long period of negotiation with record companies led to the US release in 2011, and with it came globe-conquering success.
While Spotify currently has the ‘Twitter conundrum’ of turning a profit from its massive audience – with a constant dialogue over the amount paid per stream to record labels and their artists – its expansion continues almost unabated, and the funding keeps rolling in with it.
Uber’s rapid international expansion might give the impression that there isn’t much competition from similar businesses. But as we’ve seen recently with the sale of their Chinese business, local ridesharing alternatives can leap into the fray with a deeper understanding of their markets. Cabify is one such company.
Founded two years after Uber, Cabify is the dominant force in Spain, Portugal and much of Latin America, with over a million drivers as of 2016.
Investment from Japanese e-commerce giant Rakuten has driven further expansion in South America and the Caribbean, while offshoots such as Cabify Bike and the co-operative Cabify Taxi scheme (hiring rather than competing with taxi drivers) have kept it in local authorities’ good books. Fixed pricing, optimum route calculation and premium vehicles look set to ensure that Uber and other competitors will struggle to take back its dominant market share.
4. Avast Software
Location: Czech Republic
Latest funding round: Undisclosed
From battling for the free anti-virus crown with AVG, Avast has developed into one of the world’s premier security software solutions. The fall of industry giants McAfee – recently sold by parent company Intel – and Norton due to their bloated, resource heavy software has left the way clear for competitors, and Avast’s status as one of the leading free anti-virus solutions put it in a prime position.
The company’s massive install base, prudent early entry into the mobile anti-virus market and spotless reputation has allowed it to transition from freeware to paid consumer options and business solutions, gaining 18% of the total antivirus market at last count.
5. CCP Games
Latest funding round: $30m
The veteran videogame developer is famous for hiring in-house economists to manage its 1-million strong space simulation Eve Online, with an in-game economy boasting Enron-esque heists and Lehmann-like crashes. Having only launched two new properties in nearly two decades, CCP’s latest focus is the burgeoning world of virtual reality.
Their space dogfight simulator Eve: Valkyrie has been heralded as one of the platform’s early technological triumphs, and shooter Gunjack has garnered critical praise on Samsung’s mobile Gear VR. Investors may be wary after the cancellation of World of Darkness in 2014, a colossal project that had been the studio’s predominant focus for five years.
But this needn’t be terminal: industry rival Blizzard Entertainment cancelled its follow up to smash hit World of Warcraft in 2014 after seven years of development, and the resulting assets turned into Overwatch, now the most popular game of 2016.
Latest funding round: $27m
Single niche marketplaces are a major growth area, and leading the pack is Lithuania’s online clothes store Vinted. Pitched as eBay meets Facebook for clothes, the platform allows women to buy, sell and swap old garments with the added features of a social network.
The startup has distinguished itself with canny marketing, preferring the term ‘pre-loved’ to secondhand, and carries the familiar aesthetic of popular platforms Pinterest and Instagram, complete with a feed of photos, likes and comments.
Since opening in 2008, Vinted has expanded to the US and seven different European markets, and is becoming a major presence on mobile. The constant desire to refresh your wardrobe and barter your way to a vintage top makes it a uniquely compulsive shopping experience, and more of a community than a B2C e-commerce site.
Latest funding round: kr160m (~$19.5m)
The only company amongst Europe’s tech startup elite that isn’t pitching a digital service or platform, poLight have carved themselves a slice of the lucrative mobile phone business: specifically, the camera lens. Given the myriad different Android variants, an emerging Chinese market and the two cameras becoming almost a bigger feature in phones than the ability to call people, the growth potential here is huge.
And Carl Zeiss is perhaps the only name currently associated with a quality camera, despite the fact that it’s more often poor software configuration that scuppers a phone’s photo quality. Building a portfolio of quality hardware and pushing the brand could make poLight a huge offbeat success story.
Latest funding round: $8m
There’s a distinct feeling amongst language learners that the best methods for teaching haven’t been exhausted. Enter Lingvist: a new approach from an Estonian company based on big data and algorithms. The software chooses the vocabulary it teaches you based on the words people actually use, rather than the overly formal language of most legacy software.
It also promises an adaptive approach that will teach words differently based on how quickly the user absorbs them. With the continuing pace of globalisation and hectic lifestyles making tutoring more difficult, there is plenty of room for new linguistic software to exploit, and Lingvist’s expansion from French and English into Russian, Spanish, German and Portuguese will put it in a prime position.
Latest funding round: $6.71m
Competing with Google on software development would seem like a hiding to nothing. But in the emerging field of autonomous or ‘self driving’ vehicles, creative solutions can pip sheer manpower.
Based in car capital Germany but working from its Hungarian parent company’s offices, AdasWorks is looking to utilise developments in low power, high performance computer chips to run multiple car systems in tandem.
This combination of numerous sensors and functions promises to provide more data for instant analysis, enabling an autonomous car to make crucial decisions more quickly than a human being.
Given the existing dangers of driving and the hesitation around trusting computers, the stakes are high and the prospects are long term. But the possibility that this technology will dominate the car industry in future has clearly made this an extremely enticing gamble.
Latest funding round: $2m
Google and Amazon stand as proof that people don’t mind monopolies if the service is good. But for all their algorithms, search engines aren’t always best equipped to deal with the complexities of hundreds of languages.
This is apparently a particular problem in Albania, where not only was there no effective search engine, but much of the pertinent information to Albanians hadn’t even been digitised. Gjirafa is part search engine and part social movement, helping the country to get online by cataloguing its businesses and venues for public record.
It’s a noble effort and a sound business strategy, as well as a reminder that local businesses will always have a leg up on even the biggest competitors. Take Yahoo’s Japanese division, where site-building tool Geocities is still active, and the search engine is the country’s largest. Some things are beyond explanation.
Author: As the founder of Open A European Company.com, Heather Landau knows European startups. With a total of 25 years combined experience in international marketing and business development, Heather is a leading authority on starting a business in Europe, and operates similar company formation services in the US and the rest of the world.
Prior to SAAC, Heather worked in the IT research industry, selling research solutions to the likes of Hewlett Packard, IBM, Microsoft and Intel, as well as information providers Reuters. On top of her knack for helping SMEs develop into the USA, Australia and Europe, Heather holds a BA (Hons) in Modern Languages (French/Italian), and is conversational in German and Spanish.