VC Funding In CEE Report - 2020

Konrad Koncerewicz VC Community Builder, Vestbee

In this report, we have included the disclosed VC rounds that have been made public before the end of the year or provided by our VC & startup community. It does not include grants and transactions below €50k. Additionally, although we’re always happy to see startups operating in CEE, we have decided to focus only on companies that originate from CEE, self-identify as CEE companies or there is a significant presence of the CEE founder.

Sources: Vestbee VC & startup community, startup press releases, web & social media monitoring, Crunchbase, PFR (Polish Development Fund).

 

COVID-19 was one of the biggest challenges and game-changers in 2020 that hit the global startup and VC scene causing not only shifts in investors, startups and customer behaviour but also leading to the massive global digitalization that brought to startups and VC investors the opportunity to envision upcoming changes.

Also moving startup fundraising, investment process, events and even closing deals online resulted in a memorable year on the CEE startup & VC scene despite its volatility and consecutive lockdowns. 

So how have these changes affected 2020 in terms of VC transactions in the CEE region? Let’s move on to the comprehensive overview of investments in Central & Eastern Europe and take closer look at the details.

Startup investment rounds in CEE in 2020

> Number of funding rounds: 734
> The biggest disclosed investment rounds: Bolt - Series D - €150M, Iceye - Series C - €73M,  Brainly - Series D - €66M, Booksy - Venture series - €60M.
> Total value of funding closed  in CEE: over €1B*
> Countries with the majority of funding rounds: Poland - 313, Hungary - 110, Estonia - 97 rounds
> The most active VC funds: Hiventures, Fil Rouge Capital, Startup Wise Guys, CB Investment Management, Smok VC, Polish Venture Fund, KnowledgeHub, CZYSTA3.VC, Netrix Ventures, Brave VC
>The most appreciated industries: Artificial Intelligence, Big Data, Analytics, E-commerce, Advertising, Healthcare, Blockchain, Financial Services, Marketplaces, Agriculture.

*101 rounds undisclosed in terms of the transaction value

The COVID-19 outburst caused 2020 to be a volatile year for startups and VC funds. Looking closer at the first months of 2020, both the number and size of investments remained at a similar level in the entire 1st and 2nd quarter. However, the situation changed in the 3rd and 4th quarter after the initial dust was settled and both startups and investors realized that the effects of COVID-19 will stay with us longer and there is a need to adapt all operations to the prevailing conditions. 

Despite these specific conditions, myriad startups managed to close investment rounds in 2020 (734 funding rounds exceeding €1B in funding - it is worth noting that the data provided concerns disclosed rounds, and the scale of financing in the entire CEE was undeniably higher). Among the arising opportunities and most appreciated investment directions were solutions based on Artificial Intelligence and related fields like analytics & big data, but we have also noticed the rapidly increasing interest in tele-medicine, remote personal care, medical equipment, home delivery, food processing, remote work, online education and smart cities. 

Looking at quarters the value of VC investments in Q1 and Q2 remained at the similar level, while between Q2 and Q3 increased by 56%, and between Q3 and Q4 by the next 120%, reaching an astonishing amount of over €550M. The rise in value was accompanied by an increase in the number of startups that obtained financing - 165 investment rounds in Q1, then 169 in Q2 and 182 in Q3, ending with 218 in Q4.

The biggest investment rounds were secured by Estonian Bolt - €150M, Polish/Finish Iceye - €73M, Polish Brainly - €66M, and Polish Booksy - €60M. The majority of the investment rounds were raised by startups originating from Poland, Hungary and Estonia, that secured 313, 110 and 97 rounds respectively. As strong position of Poland and Estonia is not surprising due to the fact that Poland is the largest ecosystem in CEE with large pool of startups  and many active investors (over €430M invested in startups) and Estonia has many interesting startups and great legal and market conditions to develop companies, Hungary may be a great eye-opener. In 2020 Hungarian startups secured more than €50M in 110 funding rounds and this clearly shows that Hungary has also put emphasis on the development of the startup ecosystem, more and more interesting startups are being launched there, and in the coming years we can expect further impressive investments.

Among the most active investors, we can distinguish Hungarian Hiventures, Croatian Fil Rouge Capital, Estonian Startup Wise Guys, Slovakian CB Investment Management, And Polish Smok VC, Polish Venture Fund, KnowledgeHub, CZYSTA3.VC, Netrix Ventures, Brave VC.


Now, let’s take a look at the overview of quarterly analysis of VC investments.
 

Startup investment rounds in CEE in Q4 2020

> Number of funding rounds: 218
> The biggest disclosed investment round: Bolt - Series D - €150M, Brainly - Series D - €66M, Booksy - Venture series - €60M.
> Total value of funding closed  in CEE: over €550M*
> Countries with the majority of funding rounds: Poland - 100, Hungary - 40, Estonia - 28 rounds
> The most active VC funds: Hiventures, Fil Rouge Capital, Startup Wise Guys
> The most appreciated industries: Analytics, Artificial Intelligence, Banking, E-commerce, Mobility, Education, Beauty. 

*97 rounds undisclosed in terms of the transaction value

In the 4th quarter of 2020, 218 investment rounds were closed in Central and Eastern Europe, while only 121 were fully disclosed in terms of company details, funding amount, date, and participating investors. According to fully disclosed data, 35 funding rounds took place in October, 36 in November, and 50 in December. Each subsequent month of the fourth quarter, despite the prevailing pandemic, was getting more and more interesting due to the amount of funds present on the market. In CEE the quarter started with a quite lazy October with total VC funding of over €30M, then went through a more active November with its €90M, to finally end with a really strong December, in which startups secured more than €250M. The total value of investments reached over €550M. 

The most active countries in terms of the majority of funding rounds in Q4 were Poland, Hungary and Estonia which secured 100, 40 and 28 rounds respectively. Poland, as the biggest VC ecosystem in CEE, with many active funds and private investors reached an astonishing number of investments compared to other countries, but Hungary's and Estonia’s outcomes we may also assume as a pleasant and unpredictable surprise. The biggest funding rounds were secured by startups from Poland and Estonia. Estonian Bolt closed €150M, Polish Brainly - €66M, Polish Booksy - €60M, while among other popular countries were Croatia, Hungary, and Lithuania. 

Taking a look at sectors, in the fourth quarter, funds were mainly invested into Analytics, Artificial Intelligence, Banking, E-commerce, Mobility, Education and Beauty and the most active investors in terms of the number of financing rounds were Hiventures, Fil Rouge Capital and Startup Wise Guys.

Find out more in  VC Funding In CEE Report - 4Q 2020

Startup investment rounds in CEE in Q3 2020

> Number of funding rounds: 182
> The biggest disclosed investment round: Iceye - Series C - €73M, Uncapped - Venture Series - €22M, Veriff - Convertible Note - €13.8M.
> Total value of funding closed  in CEE: over €250M*
> Countries with the majority of funding rounds: Poland - 88, Estonia - 25, Hungary - 22
> The most active VC funds: Hiventures, Fil Rouge Capital, CB Investment Management
> The most appreciated industries: Artificial Intelligence, FinTech, Analytics, Advertising, Healthcare.

*81 rounds undisclosed in terms of the transaction value

In the 3rd quarter of 2020, 182 investment rounds were closed in Central and Eastern Europe, while 101 were fully disclosed in terms of company details, funding amount, date and participating investors. According to available data, 32 of funding rounds took place in July, 28 in August and 41 in September. We started the quarter with less active July and August which was related to the holidays and the period of stagnation on the VC market, but we finished with surprising September, in which startups secured more than €120M in 41 funding rounds. The total value of investments (including the value of undisclosed ones) reached over €250M. 

The most active countries in terms of the majority of funding rounds in Q3 were Poland, Estonia and Hungary, which secured 88, 25 and 22 rounds respectively. It was the first quarter when the Polish ecosystem became more and more active every day, which led to a much larger number of funding rounds secured there than in other CEE countries. Startups from Poland and Estonia also received the largest fundings: Polish/Finish Iceye - €73M in August, Polish Uncapped - €22M in August, and Estonian Veriff - €13.8M in July, while among other popular countries were Romania, Hungary, and Lithuania. 

Taking a look at sectors, in the third quarter funds were mainly invested into Artificial Intelligence, FinTech, Analytics, Advertising and Healthcare and the most active investors were Hiventures, Fil Rouge Capital and CB Investment Management.

Find out more in VC Funding In CEE Report  - 3Q 2020

Startup investment rounds in CEE in Q2 2020

> Number of funding rounds: 169
> The biggest disclosed investment round: Bolt - Convertible Note - €100M, Symmetrical - Seed - €5.6M, EstateGuru - Series A - €5M.
> Total value of funding closed  in CEE: over €160M*
> Countries with the majority of funding rounds: Poland - 58, Hungary - 30, Estonia - 17 rounds
> The most active VC funds: Hiventures, Fil Rouge Capital, CB Investment Management
> The most appreciated industries: Artificial Intelligence, E-commerce, Mobility, Real Estate, Analytics, Healthcare. 

*57 rounds undisclosed in terms of the transaction value

In the 2nd quarter of 2020, 169 investment rounds were closed in Central and Eastern Europe, while only 112 were fully disclosed in terms of company details, funding amount, date and participating investors. According to fully disclosed data, 37 funding rounds took place in April, 38 in May, and 37 in June. Investments remained similar and low throughout the whole quarter excluding one major Bolt round in February. This was connected to the fact that in Q2 governments introduced restrictions related to the COVID-19 epidemic. In April total VC funding reached over €25M, in May startups secured over €120M, and in June the money seen on the market was as little as €20M. The total value of investments in Q2 reached around €160M. 

The most active countries in terms of the majority of funding rounds in Q2 were Poland, Hungary and Estonia which secured 58, 30 and 17 rounds respectively. Despite the onset of the pandemic, Poland has once again demonstrated the strength of its startup ecosystem, but Hungary and Estonia were not very much behind either. The biggest funding rounds were secured by startups from Poland and Estonia. Estonian Bolt closed €100M, Polish Symmetrical - €5.6M and Estonian EstateGuru - €5M, while among other popular countries were Hungary, Czech Republic, Slovakia and Lithuania 

Taking a look at sectors, in the fourth quarter, funds were mainly invested into Artificial Intelligence, E-commerce, Mobility, Real Estate, Analytics and Healthcare and the most active investors in terms of the number of financing rounds were Hiventures, Fil Rouge Capital and CB Investment Management.

Startup investment rounds in CEE in Q1 2020

> Number of funding rounds: 165
> The biggest disclosed investment round: Rendi - Venture Series - €16.8M, Jasper Therapeutics - Series A - €11.8M, Envoy Group - Venture series - €10.9M.
> Total value of funding closed  in CEE: over €120M*
> Countries with the majority of funding rounds: Poland - 67, Estonia - 27, Hungary - 18
> The most active VC funds: Startup Wise Guys, Hiventures, Fil Rouge Capital.
> The most appreciated industries: Artificial Intelligence, Biotechnology, Financial Services, Analytics, E-commerce, Cyber Security.

*67 rounds undisclosed in terms of the transaction value

In the 1st quarter of 2020, 165 investment rounds were closed in Central and Eastern Europe, while only 98 were fully disclosed in terms of company details, funding amount, date and participating investors. According to fully disclosed data, 32 funding rounds took place in January, 30 in February, and 36 in March. It was the weakest quarter of the year, both in terms of the value of transactions and their quantity. While the first month of the year was not the worst, we ended the quarter with March, when startups secured just €15M in 36 fully disclosed rounds. The total value of investments reached over €120M. 

The most active countries in terms of the majority of funding rounds in Q2 were Poland, Estonia and Hungary which secured 67, 27 and 18 rounds respectively. While Poland recorded the biggest number of financial rounds, this time it did not lead in terms of rounds’ amount. The biggest funding rounds were secured by startups from Hungary, Latvia and Estonia. Hungarian Rendi closed €16.8M, Latvian Jasper Therapeutics - €5.6M, Estonian Envoy Group - €5M, while among other popular countries were Croatia, Hungary, and Lithuania. 

Taking a look at sectors, in the fourth quarter, funds were mainly invested into Artificial Intelligence, Biotechnology, Financial Services, Analytics, E-commerce and Cyber Security and the most active investors when it comes to financing rounds were Startup Wise Guys, Hiventures and Fil Rouge Capital.

Now, after already analysing VC transactions in 2020 and how they shaped the whole CEE market, if you are interested in further CEE startup & VC scene development we recommend you to take a look at the VC trends in 2021 forecasts. 

 

Wall Of Fame - TOP CEE Funding Rounds Closed In 2020!

The year 2020, despite the prevailing conditions, was very rich in the number of financial rounds and the quality of startups. We do appreciate all of them and here we decided to introduce the most interesting ones. That is why we would like to present a brief overview of selected CEE startups and their innovative solutions that succeed and got funded.

  • Bolt - Estonia-based, Bolt is a leading mobility platform providing ride-hailing, micromobility, and food delivery services. Since the beginning of its journey, Bolt has attracted more than 50M customers in over 40 countries setting the company’s value to over $1B. The company has recently secured €150M in the December Series D round and the proceeds will be spent on enhancing the safety and quality of the products and further expansion on European and African markets. Among the investors participating in the round are D1 Capital Partners and Darsana Capital Partners.
  • Brainly - Polish Brainly, founded in 2009, is an online learning platform where students can get help with their homework or any other queries. Brainly is opposed to the regular school curriculum by catering to the individual needs of every single student. The company operates in more than 35 countries and has reached over 200M unique users who got their over 50M questions answered every single month. The startup has recently secured €66M in a Series D round and the obtained financing will be allocated for the product development in India, Brazil and Indonesia. The funding round led by Learn Capital was accompanied by General Catalyst, Manta Ray Ventures, Prosus Ventures, and Runa Capital.
  • Booksy - Polish Booksy, founded in 2014, is an online platform for finding and booking beauty and wellness appointments. The company allows users to schedule appointments when it suits them and therefore increases the number and frequency of bookings. The startup has more than 13M active users among the US, UK, Polish, Spanish, Brazilian and South African markets and has recently secured €60M in Series C investment round led by Cat Rock Capital and accompanied by Sprints Capital, OpenOcean, Piton Capital, VNV Global, Enern Investments, Kai Hansen, Zach Coelius, and Manta Ray Ventures.
  • Iceye - Polish-Finish startup, founded in 2015, is a SpaceTech company empowering making better decisions in B2B and B2G sectors by building and maintaining a commercial constellation of radar imaging satellites to provide companies and organizations with reliable satellite imagery. The round was led by True Ventures, but another significant investor was OTB Ventures. Besides, the Series C round was also joined by Luxembourg Future Fund, Tesi, Draper Esprit, DNX Ventures, Draper Associates, Seraphim Space, Promus Ventures, Space Angels, New Space Capital and The European Investment Bank (EIB). Recently secured funds will be used to accelerate the growth of ICEYE’s satellite constellation.
  • Uncapped - Polish - British startup, founded in 2019, is a provider of revenue-based financing enabling founders to raise capital without interest or splitting equity. The latest investment round in the amount of €22M was led by Mouro Capital and was accompanied by Iron Ventures, Global Founders Capital, Seedcamp, White Star Capital and various business angels and secured funds will be allocated to expanding the Uncapped financing possibilities.
  • Veriff - The Tallinn-based startup helps businesses to prevent frauds by providing an end-to-end identity verification tool backed by AI. Veriff validates the user’s identity by combining the personal data analysis (ID card, passport, etc.) with biometric scanning (photo, video) as well as a number of other behavioral and technological information (e.g. device analytics, liveness check, PEP & sanctions inspection), which could confirm the identity of the user. Especially now, when businesses are moving online and more things can be done remotely, solutions like Veriff seem like a must-have. The July round of €13.8M was raised by Veriff in a form of a convertible note from the established VCs such as Nordic Ninja, Change Ventures and Y Combinator, Mosaic Ventures. The funds will be allocated to the international expansion of the product.
  • Symmetrical - Polish - British company, founded in 2019, partners with employers to give employees financial freedom, by enabling employees to instantly pay out a portion of their salary, ensuring liquidity and financial security. In April, the startup secured a Seed round in the amount of €5.6M which was led by Global Founders Capital and Partech and was accompanied by Market One Capital, Plug and Play, Finch Capital and Angel Invest. Funds will be used for further solution development.
  • EstateGuru - Estonia - based startup, founded in 2013, is a property marketplace offering short and mid-term property loans to bridge the gap between property and financing. The financing was a combination of UNIQUA Ventures investment and crowdfunding where more than 1000 people from 37 countries supported the company via a crowdfunding platform. Secured funds will be allocated to geographical expansion, supporting new technology and developing in the area of capital markets and institutional investments.
  • Rendi - Founded in 2014, Hungary based Rendi is an online platform for providing household services like cleaning, gardening, disinfection, construction waste removal, or even office moving. Startup has already gathered more than 20 000 customers and many partners which made it the biggest home cleaning platform in Hungary. Rendi has secured Series A round in the amount of  €16.8M from Hiventures and raised funds will be allocated for further platform development and expansion.
  • Jasper Therapeutics - Latvian Jasper Therapeutics, founded in 2020, is a biotechnology company with the goal of bringing curative hematopoietic cell transplantation to more people by making it safer and more effective. In January, the company expanded its Series A investment from 2019, by an additional €11.8M round led by Roche Venture Fund and secured funds were used to advance its clinical assets and technology.
  • Envoy Group - Estonian Envoy Group, founded in 2018, is a blockchain-based digital marketplace allowing both buyers and sellers to effectively manage international trade logistics processes. Venture round secured in February, in the amount of €10.9M was led by Alcedo Digital Ventures and will be allocated to expanding the company's services beyond Latin American markets.
  • Cosmose - Polish - Chinese company, developing an AI-driven platform for predicting and influencing the consumers’ shopping habits has recently secured a series A round in the amount of  €12.6M. The startup uses phone’s data to help customers understand the behaviors of over 1 billion smartphone users. Thanks to that, it is able to support companies with recovering from COVID-19 by predicting when the shop should be opened again or what products will be in demand in the nearest future. The investment round was led by Tiga Investments accompanied by TDJ Pitango Ventures and OTB Ventures. Secured funds will be used for further expansion and development of Cosmose’s solution.
  • Infermedica - Poland-based startup developing AI-driven platform that delivers rapid symptom triage and instructions to speed up patient healthcare has secured $10.25M in August Series A round. This patient-centric company develops smart technology which makes it easier to guide patients to the right medical care. Infermedica operating in a B2B model aims to increase the efficiency of insurance companies, telemedicine companies and healthcare systems through fast, digital symptom checks. Their tools have already been used by over 6 million users worldwide and their solutions have been appreciated by companies like Microsoft, Allianz Worldwide Partners and PZU Zdrowie. The latest round of funding will be allocated to increase their presence in the US and European markets as well as to further develop the technology. Among the Series A leading investors participating in the round are Karma Ventures, Inovo Venture Partners, European Bank for Reconstruction and Development and Heal Capital.
  • Skeleton Technologies - Estonia-based, Skeleton Technologies is a Cleantech company disrupting the world of energy storage by manufacturing ultracapacitor-based cells, modules, and other components. The startup’s goal is to help its customers reduce CO2, save energy and therefore save our planet. The company has recently secured €41.3M in the November Series D round and the proceeds will be spent on further technology development and expanding their product’s portfolio. Among the investors participating in the round are Adyen, FIRSTFLOOR Capital, Harju Elekter Group, MM Grup, and well-known for its dedication to sustainable development EIT InnoEnergy.
  • Silent Eight - Polish-Singaporean startup was founded in 2013 to help solving issues connected to financial crimes. Company’s technology is using Artificial Intelligence and Machine Learning to enable real-time transaction screening and therefore make compliance faster, more efficient and more accurate. The startup has recently secured €12.6M in the October Series B round and the proceeds will be spent on further solution development. The latest round was led by OTB Ventures, and was supported by SC Ventures and Koh Boon Hwee, chairman and general partner of Altara Ventures.

     

*If you have some insights or feedback regarding our report, drop me a line!


Moreover, we have also prepared a more detailed overview of TOP 100 CEE Startups that closed funding rounds in 2020. Get to know their interesting solutions closer in here.

Related Posts:

TOP 100 CEE Startups That Closed Funding Rounds In 2020 (by Konrad Koncerewicz, Community Builder, Vestbee)

VC Funding in CEE Report - 4Q 2020 (by Konrad Koncerewicz, Community Builder, Vestbee)

VC Funding in CEE Report - 3Q 2020 (by Konrad Koncerewicz, Community Builder, Vestbee)

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