“This is a 20 year project” according to Seedcamp founder and chairman Saul Klein, who also just happens to be a partner in the Index Ventures VC firm. It’s five years on since Seedcamp’s launch in 2007 and Klein is as bullish and upbeat about Europe’s oldest ‘new model’ accelerator, which has been compared favourably to the likes of Y Combinator and TechStars in the US. But 5 years on where are they… now?
After five years and 200 startups, Seedcamp may be the oldest and — arguably — the biggest tech startup accelerator in Europe, but it’s quite different to other global accelerators you might have heard of. On its 5th birthday it’s released a bunch of stats around what it’s done so far. We’ll run through those but also give you a heads-up on why Seedcamp is perhaps shaping up to be the ‘anti-Y Combinator’. Not that these guys hate Paul Graham, far from it. But more that, while YC famously refuses to leave the Valley (and even shut down its Boston operation a while back), Seedcamp continues to race around Europe, is pushing out into hot developing markets, and is working with multiple partners globally. In the world of accelerators, if YC was Apple, Seedcamp would be Android (and, btw, it has a map that works outside North America…).
First the heads up. Seedcamp launched in the year Facebook opened beyond universities and Twitter debuted at SXSW. These days it shells out €50,000 per startups team (which usually attract other co-investors), puts them through a year of showcasing around Europe (and the Valley for 4 weeks) and takes around 8-10% equity. Invested teams also get a €150,000 “founders pack” of offers from the likes of 10gen, Softlayer and Yammer.
From the early days they zoomed around Western and Central/Eastern Europe taking in Croatia, Estonia, and Slovenia among others. From there they’ve gone as far as Mumbai in search of local startups underserved by risk-adverse local investors.
But what about results?
They’ve mentored nearly 200 startups from 35 countries (from over 2,000 applications across 70 different countries). According to Reshma Sohoni, co-CEO of Seedcamp, the organisation’s €5 million fund still has runway enough until “Q4 next year”. But there have been some results in the last 5 years.
A 2008 Seedcamp company Mobclix was bought by Velti in 2010 for $50m.
Crashpadder (an Airbnb clone) was bought this year by Airbnb for an undisclosed amount.
And RentmineOnline, a 2007 vintage company, was acquired in July this year by RealPage. Although the terms were undisclosed and Seedcamp is tight-lipped about the price, the rumour is it was sold for around $14 million, enough to boost Seedcamps fund, alongside RentmineOnline’s other investors, obviously.
Some investments that stand out to date include Brainient, Erply and Ubervu – all growing well. Indeed, PayPal has partnered with Erply enabling offline payments. Erply is working with the likes of Saks 5th Avenue and Elizabeth Arden for instance.
What’s the downside? Nine of the 200 startups that have passed through Seedcamp’s system in the last 5 years have simply died or withered away. Out of 200 that’s a pretty good hit rate.
Its been hard work for the small team of four – which also includes co-CEO Carlos Eduardo Espinal – and arguably Seedcamp punches above its weight. To suck up this many companies a VC or Private Equity house would have to employ an army of investors.
So to scale, Seedcamp has built a global network of 2,000 mentors in a variety of global tech hubs such as Barcelona, Berlin, London, New York, Paris, Prague, Tallinn, Tel Aviv and Zagreb. 500 of them are classed as ‘top-ranked.’ They also bring in corporate relationships with Amazon, Facebook, Google, Microsoft, PayPal and Qualcomm in tech and AXA, Barclaycard, HSBC, Nielsen, NHS, RBS, Unilever, and Vodafone. And Yandex became an investor this year. They are also working with other accelerators such as Eastonia-based Garage48, and 500 Startups in the Valley and now GSF in India. Indeed, 500 startups has invested in nine Seedcamp companies.
Based out of Google Campus in London, in the heart of the ‘TechCity’ area Seedcamp is also a lobbyer of the UK government, and was amongst those arguing for the Founders Visa and a new 50% tax relief for angel investors in startups (the EIS scheme). Its also runs one of the first pan-European summit events for Angel investors, known as SeedSummit.
Some more stats for you: Since 2007 they have invested in 73 companies in 25 countries creating over 800 new jobs. Some 75% of those companies raised follow-on funding of more than $70m. So far in 2012 Seedcamp has made 18 new investments from 12 countries. This year they made their first investments in Hungary, Latvia, Malta, Switzerland and Ukraine and return investments in Belgium, Estonia, Finland, France, Israel, Spain and UK. And over 50% of Seedcamp’s 2012 class has raised further capital before Demo Day from investors like Betaworks, Lerer, 500 Startups, Index, SV Angel, Tony Hsieh and some of the 2011 class raised money from Atlas, IA Ventures, Max Levchin, Errol Damelin, David Yu and Sherry Coutu.
And Seedcamp’s “SeedHack” hackathons have led to the creation of a simple template agreement for founders of a product that emerges form a hack.
Ultimately, argues Klein, Seedcamp is not about the YC mode of being Silicon Valley Centric. “It’s about style versus substance. And we roam globally because if the mountain doesn’t come to you, you have to go to the mountain. The likes of Summit Partners, KKR or Silverlake could never cover this much territory. This is an unprecedented model.”
He thinks the ‘YC model’ is still too focused on the Valley.
Sohoni concurs: “We really believe in international global startups. Our partners are our beachheads to many other places… From accelerators to VCs, the entire ecosystem is under pressure to deliver. The industry is changing.”
But after 5 years of building up, the next five years are probably going to be the most crucial for Seedcamp, as its invested companies mature and the capital markets emerge from the global slowdown.
There are plenty more mountains to climb — but what a beginning.
Photo credit: @4nkush