News Article | October 8, 2014
Another exit for a Berlin tech company, albeit not necessarily a home run. Fyber, the adtech company formerly known as SponsorPay has been acquired by the publicly-listed European media company RNTS Media. Terms of the deal aren’t being disclosed, except to say that it’s a mixture of cash and stock, though we’re hearing from sources that the price is €150 million (which also tallies with the $190 million amount now being reported by VentureBeat, and an advisory issued by Anoa Capital). As a result of the acquisition — which can really be viewed as a merger of sorts, given the size of the respective companies — Fyber will become a subsidiary of RNTS Media and will continue to operate independently under its existing leadership team. Fyber co-founder and CEO Andreas Bodczek will become Managing Director and CEO of the RNTS Media Management Board, and Janis Zech, co-founder and CRO of Fyber, will also join the Management Board. Originally called SponsorPay, the Berlin startup was co-founded by Team Europe, the German-styled company builder, back in 2009 to help free-to-play browser based games find a route to monetisation. However, following wider games industry trends, in 2011 it pivoted to focus entirely on mobile with a unified supply-side-platform to let mobile app developers manage all of their mobile ad revenue, serving approximately 150 million unique users per month. Fyber claims thousands of customers, name-checking Gree, Glu Mobile, Kongregate, and Pixelberry. Our understanding is that Fyber had raised around €10 million in equity-based financing, plus some debt-financing, over the course of two or three rounds. Backers included Team Europe Ventures, Hasso Plattner Ventures, Kite Ventures, and Nokia Growth Partners, an independent venture fund sponsored by Nokia.
News Article | January 13, 2014
In the first big European funding news of the year, Berlin-based food-ordering service Delivery Hero said on Monday that it has raised $88 million. The Insight Venture Partners-led Series E round – one of the largest ever in the German startup scene – brings Delivery Hero‘s overall funding to almost $200 million, and should help it in its ongoing battle with London-based rival Just Eat, which has more than 40,000 restaurants signed up across 13 countries. Team Europe portfolio company Delivery Hero has 55,000 restaurants across 14 countries.
News Article | September 11, 2014
On the heels of Rocket Internet’s food delivery service FoodPanda taking another $60 million in funding, its German rival Delivery Hero is also stepping up its game in a consolidation play. The company today is announcing that it has acquired Pizza.de, another longstanding competitor also based in Germany. The financial terms of the deal were not disclosed but we understand from a source that it is an all-cash deal, with no shares exchanged and that post-acquisition, the total valuation of Delivery Hero is now over $1 billion. Update: A VC advisory group based in Berlin, Cooperativa.vc, noted in a Tweet that the acquisition is actually worth €400 million ($535 million), which it has contacted us to note they made a typo and it is actually $400 million. A German publication, Express.de, notes a price in a similar range: €290 million, or $387 million. Delivery Hero would not confirm the price when asked again. Östberg calls the acquisition of Pizza.de “the largest news in the history of Delivery Hero,” and you can see why. While Delivery Hero has raised $306.7 million since opening for business in 2010 — including over $170 million this year alone — Pizza.de gives Delivery Hero a big boost in scale in its core market. And in the world of e-commerce and logistics-based services, certainly time is of the essence, but scale is, too. As a point of comparison on valuation, UK-based Just-Eat, another European competitor in the space that went public earlier this year, is currently valued at $2.45 billion (£1.47 billion). U.S.-based Grubhub, meanwhile, is valued at $3.56 billion. Delivery Hero, like FoodPanda, remains in private hands, but that may change in the next year, or it may not: “We still aim to be IPO ready in the course of next year,” Östberg tells me, “with IPO as an option to choose from.” While we don’t know FoodPanda’s numbers, it has the mighty power of Rocket Internet behind it. In Berlin’s so-called “startup factory”, the Samwer brothers, founders of Rocket Internet, have built up a global empire of e-commerce businesses (scale again!), and is inching into an IPO with a valuation of around $4.4 billion. Beyond these existing food delivery players, there is the prospect of yet more entrants. Amazon, we have heard from reliable sources, is among those interested in the space, to dovetail with their other efforts to push into local commerce (our source even cited Delivery Hero among those that were a point of comparison for the Seattle giant). And Square recently acquired Caviar. The fact that these companies are larger than Delivery Hero both in terms of valuation and organization does not seem to deter the company for now. “Generally we feel quite comfortable since we have investors backing our company that have billions of dollars at their disposal,” Östberg says. Delivery Hero’s investors include Insight Venture Partners, Luxor Capital Group, Kite Ventures, Team Europe, ru-Net, Tengelmann Ventures, Point Nine Capital and Phenomen Ventures. “Due to our focus on delivering the best takeaway, we feel confident that we will always be able to provide a better service than general e-commerce companies. For that reason not worried as long as we continue to stay innovative.” Today Delivery Hero’s food ordering services cover some 75,000 restaurants across 23 countries, with half of its 800 staff based in Berlin. Delivery Hero’s German brand, Lieferheld, and Pizza.de will continue to operate as separate brands, the company says. Part of the reason is demographics: Pizza.de is popular with students in particular, who like to track their deliveries in real-time as a way of procrastinating from doing their work; no need to mess with a good formula. “Customers of both German brands will benefit from improved services driven by the collective expertise and innovative capacity of both companies,” the company says in a statement. “Restaurants that cooperate with both brands can now be serviced by a single point of contact.” With Germany sewn up, this will also give the company the ability to focus more on Asia and Latin America. There is a bit of backstory worth noting here, too. Pizza.de actually went after Lieferheld in the courts alleging that the latter company had stolen database information from Pizza.de. The claim was that Lieferheld, starting in the business later than Pizza.de, had lifted menu and account names from Pizza.de to build up its business. The two knocked heads, and apparently settled, in two different court cases.
News Article | March 24, 2014
Angel investors, that is: Point Nine general partners Christoph Janz and Pawel Chudzinski are bringing their early stage, SaaS-centric startups to San Francisco in order to be closer to the action. The duo launched Point Nine in Berlin in 2009 because Janz saw firsthand how difficult it was for European startups to raise early stage capital. European investors are loathe to pony up seed rounds in excess of $1 million, Janz said, preferring instead to open wallets usually to the tune of $200,000 to $300,000. Hardly enough for even the best startups to get their legs. In the States, seed rounds — especially lately — often exceed $1 million. But not in Europe. “Angel investors are much scarcer in Berlin and Europe than they are here. There, it’s much harder for startups to raise funding, and its harder there to raise capital at any stage,” Janz said during a recent sit down with VentureBeat. The quiet-spoken, spectacle-wearing Janz, a successful entrepreneur and startup founder who got his chops honed in his teens trading Commodore 64’s to friends and likeminded clients, founded Dealpilot, a comparison shopping website, in 1997. He made serious money when he sold a large percentage of the startup to German media giant Bertelsmann in 1999 for around $30 million. After he started and sold Pageflakes in 2008 — it was a platform that allowed customers to build home pages with custom dashboards, RSS feeds and weather widgets — Janz was wondering what to do with his life. Then he stumbled upon a Danish firm called Zendesk, a leading cloud software play specializing in customer service operations. He became an angel investor. Point Nine has two early stage funds focused on the consumer side of startups. Fund 1 is about $10 million, while Fund 2 is nearly $60 million. The firm has seven employees, and managing partner Pawel Chudzinski said Point Nine was spun out of Team Europe, a Berlin-based incubator and funding operator. The average Point Nine investment is about a $1 million. So far, Point Nine has managed to get almost all of its portfolio companies to open up offices in San Francisco and the Valley, with the exception of Clio, a Canadian SaaS software platform focused on law firms. Cleo is staying up in the Great White North — for the time being anyway. The list of Valley-bound Point Nine companies includes Denmark’s Zendesk, now situated in San Francisco; Algolia, a Paris enterprise software play targeting developers, which is in the process of moving to the Valley; ShiftPlanning, a Panamanian business management software startup, also en route to San Francisco; and Vend, a New Zealand POS software company with personnel now working in San Francisco. A major lure for Point Nine is what the duo said was access to the best salespeople on the planet: Americans. While Europe has some of the best engineers working in tech, the Europeans lack what the two said was a killer instinct to sell, and sell successfully. “When European partners want to scale up sales, its very hard to find them in Europe. We feel Americans tend to be the best salesman,” Chudzinski, who was born in Western Poland, said.
News Article | September 1, 2014
Whenever startup ecosystem commentators discuss how to create European technology businesses of global scale they tend to name one company as a shining example: Skype. Headquartered in Luxembourg and developed in Estonia, Skype is a revolutionary product and, rightly, a European success story. It sold three times in the last seven years; most recently, to Microsoft for $8.5 billion. But there is a Dutch company whose revenue is greater than Skype’s, a company that is seldom talked about, but which offers another template for European entrepreneurs to emulate. Its name is Booking.com and, listing 456,000 hotels and other accommodation in over 190 countries, it is massive. The Booking.com you see today is the product of two predecesssors: Active Hotels, founded in Cambridge, UK, in 1998; and its peer, the original Booking.com, founded in The Netherlands in 1996. These two companies got acquired by the U.S. giant Priceline, in 2004 and 2005, respectively. Priceline’s Netherlands office, which houses the combined Booking.com unit, did $4.1 billion in revenue last year. That’s 60 per cent of the group’s total and likely four times greater than Skype is reckoned to be pulling under Microsoft. “It would be tough to argue that there’s been a better acquisition in Internet history,” according to some. Put that way, it is easy to wonder if Booking.com shouldn’t have remained independent and become Europe’s leading standalone Internet company. When a U.S. company builds a marketplace site, one which connects buyers and sellers, it typically focuses on North America alone (AirBnB being one of the very few exceptions). But when startups in our fragmented and diverse continent build an online marketplace, they have to acquire merchants, customers, users and market share in multiple European countries to get really big. As a result, it has historically been hard to impossible for large U.S. marketplace companies to expand internationally in any way other than through acquisitions. The best example to illustrate this is eBay, the non-U.S. success of which seems to be entirely based on acquired companies. Marketplaces of European origins are much more comfortable in going international, country by country. That isn’t easy, cheap, or quick. It was a decade after its start that Booking.com had its exit. Building a European marketplace takes shoe leather — real, on-the-ground presence in multiple countries, gaining trust and growing relationships. Take Just-Eat or, in our investment portfolio, its counterpart Delivery Hero: You can’t build such a takeaway ordering service without employing dozens or hundreds of sales reps to go into restaurants in each country. But the rewards can be great. Once a business has acquired a sufficient listings and customer base, once it has become the go-to brand, it is supremely defensible, and it is hard for any rivals to unseat it. This is enviable: An inter-European marketplace with top brand positions across the continent will always be an acquisition target or a strong IPO candidate in its own right. There are a number of still-underdeveloped areas open for upcoming European online marketplaces to dominate. My favorite examples are healthcare and beauty, which are highly recurring and very mainstream services representing huge markets of tens of billions of Euros of spend yearly. At Point Nine Capital, we have invested in companies such as Docplanner, an international platform for booking medical appointments, or StyleSeat, a (U.S.-based) platform for booking beauty appointments. But there is much more to come: household cleaning services, handymen, car repair … lots of the services we use every day can make for a great marketplace opportunity. As I pointed out in a recent blog post, I think that there are two types of startups: global and local/multi-local. It is very important for founders to understand which category their company is in, as it will have significant consequences for how they internationalize. Skype will always be a great template for founders, but it’s just one template: one of a global brand and end-user product. I would encourage European entrepreneurs to pursue the Booking.com playbook and creating scalable, multi-local marketplaces in large markets. And if you’re one of those startups, I’d love to hear about you. Before co-founding Point Nine Capital in 2011, Pawel Chudzinski was a co-founder and partner at Team Europe where he led investment activities. Prior to that, Pawel worked as an associate for the U.S. investment banking firm Greenhill & Co. in Frankfurt and London. You can read his thoughts on the European investment scene on his blog.
News Article | January 13, 2014
Delivery Hero, a Berlin, Germany-based global provider of online and mobile food ordering technology for restaurants and consumers, raised $88m in Series E financing. The round, which brought the total amount raised by Delivery Hero close to $200m, was led by Insight Venture Partners. The company intends to use the funds to expand its position in its existing markets. Delivery Hero provides online and mobile ordering capability for more than 55,000 restaurants in 14 countries including Germany, Sweden, UK, Korea, China and India. Led by Niklas Östberg, CEO, Delivery Hero is a worldwide network of online food ordering sites with over 55,000 restaurants connected to its service. The company operates in Germany, UK, Sweden, Finland, Poland, Austria, Denmark, Russia, Australia, Switzerland, South Korea, China, Mexico and India. It has more than 700 employees around the world with 300 staff working from its Berlin headquarters and is continuing to hire. Investors include Insight Venture Partners, Kite Ventures, Team Europe, ru-Net, Tengelmann Ventures, Holtzbrinck Ventures, Point Nine Capital and Phenomen Ventures.
News Article | March 11, 2015
Rocket Internet, the publicly-listed German ‘startup factory’ and e-commerce behemoth, has once again increased its stake in Delivery Hero, the online take-out delivery service that competes with its own Foodpanda, along with recently IPOed Just Eat. Rocket Internet is also announcing an increased investment and (now majority) stake in Foodpanda itself, with both moves part of a strategy to build out its Global Online Takeaway Group, a roll up of all its food delivery companies. What the e-commerce giant plans to do with Global Online Takeaway Group, however, it isn’t saying. Off the back of Just Eat’s IPO, might the plan to be to float Global Online Takeaway Group publicly in its own right? That seems a more obvious exit than being acquired, given that there aren’t many companies that could afford to buy a company the size of the one Rocket Internet is rapidly building. “We generally do not comment on any rumours,” a Rocket Internet spokesperson told me when asked about that possibility. As helpful as ever, Rocket Internet later told TechCrunch that “the strategy is to seize market opportunities and to continue building the largest and the only truly global online takeaway marketplace in the world by organic growth and selective investments.” Specifically, Rocket Internet has increased its stake in Delivery Hero to circa 39 per cent. This comes via the contribution of Middle Eastern online food takeaway company Talabat and the acquisition of (secondary) shares from existing Delivery Hero investors for a price of €52 million. Of note, it was only last month that Rocket Internet increased its stake in Delivery Hero to 30 percent, at a cost of €496 million. Therefore, it’s not inconceivable that the company might be on a trajectory to majority ownership of its former rival. “Delivery Hero with its 24 countries and 62.6 million annualized orders (based on December 2014) is a key component of the Global Online Takeaway Group, complementing foodpanda and the two recent investments in La Nevera Roja (Spain) and Pizzabo (Italy),” said Rocket Internet in a statement. Investors in Delivery Hero include Insight Venture Partners, Kite Ventures, Team Europe, ru-Net, Tengelmann Ventures, Point Nine Capital, Phenomen Ventures and Vostok Nafta. Furthermore, Rocket Internet is announcing that Foodpanda has raised a new €104 million funding round from new and existing investors. Rocket itself is investing an additional €37 million in the online take-out delivery company, and is purchasing shares from existing shareholders and shares formerly held through Latam Internet Group through via a share dividend. In other words, a mixture of primary and secondary investment. Regardless of the mechanism, however, it increases Rocket Internet’s direct stake in Foodpanda to a controlling interest of around 52 per cent, up from 50. Lastly, Rocket Internet says it intends to contribute its 11.4 per cent stake in Yemeksepeti, the online takeaway market leader in Turkey, to the Global Online Takeaway Group. Yemeksepeti is present in 63 cities in Turkey and works with nearly 10,000 restaurants. To sum: Rocket Internet’s Global Online Takeaway Group just got a lot fatter.
News Article | June 20, 2015
News Article | June 20, 2015
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News Article | June 7, 2015
Delivery Hero, the takeout food ordering service based out of Berlin, has raised yet more money — possibly some of its last before an IPO sometime after 2015. It’s picked up another $110 million from two unnamed “leading public market investors” out of the U.S., at a post-money valuation that the company says is over $3.1 billion. This latest $110 million brings the total raised in primary equity by Delivery Hero to $1 billion, with nearly $600 million of that raised this year alone. Investors in previous rounds include Insight Venture Partners, General Atlantic, and Rocket Internet (the sole investor behind the $586 million raised so far this year; Rocket also took a $58 million secondary investment), as well as several US-based public fund managers. In an interview by email, Delivery Hero CEO Niklas Östberg would not disclose the names of the investors in this latest round, nor would he give a timeline for when it plans to list publicly. He believes the company will be in a position to list this year — it’s now clocked up 200,000 restaurants across 34 countries, processing 10 million orders each month and generating $165 million in monthly sales for its network of restaurants. But, for now staying private plays to Delivery Hero’s advantage against publicly listed competitors, such as Just-Eat, as it can move faster with acquisitions and other strategic moves as a private company. “We will not be able to share investors and also not when we will IPO. Our view is that we will be prepared later this year but will wait until we see a clear benefit from it,” he told TechCrunch. “Right now we enjoy the benefits of being private. We have the same financial backing as our public peers while being able to act very long term. This makes us the worst possible competitor you can have. Therefore no plans to IPO in 2015.” On the subject of raising more money in the meantime, he remains vague. “I actually don’t know if we will raise before [our IPO,]” he says. “We will only take on capital if we see a need for it.” The company is being somewhat less quiet about how it intends to use this latest $110 million: “selective acquisitions and intensive product innovation,” it notes in a statement. The could mean a couple of different things: Up to now, Delivery Hero has followed the well-trod path of other e-commerce companies, making acquisitions to help the company move into new geographic markets. Some of the most recent include last month’s Yemeksepeti in Turkey for $589 million, a record price for a food ordering acquisition; and Pizza.de, acquired in August 2014 at an undisclosed price that valued Delivery Hero at $1 billion. Today, Delivery Hero is active in 34 markets, so there is still room to grow. That could mean more regional consolidation plays to come. (One market where DH is noticeably absent, for example, is the U.S. where Seamless/Grubhub has been one of the bigger names in the market but others like Yelp and Amazon are also looking to do more.) However, the other area where we may see investment is in acquisitions that help Delivery Hero expand not just into countries but into new product areas. This is something that Östberg himself suggests, too, going beyond online takeout and delivery and into other food categories. “We are a product leader today but plan to make a step change by the end of the year,” he says. “We will stay focused on food.” As a category, however, food is a moveable feast, so to speak: it could mean a move into “meal kits” such as those sold by Blue Apron and others; or grocery delivery; or high-end restaurant delivery. In addition to Insight, General Atlantic and Rocket Internet, other investors include Kite Ventures, Vostok Nafta, Team Europe, ru-Net, Tengelmann Ventures and Point Nine Capital.