Impact & Innovation platform launch report ImpactFest October 2020 / 2 The new home of Impact & Innovation. Visit the platform » impact.dealroom.co / 3 ImpactCity is the startup and scale-up community of The Hague. We help innovative entrepreneurs to start successfully and to grow their business. We are a modern bank for people and businesses across the Nordics with deep financial competence and leading innovative solutions. Tech Nation fuels the growth of game-changing founders, leaders and scaling companies so they can positively transform societies and economies. Dealroom.co is the foremost data provider on startup, early-stage and growth company ecosystems in Europe and around the globe. Knowledge partners Initiators Exponential View Planet+ / 4 Data curation for deeper insights. Dealroom’s has an in-house Intelligence Unit to curate the data, and create collections and interactive landscapes for users. Users can also create their own collections and organise them into landscapes. Market landscapes Sustainable tourism Water technology AI for good Impact startups landscape European energy landscape Collections Impact investing platforms European impact VCs Carbon capture & storage Hydrogen companies Food waste startups / 5 Venture capital investment into European impact startups 2015 2016 2017 2018 2019 2020E €1.5B €1.7B €2.1B €3.3B €6.0B €5.0B Low-cost batteries for EV Affordable & Clean Energy #7 $600M Growth equity Sep 2020 B2C sustainable energy supplier Affordable & Clean Energy #7 £300M Late VC Apr 2020 E-powered flying taxi (mobility) Climate Action #13 $240M Series C Mar 2020 Sustainability ratings software Climate Action #13 $200M Growth Equity Jan 2020 Oat based milk Climate Action #13 $200M Late VC Jul 2020 Telemedicine Good Health and Well-being #3 €140M Series C Jan 2020 Refurbished electronics marketplace Responsible Consumption and Production #12 €110M Series C May 2020 Electric buses and vans Climate Action #13 $118M Growth Equity Oct 2020 In 2019 and 2020, over €11B+ has been invested into European impact startups, including megarounds for several high-profile startups. Biggest European impact rounds, 2020 / 6 VC INVESTMENT 2015-2020 ▉ Europe ▉ Global 2015 2016 2017 2018 2019 2020E €5.8B €6.2B €9.5B €16B €17B €19B €1.5B €1.7B €2.1B €3.3B €6.0B €5.1B Electric adventure truck Climate Action #13 $2.5B Growth equity Jul 2020 EV automaker Climate Action #13 $1.5B Series D Sep 2020 Clean energy infrastructure Affordable and Clean Energy #7 $1.0B Growth Equity Feb 2020 Electric passenger aircraft Climate Action #13 $590M Series C Jan 2020 (Lixiang) EV automaker Climate Action #13 $550M Late VC Jun 2020 EV automaker Climate Action #13 $500M Series C Jul 2020 Plant-based food Climate Action #13 $500M Series F Mar 2020 Distributed microgrid platform Affordable and Clean Energy #7 $300M Growth Equity Feb 2020 Global impact startups & scaleups are on track to raise record levels of investment in 2020. Venture capital investment into impact startups Biggest non-European impact rounds, 2020 / 7 2010 2015 2020 Impact investing accounts for over 15% of total European VC investment, 3x more than in 2010. Global Europe Impact investing as percentage of total VC European startups are more impact-focussed than their global peers. €6B was invested into European impact startups in 2019, making up over 15% of all VC investment in the region. This research shows that what was once fringe investment and innovation activity is finding traction and proven success in Europe, becoming a core part of European tech ecosystems. At 15%, European impact investment now makes up 3x the proportion of total VC investment compared to a decade ago, and double the global average of 7%. US Asia / 8 SDGs #1 - #6: A wide range of startups are addressing the UN Sustainable Development Goal challenges, some have already achieved brand name status. Gender Equality (#5) Achieve gender equality and empower all women and girls No Poverty (#1) End poverty in all its forms everywhere1 Quality Education (#4) Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all Zero Hunger (#2) End hunger, achieve food security, and improved nutrition and promote sustainable agriculture Clean Water and Sanitation (#6) Ensure availability and sustainable management of water and sanitation for all Good Health and Well-being (#3) Record symptoms and side effects, and medication adherence Faster intervention in case of an emergency 1) Sustainable Development Goals descriptions have been taken from: https://sdgs.un.org/goals / 9 SDGs #7 - #12: Startups producing and distributing clean energy are the most valuable impact companies, but rising stars appear in every challenge area. Sustainable Cities and communities (#11) Make cities and human settlements inclusive, safe, resilient and sustainable Affordable and Clean Energy(#7) Ensure access to affordable, reliable, sustainable and modern energy for all1 Reduced inequalities (#10) Reduce inequality within and among countries Decent work and economic growth (#8) Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all Responsible consumption and production (#12) Ensure sustainable consumption and production patterns Industry, Innovation and Infrastructure (#9) Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation 1) Sustainable Development Goals descriptions have been taken from: https://sdgs.un.org/goals / 10 SDGs #13 - #17: Big and small startups are working towards achieving carbon neutrality and protecting the terrestrial and marine ecosystem. Partnerships (#17) Strengthen the means of implementation and revitalize the global partnership for sustainable development Climate Action (#13) Take urgent action to combat climate change and its impacts1 Peace, justice and strong institutions (#16) Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions Life below Water (#14) Conserve and sustainably use the oceans, seas and marine resources for sustainable development Life on Land (#15) Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification, and halt and reverse land degradation and halt biodiversity loss 1) Sustainable Development Goals descriptions have been taken from: https://sdgs.un.org/goals / 11 Planet 57% Prosperity 31% Prosperity 12% Other 0.2% Climate Action and Clean Energy are the SDGs that have attracted the highest amount of VC investment since 2015. / 12 HQ Rounds Selected co-investors Paris 31 High-Tech Gründerfonds, Talis Capital, Kima Ventures London 29 General Catalyst Partners, Bessemer Venture Partners, Entrepreneur First, Seedcamp London 15 Beringea, Speedinvest, 500 Startups Vilnius 14 Practica Capital, Maniv Mobility, Gagarin Capital Partners London 14 Partech, Draper Esprit, Global Founders Capital Berlin 14 HV Holtzbrinck Ventures, Union Square Ventures, Andreessen Horowitz Stockholm 12 Northzone, EQT Ventures, Almi Invest Amsterdam 12 Endeavor Capital, Global Innovation Fund, Liil Ventures Most active European impact funds, last 24 months Visit the platform What is an Impact VC? Here, Impact VCs have been selected through a mix of criteria that include: the self-reported mission statement of the investor; an investor having a dedicated fund for impact or diversity; the investor having a specific focus on under-represented founders. However, as impact investments now make up a significant proportion of all investments, the line between impact and non-impact VCs is blurring. Impact VCs now frequently co-invest with established VC funds, making more capital and expertise available to impact startups than ever before. The Impact & Innovation platform’s matching tool pairs startups with relevant investors based on funding and sector criteria to foster connections and fuel growth. At least 60 European Impact VC funds find co-investors in established VCs. / 13 Climate pledge fund Climate & nature fund Climate innovation fund Sustainable packaging fund Impact fund Sony innovation fund: environment Impact fund II Big brands are bringing major fire power in the form of corporate impact funds along with their carbon neutral commitments. / 14 2017 New York, US $32M, 2020 Visit the platform Plant-based, insect and lab-grown - understanding the alternative protein landscape. / 15 The job board for the global impact ecosystem. We know that 2020 has been a challenging year for many workers, but as an important job growth engine, many startups are still hiring. In Q3 we quietly started rolling out a new job board. The job board aggregates data from different websites via APIs, and combines it with the power of Dealroom data. This enables users to make very detailed curated searches. You could search for all jobs at impact femtech startups, or UK-based impact companies that have raised Series A, and see the company’s growth trajectory directly in the listing. For version 1 which is live today, we’ve incorporated data from Indeed, Welcome to the Jungle and TheHub.io. In Q4 and 2021 we’ll be added even more sources and listings. Search impact job openings by startup sub-sector, funding round or growth stage. Visit the platform / 16 2015 Aix-en-Provence, France €1.4M, 2020 Liquid hydrogen transportation technology. Green hydrogen (created by electrolysis using renewables) can offer a sustainable option for some of the hardest parts of the transition to net-zero - including shipping, heavy industry, and long-distance freight. The European Commission’s new hydrogen strategy from the European Green Deal forecasts hydrogen to satisfy 24% of energy demand by 2050 (currently at less than 1%). Visit the platform Green hydrogen - the unsung hero in pursuit of Net Zero. / 17 Explore impact themes and customizable data visualization tools. Visit the platform / 18 M&A activity is hotting up in the mid-market impact space. Clean Energy Health & Wellbeing Mobility Honda Ubitricity Bird Circ Addison Lee Climatecars Ola Electric Etergo Zur Rose TeleClinic Roche mySugr ASSA ABLOY FocusCura Bloom ivary Diagnostics innogy Greenergetic 4NG 4energy Galiena CAMEO Gilde Equity EVBox Food & Agriculture Job Security & Recruitment Gimv Impact.be Mentha Capital Aethon.nl hokify karriere.at RIG Cpl Solutions Healthcare Planet Inverleith Organic Glanbia Nutramino Avallon Organic DeA Capital Abaco Education Smart Pearson Sparrow Recruit Quipper WeWant Kahoot! ToKnow Chegg MATH 42 / 19 Our mission: accelerate purpose-driven entrepreneurship and innovation through better data. Brilliant data has the power to accelerate entrepreneurship and innovation. It does so by inspiring people and enabling better decision-making - decisions about capital allocation and policy design. Data transparency can facilitate equal access to opportunity and better accountability. Building an engaged community of founders, VCs, researchers and policy makers. Enthusiasts can get inspired and find jobs. Startup teams can find investors and recruit. Investors can discover impact startups & innovations. Anyone can use this platform as a trusted source of data on key players, investments, trends, etc. impact.dealroom.co DISCOVER IMPACT STARTUPS Comprehensive database of impact startups & scaleups IDENTIFY TRENDS Impact investment strategies SEE THE BIGGER PICTURE Uncover data-driven insights HELPING FOUNDERS Free tools, including matching investors with startups / 20 Impact methodology. What is an impact startup? For the Impact & Innovation database, we consider an impact startup to be a company that is addressing one or more of the UN Sustainable Development Goals (SDGs)[1]. So far we have manually classified over 5,000 startups using this framework. How do you label impact startups? We employed a set of keywords to filter Dealroom’s startups for affinity with the SDGs[2]. We then reviewed startups’ publicly disclosed information, such as business model, mission statement, and case studies to assess their SDGs focus. Companies addressing more than one SDG are counted against each individual SDG they are targeting. Are climate tech and clean tech startups part of your taxonomy? We share PwC’s definition of climate tech as “a broad set of sectors which tackle the challenge of decarbonizing the global economy”[3]. As a result, climate tech companies are labelled with SDG 13 and others according to their sector-focus. On the other hand, we understand clean tech as a synonymous of clean energy startups. How do you tackle greenwashing? We are aware of the constraints of the above mentioned approach. In fact, there are clear limitations on the quantity and quality of publicly available information of often small and private companies. Therefore, this impact categorization is an ongoing process and a company’s taxonomy might be subject to change. What do Core and Side mean? Additionally, we differentiate between impact startups that have impact at the ‘core’ of their business model and the ones that have it as a ‘side’ or peripheral focus[4]. The aim of this distinction is to make easier for the user to identify and distinguish between companies that are purely mission-driven e.g. The Ocean Cleanup and others, like Tier Mobility, that create positive externalities in an indirect way. Core-focused companies are not necessarily creating more impact compared to side-focus companies. This would depend on a variety of factors, such as their market sizes and reach. Is impact the same as tech for good, social impact and purpose-driven tech? Purpose-driven startups, responsible tech, social impact, tech for good are other terms[5] that are also used to describe the space where a company is aiming to create a positive impact beyond just financial returns. What about Environmental Social Governance (ESG) criteria? Environmental Social Governance (ESG) criteria are a set of non-financial standards used to evaluate companies according to metrics like CO2 emissions, employee relations, and conflicts of interest.[6] Impact startups go a step further compared to ESG companies, not only they do not operate in industries like tobacco, weapons but they try to create a positive impact on the planet and its people. [1] https://www.un.org/sustainabledevelopment/sustainable-development-goals/ [2] All the keywords are listed in the appendix. [3] See p6, https://www.pwc.com/gx/en/services/sustainability/assets/pwc-the-state-of-climate-tech-2020.pdf [4] A similar approach was employed in the 2019 State of European Tech [5] For example, see https://www.slush.org/entrepreneurship-redefined/purpose-driven-change/ [6] For a more comprehensive overview see: https://www.investopedia.com/financial-advisor/esg-sri-impact-investing-explaining-difference-clients/ / 21 Venture capital investment Investment numbers refer to rounds such as seed, series A, B, C, …. late stage, and growth equity rounds. Venture capital investment figures exclude debt or other non-equity funding, lending capital, grants and ICOs. Buyouts, M&A, secondary rounds, and IPOs are treated as exits: excluded from funding data. Investment rounds are sourced from public disclosures including press releases, news, filings and verified user-submitted information. Data source Dealroom’s proprietary database and software aggregate data from multiple sources: harvesting public information, user-generated data verified by Dealroom, data engineering. All data is verified and curated manually. For more info please visit dealroom.co or contact support@dealroom.co Startups, scaleups, grownups and tech Companies designed to grow fast. Generally, such companies are VC-investable businesses. Sometimes they can become very big (e.g. $1B+ valuation). When startups are successful, they develop into scaleups (>50 people), grownups (>500 people) and result in big companies, like Adyen or Takeaway. In this report, the term “tech ecosystem” refers to startups, scaleups grownups from different vintages/cohorts. Only companies founded after 1990 are included in this report. Valuation The combined valuation of the tech ecosystem is based on their market cap or latest transaction value. Transaction value is realised from exit or implied unrealised valuation from the latest VC round, which is either announced or estimated by Dealroom based on benchmarks. Venture capital methodology & definitions. October 2020