Northzone ❤ NYC
Since the first immigrants set foot ashore in New York City, the city has been a confluence of creative and economic forces, fueled by wave after wave of hard working and resourceful people looking to create a future for themselves. When my aircraft approached Newark International Airport three and a half years ago, The Statue of Liberty and Ellis Island greeted me, just like millions of immigrants before me. So what prompted me to go west? It sure wasn’t the poor potato harvest in Sweden that made me uproot my family from the lush surroundings of Stockholm and settle in the midst of the concrete jungle of Chelsea, Manhattan. As you’ve already guessed, there’s something special about the fast growing technology ecosystem in New York, and we wanted to be a part of it.
Since Northzone’s inception 20 years ago in the Nordics, we have invested in transformative technology opportunities. To this day, we still seek to be one step ahead of the intersection of change. Our ambitions quickly outgrew the Nordics; we started partnering with entrepreneurs in hot spots such as London, Berlin, Paris, Barcelona, Moscow — and since 2013, also in New York City. This September, we announced our eighth, and largest, fund to date at $350 million. We couldn’t be more excited.
Northzone has been fortunate over the years to be chosen as a partner by many hard-charging entrepreneurs with global mindsets. In most cases, their journey brings them to US soil. When we led the first investment round in the Stockholm-based Spotify in 2008, the home market of Sweden was never the end goal, just the beginning. Today, Spotify’s largest market by a wide margin is the US, with over 800 Spotify employees calling New York home at 45 West 18th street, just a half block away from our own office at 33 W 17th Street. When we invested in Danish startup Trustpilot in 2011, Peter Mühlmann had his sights on the world’s largest market. Fast forward five years and Trustpilot has over 200 team members in their office on 5th Ave, and the US remains a top strategic priority. We are looking forward to seeing what the Qapital team and their brilliant consumer savings app, engineered in the Old Town of Stockholm, accomplish together with their Flatiron-based commercial team to rock the staid US consumer banking market. Similarly, Bloglovin, the world’s largest influencer marketing network and the online mobile classifieds app Letgo, boast dual Euro-US identities with significant operations on both sides of the Atlantic Ocean.
We strive to bring our domain expertise to bear when investing in local NYC startups. Brooklyn-based Jukely delivers a unique live concert subscription service to the world of music fans. Our extensive networks developed as investors in many music related startups, including Spotify and X5 Music Group, has opened doors for Bora Celik, Jukely’s founder and Turkey-born master coder and EDM concert promoter, to help him really scale the company. Perhaps surprisingly, mobile gaming is a Nordic specialty with most of the global successes coming out of Stockholm and Helsinki. Therefore, NYC-based Paul Murphy and his team at PlayDots chose Northzone as their preferred partner for growth. This is only the beginning. Our expanded New York team is busy at work in the five boroughs and beyond; thinking globally alongside outsized entrepreneurs is in our nature.
When we partner with entrepreneurs, we bring over 200 years of investment, entrepreneurial and leadership experience in Europe and the US. Over the years, we’ve developed strong relationships with most preeminent co-investors across the globe. We’ve always sought to put entrepreneurs first when navigating new markets, and we are happy that our entrepreneurs are consistently our best references. The EU economy is in fact larger than the US economy, yet it’s really comprised of 28 unique countries, with different cultures and unique customer behaviors. Navigating this requires deep local contacts and knowledge. With offices in London, Stockholm, Oslo, and with our roots in Berlin, Copenhagen, and Amsterdam, we bring our European networks to bear when partnering with US entrepreneurs and management teams looking to enter or expand into Europe and beyond.
I have been investing in early stage technology companies since long before touching down at Newark International; probably longer than most local New York VC’s have been in the game (or in some cases, been alive!). It helps, when relating to the hard realities of entrepreneurship, to have walked the walk. I owned and ran a struggling fish distribution business, built a business incubator which I sold at the peak of the dotcom bubble, and long before that, I survived as a touring heavy metal musician by selling vacuum cleaners door-to-door. I’m no stranger to the ups and downs of the entrepreneurial journey.
Northzone has invested in over 120 companies, leading to 30 big wins, many costly write-offs, and a few too many missed opportunities along the way. From digital media (Spotify, Fishbrain, Bloglovin’), marketplaces (CornerJob, Letgo/Wallapop, Avito), adtech (VideoPlaza, Widespace), fintech (Klarna, iZettle, Market Invoice, Qapital), gaming (PlayDots, Seriously, SpaceApe), B2B software (Trustpilot, Universal Avenue), to e-commerce (Outfittery, Lesara, Matsmart), we’ve become engrained in significant categories and have expanded our team to build our expertise to match the highest expectations of star entrepreneurs. This past year, we welcomed Michiel Kotting and Jessica Nilsson as new Partners to the firm. Michiel brings a wealth of knowledge down and across the tech stack from his years as an AI entrepreneur, healthcare executive, and investor with Accel. Jessica founded Hello Fresh, the original, now global, food delivery subscription service, which inspired a well-known, Blue Apron-clad New York unicorn.
It’s no secret. New York increasingly holds tremendous opportunity for tech entrepreneurs seeking to solve important problems and create new markets. In the coming years, the opportunity to wrestle the global fintech crown from London is New York’s to lose, given uncertainty around Brexit and the depth of New York’s legacy financial expertise. Whichever city prevails, we’re locally present in both and remain very optimistic on the sector. It’s no secret New York is the place to launch a media startup. Most cool e-commerce startups in recent years are New Yorkers. We know how to help build these companies and we’re looking for the next giants. Adtech? It may feel like the depth of winter for many parts of the industry, but there is still no better city to build the next billion dollar adtech business. Food? Sure, we’ve done it. Blockchain? Let’s talk.
When Northzone was founded, the internet was in its infancy and cell phones were slightly larger than bricks and certainly just as heavy. We’re more bullish than ever in our belief that today’s world holds exponentially more potential for entrepreneurs creating the future. We look forward to the years ahead as we continue to build the world’s preeminent transatlantic venture fund.