Turkey is one of the core markets for Startup Wise Guys, with 26 investments so far

As an 11 years old global accelerator fund, Startup Wise Guys established in Estonia and it invested in 390 startups from all around the world. As for Turkey, they have invested in 26 Turkish startups so far, viewing that Turkey is one of their core markets and every year they have receiving more and more applications from Turkey. Let me add that Startup Wise Guys is a B2B fund, focusing and investing in SaaS, fintech, cybersecurity, sustainability and XR. And very recently they introduced 2 new verticals: Web3 and proptech.

“Turkey has a very young entrepreneurship ecosystem, around 2010 Turkish startup ecosystem started to shape and especially in the last 3 years many new VC funds and also country’s first unicorns and decacorns joined the scene,” said Günce Önür, General Partner at Startup Wise Guys. I interviewed Önür and here’s what she told me.

What’s Startup Wise Guys? Can you tell me the brief story of Startup Wise Guys?

Startup Wise Guys is a global accelerator fund for passionate B2B startup founders. It was created 11 years ago in the nowadays unicorn land Estonia. Initial funding was sourced from tech entrepreneurs reaching success after Skype’s exit which brought a lot of financial resources in the startup ecosystem of Estonia.

The Startup Wise Guys accelerator program was international from day 1, it was run in English and already the very first accelerator cohort welcomed startups from different countries. Today Startup Wise Guys has been regularly nominated among the most active early stage investors in Europe, with significant impact also in Africa, and also boasts to be one of the most international investors out there, both in terms of the team (20+ nationalities, 60 people), but also portfolio which has founders from more than 65 countries. Since 2012, Startup Wise Guys has invested in 390 startups from all over the world.

Investment criteria of Startup Wise Guys

 As Startup Wise Guys, what are your investment criteria? What kind of startups are in your radar?

We are B2B focused and investing in the following verticals: SaaS, fintech, cybersecurity, sustainability, XR, and this month we launched 2 new verticals: Web3 and proptech.

To get our investment a startup should have at least 2 people team, some initial traction and a tech product. As Startup Wise Guys we are waiting for the startups who are targeting global markets from day one and also aim to become international and sustainable companies.

As a fund, how do you raise your capital? What are your criteria to be your investor?

We are proud to be mostly privately funded, and only on very rare occasions running programs with public money support as was the case in Lithuania, where we received EU funding for 5 accelerator programs and seed fund.

Historically Startup Wise Guys investors were mostly successful tech entrepreneurs that wanted to give back to the community and support the next generation of entrepreneurs. As well as family offices, other VC funds.

Apart from matching investment strategies and other metrics, for us the value fit is very important – we are very founders focused investor and ready to invest in a rather early stage which involves a lot of risk, but also the positive impact is the highest. We have observed that we work better with investors that are aligned with this approach and are also looking for a positive impact along with growing their money.

I noticed your focus is Central and Eastern Europe. Are you planning to expand to different geographies?

Startup Wise Guys is a global accelerator fund and we already have a portfolio with founders from more than 65 countries. Given the origins in Baltics aka Central and Eastern or Northern Europe, this is also historically majority of the portfolio founders were coming from. First programs were run from Estonia, then expansion to Latvia and Lithuania happened.

As of 2020 Startup Wise Guys has been expanding also beyond the Baltic market in terms of offices and program locations – first Italy (Milan and Cosenza Offices), then Spain (Malaga and Bilbao Offices), as well global pandemic presented us a unique opportunity to run online-first program in African continent, we are focusing on Sub-Saharan Africa countries and have already run 2 programs there.

If we look at portfolio composition, for the last few years Turkey has been one of the leaders in terms of investments, along with Estonia, Lithuania, and Ukraine. In recent years the picture is changing and more Italian and African teams are joining the portfolio.

Turkey’s potential in SaaS, fintech and gaming

A specific question about the Turkish market: how do you see the startup scene in Turkey? What type of startups do shine out?

As Startup Wise Guys, we have invested in 26 Turkish startups so far. Turkey is one of our core markets and every year we are receiving more and more applications from Turkey.

Turkey has a very young entrepreneurship ecosystem, around 2010 Turkish startup ecosystem started to shape and especially in the last 3 years many new VC funds and also country’s first unicorns and decacorns joined the scene. Besides economic and political instability, Turkey has amazing tech talent and specifically carries lots of potential in SaaS, finTech and gaming areas.

We believe that the Turkish founders need, in terms of global sales and scalability and what we offer in Startup Wise Guys investment programs are fitting each other perfectly and we will be investing more Turkish startups in the future.

As a 10-year-old fund, what kind of changes did you notice, both in startups and investors?

We celebrated our 11th birthday in the beginning of this year and are one of the rare original investors that emerged in Europe this time frame and is still growing and actively investing.

Obviously, lots have changed in the market since our early days.

Firstly, the availability of funding for early stage startups. When we started off, in most of the markets, where we are active, there was insufficient locally accessible early stage funding for startups. This meant that many either died or were looking at bigger markets like the US to grow their business and fundraise. Nowadays, the situation has radically changed and it is not startups chasing investors, but investors chasing the good startups. There is fierce competition among funds, business angel syndicates, VCs, and also – in recent years there has been a lot of governmental and other public money distributed as grants for the startups, which obviously change the fundraising environment radically.

If we look at the startups, there is definitely way higher maturity we work more and more with serial entrepreneurs, not first-timers. Startups have way higher expectations and also know basic things already, that is one of the reasons why we are moving into verticalization – i.e., running programs with vertical specific content and network, as we see that this is where we can still add a lot of value as an investor.