Investments in Turkish startup rise in second quarter: Report

ISTANBUL

In line with the global startup activity, the Turkish startup ecosystem witnessed growth in both deal volume and deal count in the second quarter compared to the January-March period, according to a report by KPMG.

There were a total of 77 deals in the second quarter of 2023, and the total deal volume was $150 million, including startup acquisitions.

Insider, a Türkiye-based software company, attracted a late-stage investment of $105 million from Qatar Investment Authority, Esas Private Equity and an undisclosed investor, becoming the biggest deal of the quarter.

Without the acquisitions, total deal volume was $147.5 million, marking a growth compared to the second quarter of 2022 at $99 million, the report said.

Including the startup acquisitions, the total deal volume reached $149.9m with a total of 77 deals.

Late-stage investments constituted 70 percent of the overall deal volume and took the lead, while seed-stage investments followed by a total share of 20 percent, it added.

In terms of deal count, seed-stage investments recorded the highest number with 62 transactions, followed by nine acquisitions.

“Except from the acquisitions, which remained unchanged compared to the previous quarter, there has been an uptick in the number of deals across all investment stages… In addition, five of the top 10 deals were seed stage investments.”

The top 10 deals represented 86 percent of the total deal volume.

Foreign investors held a larger portion, accounting for 75 percent of the total deal volume, while the local investors constituted 25 percent, the report said, adding that, however, in terms of deal count, local investors were in the lead with 67 deals compared to foreign investors’ 10.

The fintech vertical had the highest number of deals with nine, followed by seven deals in gaming and six deals in marketplace verticals, respectively, according to the report.

In terms of total deal volume, SaaS (software as a service) had the highest funding with $108.2 million, followed by $7.8 million in sustainability and $7.1 million in Fintech verticals.

Fazla, a waste management company, received an early-stage investment of $6 million from a group of investors, while Alternatif SuperApp, which provides digital wallet services and offers secure mobile payment, received a $3.6 million early-stage investment.

Gisecke & Devrient, a German-based mobile security company, acquired 50 percent shares in high-tech card development and production center E-kart for a consideration of $2.5 million.

Frantic Games, a mobile game company, received a seed-stage investment of $2.4 million, and Saha Robotik, a robotic delivery technology solutions company, raised $2.3 million in seed-stage investment.