Frequently Asked Questions (FAQ): Spain's Startup Ecosystem

Updated: 6 days ago

- Spoiler: Yes, there are unicorns from Spain.

  1. How mature is the Spanish Tech Startup ecosystem?

  2. How big is the Spanish online market?

  3. Is there a willingness to pay online in Spain?

  4. What are the key drivers to purchasing online in Spain?

  5. Which social media channels are most used in Spain?

  6. How big is the interest from international investors in Spain?

  7. Who are the main contributors to the Spanish startup ecosystem?

  8. Are there many Spanish startups with female founders?

  9. Are there any Startup unicorns from Spain?

  10. What is the startup lingo specifically for Spain?



1. QUESTION: How mature is the Spanish Tech Startup ecosystem?

ANSWER: Spain can confidently mark these 3 checkboxes of having a mature startup ecosystem as a whole, not just in Barcelona:

a) Notable exits from founders turning Angel investors and Mentors.

b) Successful role models building global scaleups, beyond LATAM. c) €1 billion+ in yearly investment in Spanish startups from seed stage.


Some could rightfully argue that the startup hub in Barcelona has been mature enough for some years already. However, what we see now in Spain are maturity signs being visible in more places like Madrid, Valencia, Malaga, Bilbao and growing stronger in many more Spanish startup hubs by the minute, with an increased global ambition.


a) Here are two examples of Spanish founders who post exit decided to pour a lot of money back into the system to stimulate the funding of new startup ventures in Spain.


The year 2018 reaped a total of 34 Spanish public startup exits, founded by Spanish entrepreneurs. An impressive increase from 2017 when the number was 15 public exits.


Repsol acquired 70% of the startup Klikin co-founded by Gustavo Garcia Brusilovsky. Back in 2010 he sold the online shopping club Buyvip to Amazon for € 70 million, generally agreed on being a brick for the future building of the thriving Spanish startup ecosystem of today.


Another protagonist is Miguel Vicente who founded the Social Shopping-company called LetsBonus.com in 2009 and already in 2012 sold it to LivingSocial, an e-Commerce platform partially owned by Amazon. (The price of the deal was never made public but "good sources" claims it was close to €50 million.) After this exit he co-founded Antai Venture Builder, the VC firm behind success cases like Glovo and Wallapop.


In an interview (Nov 2019) he says:

“If I compare with 10 years ago it was difficult to attract international VC's to Spain. Now almost all Tier 1 funds have someone looking specifically at Spain. This is exactly what has made a difference — we’re on their radar now.”

b) Here are two examples of role models on the Spanish startup scene, being generous enough to share their war stories, from the very start all through the many years of uncomfortable roller coaster rides, to ultimately having built truly global scale-ups that is making customers, partners, employees and investors happy and proud.


Oscar Pierre, the Spanish co-founder and CEO of Food delivery service Glovo, really told it like it was throughout their global growth journey at Slush in Helsinki (Nov 2019).


Click image to view the interview with Amy Lewin, Sifted


It wasn't exactly a smooth ride for Glovo to raise series B money. Back then, although only a few years ago, this kind of amount of money wasn't available from Spanish investors so you had to go outside Spain for fund raising. (now changing and more international VC's are now spending more time and money in Spain.) Glovo got big NO's from 116 investors until they finally found interest from Japanese Rakuten, "only weeks from having to shut down".


Another role model for Spanish entrepreneurs today is the Spanish scale-up Jeff (rebranded from mr Jeff). This poster child startup for the Valencia startup hub, initially offering laundry and dry cleaning services, have now broadened their scope to being "a service platform for people's well-being".


Jeff has achieved a lot in a very short time and, to the benefit of the whole startup ecosystem in Spain, the CEO Eloi Gómez and team is continuously sharing various how-to details of startup building. After having rolled out their services all over Spain they found their golden business model in being a franchise.


In September, 2019, they announced that they were in the process of opening "new franchises in other Asian countries, reaching Vietnam, Thailand, Indonesia, Singapore and Hong Kong in the coming months." The number of franchisees is expected to reach 3,000, spread across Europe, Latin America and Asia.


c) Comparing with other much older and mature startup ecosystems, "only" €1 billion in startup investments can seem modest. However, now having passed the €1 billion mark two years in a row (2018 and 2019) is worth paying attention to as the "Spanish startup bonanza" started just a few years ago, at very low levels, and in a country with a historically much lower risk appetite for these kinds of investments than in Northern Europe countries.

Writes El Referente behind the graph below.


"Investment has not slowed down in the (Spanish) startup sector, on the contrary it is still very active and has gone from 199 public operations in 2018 to 203 in 2019."


2. QUESTION: How big is the Spanish online market?


ANSWER: The IAB report for 2019 shows that 7 out of 10 all Spanish Internet users are buying online. This equals 20.3 million Spaniards in the age of 16 to 65 years, 48% are women/ 52% are men.


EDIT in June 2020: Due to the pandemic, online commerce increased with 40% in April.


3. QUESTION: Is there a willingness to pay online in Spain?


ANSWER: Yes, and the digital advancements in Spain are notable in the last years.

Debit and Credit cards usage have gained a lot of traction online, implying that the fear of providing your card details to an unfamiliar, digital entity is disappearing also in Spain.


Although it is still true that cash payments are very common and preferred by many consumers the likes PayPal and Amazon have done a great job of wining the Spanish people's trust and PayPal stands for at least 10%* of all the payments done online.


More and more online payments services are quickly being added to the mix in Spain. I wouldn't be surprised if, in the next few years, a big piece of the pie will be chewed up by a few newcomers.


EDIT in June 2020: Due to the pandemic, online commerce increased with 40% in April.


4. QUESTION: What are the key drivers to purchasing online in Spain?


Image credit: Modified screenshot from IABeCommerce report 2019

ANSWER: Convenience is a very attractive concept and stands for 97% of the driving reason for why Spanish people buy online, followed by "Product offering" which comes in at 95%. At a close third place (93%) ranks "Price" and on forth place (71%) comes "Trust".


Interestingly, "Recommendation" is the parameter showing the biggest decline compared to the previous year and is only said to be a key driver by 46%.

Source: IABeCommerce report 2019.


5. QUESTION: Which social media channels are most used in Spain?


Image: Modified screenshot from IABeCommerce report 2019

ANSWER: What´s App usage (87%) has been sky high for many years and there is also a high usage of Facebook (90%), Instagram (60%) and YouTube (65%), with a rapidly growing activity for Twitter (55%) and LinkedIn (36%).


Source: IABeCommerce report 2019.


6. QUESTION: How big is the interest from international investors in Spain?


ANSWER: International VC's stand for 57% of investment volume in 2019


"Foreign investment funds continue to bet on Spain and have an increasingly relevant presence", it says in the report "Tendencias de inversión en España en 2019" from Fundación Innovación Bankinter.


It underlines the continued value-add in terms of actual volume brought in to Spain by international investors, paving an easier way for Spanish startup founders to raise bigger series B and C rounds in the future.


"Although they participate only in 15.6% of operations, they account for 56.8% of the investment volume in Spain. These type of funds participate in Series B and C operations, i.e. between $5M and 20M."

European VC's have definitely increased presence in Spain looking for startup investments.


According to the mentioned report "Tendencias de inversión en España en 2019", the 15 most active international VC investors in Spanish startups during 2019 were, in order of size of €investment in Spain:


1. DN Capital

2. Mangrove Capital Partners

3. Lakestar

4. Harbert European Growth Capital

5. The Venture City

6. Target Global

7. MIP - Milano Investment Partners

8. GP Bullhound

9. 360 Capital

10. Acom Ventures

11. Seal Rock Partners

12. Everblue Management

13. Rinkelberg Capital

14. SPF Investment Management

15. Prime Ventures


It is worth pointing out that it now seems that the Spanish family offices, after many, many years of hesitation, and rightly so, are finally ready to further diversify their investments and take a risk with putting their money into growing Spanish startups, at a time when the Spanish startup ecosystem is mature enough.


7. QUESTION: Who are the main contributors to the Spanish startup ecosystem?


ANSWER: Some of the best known accelerators in Spain, because of being first out, are Seedrocket (2008), Tetuan Valley (2009), Wayra (2011) and Lanzadera (2013).


There is a comprehensive report from El Referente (Dec 2019), with “185 initiatives in Spain to support startup building” giving details about both public and private initiatives to assist startups in Spain.


José María Torrego, Director of El Referente, writes in the foreword:


"Spain has now 3,600 startups, with 1,059 in Madrid and 921 in Barcelona, the country’s two principal innovation hubs. Madrid also has the highest number of accelerators and incubators (over 50) and, in part, this is thanks to large companies and corporations, who are playing a key role in the sector, having launched 25 Open Innovation and acceleration initiatives emerging in Madrid alone."


"Nationally, there are already more 50 corporations with at least one innovation initiative in place. The sectors with the most demand for startups are the Health, Energy, Fintech, Insurtech and Traveltech sectors."


"Practically all of Spain’s autonomous regions (17) carry the DNA of entrepreneurship and innovation in their veins and are creating local ecosystems to promote the creation of startups and this report includes a long list of initiatives that reflect this."

8. QUESTION: Are there many Spanish startups with female founders?


ANSWER: Female led startups in Spain are about 20%.


A study made by South Summit (2018), with data from 1.252 Spanish startups that registered for their annual competition, showed - similarly as for the rest of Europe - that the Spanish, female startup founders are on the rise;


"For the first time, the percentage of women founders of startups in Spain grows, now 22% compared to 18% in 2017."


When it comes to gender diversity, Spanish women-led startups are getting access to more VC cash. Wayra, Telefonica´s start-up accelerator, announced in Nov 2019 that they will dedicate €2 million in funding on women-led startups in Spain.


The Wayra initiative has support from Spanish VC's Caixa Capital Risk, Inveready , JME, Kibo Ventures, Nekko Capital, Sabadell, Swanlaab and The Venture City.


9. QUESTION: Are there any Startup unicorns from Spain?


ANSWER: Yes, Spain has two startup unicorns. Cabify (Uber competitor) and in the late 2019 the delivery service Glovo also reached the elusive Unicorn status.


Quote from the magical news (pun intended) in Tech Crunch:

"The Barcelona-based startup says the latest raise has pushed its valuation past $1BN — putting it into a very exclusive Spanish unicorn club, with the likes of ride-hailing giant Cabify."

Most probably in the coming years, we will see many more Spanish startup bulls transform into unicorns since many investors argue that the Spanish Startup Scene is fertile ground for more $billion valuations.


10. QUESTION: What is the startup lingo specifically for Spain?


ANSWER: You want to look for the people that in Spanish are called "Cracks"! Think about festive and explosive firecrackers (not crackheads...)


These individuals can be anyone playing in the Startup ecosystem in Spain and can best be described as sociable, highly valued and admired people whom you definitely need to get to know over coffee, but offline!! Oh and the important word Unicorn?? It is similar. It becomes "Unicornio".


NOTE: This FAQ will continuously be updated and filled with more questions and answers.


Crafted by Caroline Lagergren


What do you need to know about Spain's startup ecosystem? Get this 70 pages, data-rich* report for clarity! (€20): REPORT: Spain's startup ecosystem and digital economy * Packed with names you will want to contact. ;)



0 views

Let's get in touch!

Hello [at] expandtospain [dot] com 

Calle Salamanca 16
46005 Valencia, Spain​​

  • YouTube
  • Black Twitter Icon
  • LinkedIn - Black Circle

© 2018-2020 Expand To Spain™/Flashlight Consulting AB