With the intention of serving as a hub for scouting startup investments and acquisitions in Europe, Samsung Electronics Co.is opening up an office in Berlin.
As a part of a push to invest in and acquire fledgling companies in areas such as connected appliances, AI and augmented reality, Samsung is scouting office space for next year as the company’s arm, Samsung NEXT, the South Korean tech giant’s $150 million venture capital fund, already has two investors on the ground in Berlin. This was informed by an entrepreneur and VC who joined Samsung in April, managing director Felix Peterson.
“In Europe it’s very hard for an entrepreneur to do a $40 million, $60 million, $80 million exit. In the U.S. you can do it as an acqui-hire,” Petersen said. “These smaller, deep-tech exits which in Silicon Valley are super-common because the teams already have the relationships with Google and Facebook are harder here. We want to position Samsung as an exit channel here for deep tech.”
LoopPay, which became the smartphone payment service Samsung Pay, and home automation startup SmartThings, are among some of the companies and startups that Samsung had previously acquired as it vies with Apple Inc. as the world’s top mobile phone maker.
According to Global Corporate Venturing Analytics, up from $76.5 billion in 2015, $83.2 billion in startups globally last year have bene invested by Corporate VCs, which typically fund investments from their own treasury instead of seeking outside partners. And in the last three years, more than a third of deals have been corporate-backed and range between $10 million and $99 million.
And investing in business technology startups to the tune of $1 billion last years was SAP’s Sapphire Ventures. And, also active in technology investments are companies and groups like Google Inc., Salesforce.com Inc. and Qualcomm Inc.
While looking for a permanent office, Petersen and Samsung investment manager Nick Nigam are operating out of a co-working space in Berlin for now. Petersen had spent two years with Faber Ventures in Lisbon before joining Samsung this spring.
With its teams spread out in a number of parts of the world including in San Francisco, New York, South Korea and Tel Aviv, Samsung NEXT, which was launched in January, is based in Mountain View, California. The investment arm of the South Korean tech giant has put money into startups including drone aircraft company Converge Industries and cloud video game company Liquid Sky and the arm is aiming for early-stage to Series B round investments.
“We have more resources than a normal fund that lives off 1 or 2 percent management fees,” he said
(Adapted from Bloomberg)