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Articles from Informilo, the technology news site that links business with innovation.

It is not surprising that Paris-based Criteo, an ad tech company that prices and supplies personalized advertising in real time for its e-commerce clients, had an upsized IPO on NASDAQ in late October.Worldwide digital ad spending topped $100 billion in 2012, according to eMarketer. And digital ad expenditures are projected to nearly double between 2012 and 2016, increasing to $163 billion from $87.3 billion. Digital ad spending is in fact growing faster than total media ad spending and will drive overall growth in ad spend. That is because as more people become Internet and mobile Internet users, marketers across the globe are expected to continue to increase their budgets for online and mobile advertising.

If the pundits are right, the effectiveness of those ads will depend largely on personalization and other types of effective targeting. It is little wonder then, that companies that understand how to operate in this new environment like France's Criteo, Germany's Adtelligence, the UK's Unruly Media, and Israel's Outbrain, are generating lots of excitement.

These ad tech companies plus others including Buzzing, Viewster, Rank Above, Perform Group and Populis, will all present at NOAH Conference, an annual event focused on late-stage Internet companies; this year it is expected to attract some 2,000 attendees.

The theme of the 2013 conference is, "How big can Europe's Internet companies get?" In online verticals such as advertising, travel, commerce and gaming it appears that even the largest of Europe's Internet companies have not even started to realize their potential. With significant growth possibilities still ahead they could well reach new heights.

The advertising market is a prime example. Worldwide digital advertising spending levels - including online and mobile advertising spending - represented 21.7% of the total spent on ads in all media this year and is set to account for more than one-quarter of all ad spending. That means more than three quarters of the global advertising market is still up for grabs.

Online leisure and unmanaged business travel in Europe was $246 billion in 2012 but only about 42% of the business is currently conducted online, according to a forecast in the European Online Travel Overview, Eight Edition, by PhoCusWright, a research company specializing in global travel.

In commerce, too, the biggest opportunities are yet to come. In 2012 more Europeans consumers bought videos/DVDs, music, event tickets and computer software online than offline. And Europe will be the largest eBook market in the world by 2017, with revenues of $19 billion, according to Forrester Research. It predicts online retail sales in Europe will reach €191 billion by 2017, up from €112 billion in 2012, reflecting an 11% compound annual growth rate over the next five years.

And, despite impressive growth in countries such as Germany, Britain and France, online commerce still only represent less than 14% percent of overall commerce in these key European markets, so the largest part of the market is still offline. The same is true for the U.S. market (see the chart).

Online gaming is no exception. Even though a report by Digi-Capital, an investment bank that specializes in mobile and games, predicts that mobile and online games could grow the total global video games market size to $83 billion, the sector will still only represent 55% of the total market's revenue.

"Looking at all these numbers, one message is clear, Internet is the largest parallel economy and there can only be one question: Are you with or are you against us? Co-opetition for bricks and mortar has to be the answer for survival for the incumbent businesses," says Marco Rodzynek, a partner at Noah Advisors, the corporate finance firm behind NOAH.

For start-ups the opportunity is big, so the ambitions for companies need to be big as well. "We at NOAH look at companies addressing sizeable market opportunities with quality products and bullet-proofed execution plans. Ninety percent of the companies we see are operating in too small niches or have product features which do not justify a company," says Rodzynek.

While the projected growth and the opportunity in digital advertising is huge, Rodzynek warns that success is not guaranteed. "Criteo has it all: market leadership, a global business, growth, a large underlying market size, a super management team and even profits, which should convince the most critical U.S. investor," he says. "However, to get to the next level, the Google type of positioning, Criteo needs to get either exposure to users or diversify its business to other online marketing tools. Just to be in the middle between advertisers and publishers is long term not attractive as we have seen with the affiliate marketing players, like TradeDoubler."

Keeping up with the pace of change is not easy. Unruly Media COO Sarah point points to a recent Adobe study in which 76% of marketers said their work has changed more in two years than in the past 50. (See the story about Unruly Media on page 6.) Part of what is driving the change in advertising is the fact that 1.4 billion people, or one in five people around the world, went online via their mobile devices last year. Mobile usage has helped drive Internet adoption in Asia-Pacific, Latin America, the Middle East and Africa. So, marketers have begun to allocate a larger portion of their advertising budgets to the mobile ad market in recent years.

And how. Worldwide mobile ad spending is forecast to increase to $36.9 billion by 2016, up from $13.58 billion in 2013, according to eMarketer. The Asia-Pacific region previously had the largest mobile ad expenditures worldwide, primarily due to advanced mobile advertising markets in Japan and South Korea. However, consumers are rapidly adopting smartphones and tablets in the U.S. and marketers there are taking advantage of growing mobile ad opportunities, causing North America to surpass Asia-Pacific last year with $3.9 billion in mobile ad spending. And in 2015 an expected surge in mobile ad investments in Western Europe will push Asia-Pacific to third place.

eMarketer is predicting that rapid mobile Internet adoption combined with the continued development of mobile ad networks and greater choice of mobile ad formats will significantly enhance how marketers use mobile to engage consumers, especially in North America and Western Europe. Facebook's and Twitter's mobile advertising streams, as well as mobile's potential for audience targeting, will also attract marketers.

In online travel, "mobile is actually growing the online pie - as it offers a novel platform to those who normally wouldn't book online," says Luke Bujarski, PhoCusWright's director of research.

Online travel companies in Europe are vying for a bigger share of the digital pie. Amsterdam-based Booking.com, which is now owned by the U.S.'s Priceline, covers over 350,000 properties, features 24 million reviews and 10 million photos on its site, and offers 24/7 customer service in over 40 languages' it's a dominate force in the market. European players in niche markets, like HouseTrip, which is presenting at NOAH, are also building booming European Internet businesses. And the number of online travel start-ups eager to grab their share of domestic markets is mushrooming. In Russia, for example, Ozon's travel site competes for business with a whole crop of new entrants, including Ostrovok, OneTwoTrip, Travelmenu.ru, Traveltipz.ru, anywayanyday, tutu.ru, Travelatte and Oktogo.

But online adoption of travel varies widely across European markets, so success is not equally distributed. The UK, Scandinavia and France have a higher proportion of people who book online versus through traditional channels, says Bujarski. Spain and Italy are still somewhat behind when it comes to online travel booking adoption as "the Internet connectivity is not quite there and the overall channels for e-commerce are less developed," he says. And, high rates of unemployment and depressed local economies are making things worse in these markets.

Germany is a special case. "There are very high rates of travel and the country has a high GDP but the amount of travel booked online is relatively low compared to the UK," says Bujarski. "There are a few reasons for that: Germans tend to buy packaged travel, they stick to tradition and book their vacation packages with traditional travel agencies."

Thomas Cook, a traditional globally-focused travel agency with an online presence, has stated that it hopes to achieve 50% web penetration by 2015, says Bujarski. What's more, the barriers to entry for new travel brands to enter this market are high since established players like Booking.com and Expedia have big marketing budgets.

It is tough to get people to come to new sites, especially when competing with big, established brands. Airlines have also gained increasing share of online bookings as they bombard the market with loyalty programs and new web channels to bring customers directly to their websites, Bujarksi says.

Hotels potentially hold the biggest promise for growth for new entrants. While established online travel agencies brands currently dominate this online segment, PhoCusWright says it believes metasearch and service updates made available directly by hoteliers could influence market dynamics and the online split between direct and intermediate bookings.

Expedia earlier this year acquired a 61.6% equity stake in Trivago, a German metasearch company that focuses on hotels, for approximately €434 million in cash. Trivago compares more than 600,000 hotels across 140 booking sites in more than 30 countries and 23 languages. Expedia is hoping the acquisition will allow it to expand into the European online travel market, taking business away from Priceline/Booking.com, which uses Kayak, a U.S.-based travel metasearch engine. Kayak has changed the way people search for and book flights and is now expanding to offer complementary services directly, like hotel and adventure bookings. These developments could cut into new entrants' online traffic.

At the same time, content is becoming a big factor, says Bujarksi. When people go to TripAdvisor's site they get hotel reviews, which is seen as a value add for the customer, so that, too, could hurt upstarts that don't have the means to offer similar services.

The overall European online travel market is growing an average of 10% a year, says Bujarski. "There is a lot of remaining capacity to move online. But how it is all going to go, nobody really knows for certain. Tour operators will continue to have successes with bricks and mortar stores, particularly in smaller markets, for some time to come."

As with advertising and online travel, mobile is changing e-commerce in Europe, which is home to successful e-commerce giants such as Asos and Zalando. Europeans have become expert at adapting e-commerce models to individual markets and building out to other markets in rapid succession; and some of the biggest opportunities for e-commerce companies are in emerging countries.

That said, since only about 14% of global shopping is done online so far, e-commerce has by no means reached its peak in even the most developed markets. Start-ups still haven't figured out what to do with 75% of the market. The way to capture those purchases will be through mobile, predict venture capitalists Informilo interviewed. Today nearly half of local shopping starts on a mobile browser and approximately one in three mobile transactions are actually done in a store.

Forrester Research data shows that more than half of European online buyers have already used a tablet or mobile phone in the past three months to support a purchase in some way. Its mobile commerce forecast for 2012 to 2017 predicts that mobile ecommerce revenues across Europe will rise from €1.7 billion in 2011 to €19.2 billion in 2017, reaching 6.9% of sales and changing the face of retail.

Mobile payment services are being merged with gift cards and loyalty and rewards programs, potentially transforming shopping more in the next few years than the Internet changed retail so far because it will impact everything people buy.

So what will the future of shopping look like? Online-only stores such as Warby Parker and Fab will open bricks and mortar outlets. No more worrying about redeeming coupons or loyalty points - anything you have earned in the online or offline world will be digitally recorded and automatically deducted at time of purchase, no matter where you buy. Since payments are mobile they will no longer be tied to old-fashioned cash registers, freeing sales assistants inside stores to help customers check out and pay from the aisle or the changing room. Window shopping will take on a whole new meaning: city dwellers out for a stroll will scan items on mannequins with their mobile devices and click to buy and ship, even if the high street store is closed for the day.

Relevant location-based shopping experiences will become the norm, meaning customers will be able to skip waiting in line, by ordering remotely and picking up their food or favorite drink in-store.

In this new omni-channel world, merchandise and promotions will not only be consistent across all retail channels, adapting to consumers who want to use different channels simultaneously, the offers will be personalized according to a specific consumer's purchase patterns, social network affinities, website visits, loyalty programs, and other mined data.

Creating an omni-channel shopping experience for consumers presents opportunities for established companies like PayPal and Google as well as for start-ups.

But when it comes to global e-commerce - whether it is selling physical goods or providing new types of mobile payments - it is all about execution, adaptation to local markets and who has the deepest pockets.

The key to the success of Rocket Internet, a Berlin-based incubator which scouts for successful business models and then clones them in new markets, has been good execution and deep pockets coupled with a very focused local approach. Rocket is currently operating over 50 such companies in Europe, Asia and South America.

The market traction enjoyed by Zalando, a global hybrid Zappos and Asos clone that has a valuation of €3.6 billion and is now active in 14 European markets, can be partly attributed to heavy TV advertising. (The company started life as a Rocket Internet company.) Zalando, which is expected to go public, built its brand in its home market through a deal with Germany's ProSieben-Sat.1, a mass media company that operates commercial television and premium online platforms and generates some €1.5 billion in TV ad revenues per year.

In a maturing TV ad market, ProSiebenSat.1 was actively searching for new growth segments to leverage its excess ad inventory and decided to take an innovative approach by selling prime time ad spots to start-ups at a discounted rate plus revenue share and equity stakes.

Zalando is among the start-ups that originally took the media company up on its offer. Now the German TV giant is running a contest at NOAH for the second year in a row, giving away millions of euros worth of ad spots to other start-ups. It now operates a division called Seven Ventures that takes majority stakes in start-ups targeting the German market and tries to help make them market leaders through TV advertising. (See the story about this year's Seven Ventures contest on pages 12 and 13.)

While Rocket Internet companies make up a healthy percentage of e-commerce plays from Europe it would be wrong to paint the Continent as the land of copycats. Innovative European companies like Asos and Net-a-Porter helped pioneer fashion e-commerce and became global champions. France's vente-privee.com, which now generates over $1.5 billion in revenues, gave birth to the flash sales model which has since been copied around the globe.

Europe is also creating category leaders in gaming. One of the most successful, SuperCell, a three-year-old company which just sold 51% of its stakes for $1.5 billion, attributes its success to a "tablet-first" approach to its popular games, Clash of Clans and Hay Day.

The growth of mobile gaming is upending the business model based on the sale of games - and the devices used to play them. The new approach is to give away games for smartphones or tablets and then to earn revenue from in-game purchases, advertising and other add-ons. (See the story about gaming in Europe on pages 5 and 6.)

"Mobile has fundamentally disrupted the games market across sectors globally," Digi-Capital Founder Tim Merel says in a report. "For games, the transition to free-to-play and communal gameplay is changing sector dynamics, delivering up to 10x-20x revenue uplifts for market leaders."

He says he believes mobile Internet could create up to $11 trillion in value globally by 2025, across all industries, not just games. "Mobile Internet-connected devices, mobile broadband subscriptions, mobile data usage and mobile apps growth are driving disruption across all tech related markets," he says. That is the challenge, for Europe's Internet companies, and the opportunity.

No one is saying that it feels like 1999 again. The average time for a company to go public then was four years; now it is more like 13, says Nelson Griggs, NASDAQ's Senior Vice-President, Global Corporate Client Group.But European and Israeli tech companies are once again making headlines by opting for IPOs. Russia's Qiwi, a digital payments company, listed successfully earlier this year on NASDAQ and completed a subsequent follow-on transaction. France's Criteo, a data-driven advertising technology company focused on e-commerce listed on NASDAQ in late October, raising $251 million in an upsized IPO that further increased excitement around the sector. And Israel's Wix, which hosts build-you-own web sites, went public on NASDAQ on November 6th.

These IPOs were closely watched as there is a swelling group of European and Israeli companies in the pipeline that are rumored to be preparing to go public (see the chart).Regardless of the broader foundations of a firm's business activity and development, a disappointing IPO - or initially impressive flotation followed by a soufflé-like price deflation - can haunt even celebrated companies for months (just ask Facebook). Given the high stakes involved, start-ups need to insure their financial opportunity of a lifetime doesn't wind up being the worst move they ever made.

There's arguably no more critical chapter in a tech company's history than figuring out the right exit strategy. The good news for European companies is there are more options than ever. There are now multiple ways for European Internet companies to raise growth equity and going public is only one of them.

"An exit is like a love story," says Marco Rodzynek (pictured on Informilo's home page), a partner at Noah Advisors, the corporate finance firm behind the NOAH Conference, an annual event that focuses on late-stage Internet companies; this year the organizers expect to attract around 2,000 people. "You should admit only at the very end what you are really up to and should at all times keep the involved parties entirely focused on you."

You don't get to do an IPO over again if it doesn't turn out as you'd hoped, "so you want to make sure you're ready for it, have chosen the right market, and have the best legal and banking partners to help you make it a success," says Christopher Grew, a partner with global law firm Orrick, Herrington & Sutcliffe in London. "The key is identifying what different options and partners correspond to the specifics of your company and objectives, and will contribute most to your IPO being successful."

That's even harder than it sounds - and often depends first and foremost on where a start-up decides to list. Indeed, after the decision has been made to go public, most other considerations flow from the choice of market the company lists in. For a majority of European tech companies, the clear preference has been America's New York Stock Exchange (which handled 16 of the 20 largest tech IPOs in 2012) or NASDAQ, rather than the more local London Stock Exchange. For most people who've taken part in the internal deliberations of going public, the advantages and allure of a U.S. flotation have been evident.

"The chances of achieving a superior valuation are almost always better with a U.S.-listed IPO versus a European or London listing. This is driven by greater capital availability and the greater degree of analyst and investor specialization in the U.S.," argues Raphael Grunschlag, managing director and head of European technology banking at the global investment banking boutique William Blair & Company in London. William Blair recently handled the IPOs of Criteo and Qiwi. It underwrites approximately 20% of all U.S. IPOs.

"UK institutional investors have historically preferred essentially defensive positions and secure returns, which in part explains the low rate of tech IPOs in London," says Grunschlag. Another factor to consider is that despite the perceived volatility in the U.S., the window for IPOs actually stays open longer there relative to London. "The U.S. market can absorb several poor-performing transactions before activity decreases, while in London, a single disappointing IPO can shut everything down," he says.

That not need be the case - and influential actors in the UK are moving to make London a more attractive IPO market. Last March, LSE officials joined the UK government to ease rules governing public introductions in what's now called the High Growth Segment. Among those measure was a reduction of the minimum level of IPO stock from the previous 25% to the current 10%. That's still twice NASDAQ's 5% requirement for initial offerings, and doesn't address issues raised by critics like Grunschlag and Grew.

"When you'll raise $400 in a London IPO compared to $600 in New York, you'll list in the U.S. almost every time - as nine out of 10 European tech firms going public do," says Grew. "The only reason for a European company to stay local is if it's considered a national champion, or is otherwise so deeply rooted in national or regional markets or activities that listing in New York would pose a problem."

Other experts beg to differ.

"Yes, overvalued IPOs in the States are great, especially for VCs and founders, as Facebook, Zynga, Groupon and others have demonstrated," says NOAH Advisors' Rodzynek. "However, execution risks are high and once failed, direct and indirect costs could be a big, big burden on a young company. Don't feel like an Englishman in New York. Sometimes it is good to stick to your roots and not chase the highest IPO valuation around the planet."

Robin Klein, a partner with Index Ventures in London and a founding partner in The Accelerator Group, argues that the new LSE measures will make listing in London both more logical and profitable for European tech companies. He predicts the cost and hassle to Europe-based firms of having to face demanding U.S. investors (think trans-Atlantic commutes and culture clashes) is something that British and continental tech execs will gladly avoid. Klein also forecasts the debunking of what he calls the "mythology of higher valuation in the U.S." as a number of tech introductions in London prove it to be a "real and viable alternative to the NASDAQ."

That said, pundits agree that London needs at least one successful exit by a big Internet company on its local exchange. A number of London-based companies are expected to IPO, including King.com, Shazam, Badoo, Mind Candy and Wonga. It is not clear which will go first or whether any will choose to do a local listing.

"I wouldn't be surprised if there's some floats taking place in the next year or so," Klein told London's City A.M in September. "London is a sophisticated market and we certainly don't want [it] losing out in the most attractive sector for growth."

Of course Index is an investor in Criteo, which chose NASDAQ for its listing.

Nicolas Brusson, CEO of BlaBlaCar.com, a fast-growing pan-European car-sharing service and a scheduled speaker at NOAH 2013, wishes the LSE success in luring European IPO activity from New York, but thinks it's a lost cause among big companies - and a wasted battle for smaller ones. "Nobody under $100 million in revenues is doing IPOs anymore, and the rare smaller company that does will wind up on secondary markets like AIM that everyone would rather avoid," Brusson says. "Why go public with all the accountability and regulatory constraints that involves if you're going to be invisible on a secondary market, or largely overlooked as a tech novelty in London?"

That's an important question, since Brusson calls the IPO process "so incredibly complex, long, and filled with complications and delays" that companies need to be doubly certain they're ready to take the step before wading in at all. Once they're sure the time has come, though, the question then becomes which banking and legal partners to select to prepare for the flotation. Both Grew and Grunschlag say that though most leading firms have offices in both the U.S. and UK, tech companies would do well to opt for banking advisors and legal offices whose main activity is weighted in the same country as the IPO itself. And while most top-level firms boast activity in a variety of sector and company flotations, it's far wiser to find partners with experience - or even specialization - in the precise technology and niche an exiting start-up is involved with.

"In the end, you're looking for partners who understand you and your business, and can carry out their work on your behalf as though they're almost part of the (issuing) company itself," says Grew. "It's really vital everyone is rowing in the same direction, and feeling like they're part of the same tight-knit team."

Other Options

Of course not every company needs or wants to go public. More growth equity - from a variety of sources - is pouring into European Internet companies, helping companies get much bigger while remaining private.

When Swedish payments company Klarna raised a $153 million round in 2011, Sequoia Capital's Michael Moritz, who sits on the company's board, told TechCrunch that the round "is the public financing of 12 years ago. It is just done privately." The buyers in these "pre-public investment rounds" are the same investors that would have previously bought IPOs, funds like General Atlantic, DST, T. Rowe Price, Fidelity and Tiger.

For example, last year General Atlantic, a global growth equity firm, invested $44 million in Turkish online food ordering service Yemeksepeti.com. There was no need to do a road show to raise the round. Some 20 U.S. and European VC and PC firms trekked to Istanbul to see the company.

Venture capital firms are clearly also participating in large "shovel in" rounds. Before going public Paris-based Criteo raised $63 million from venture capital firms Index Ventures, Bessemer Venture Partners, Elaia Partners and Idinvest Partners, as well as from SoftBank Corporation, Adams Street Partners, SAP Ventures and Yahoo Japan. And Tel Aviv-based Wix , which serves customers in 190 countries and says it is growing at a rate of 34,000 new registered users per day, raised $61 million in venture capital from backers that include Insight Venture Partners, DAG Ventures, Benchmark Capital, Bessemer Venture Partners and Mangrove Capital Partners. Both companies were able to raise huge rounds even though they are based outside of Silicon Valley.

Expect more Asian companies, which are flush with cash, to invest in Europe's Internet companies, says Mattias Ljungman, a partner at Atomico Ventures. Eight of the 10 biggest merger-and-acquisition transactions involving game companies this year have been initiated by buyers based in Asia, according to Digi-Capital, an investment bank that specializes in mobile and games. These include the Supercell deal, in which SoftBank was joined by a subsidiary, the Japanese game company GungHo, in investing $1.5 billion in exchange for 51% of the shares in the Finnish gaming company. (Atomico is an investor in Supercell, as is Accel Partners).

Along with buyout funds and VCs, institutional investors clearly have more of an appetite for investing in European tech companies.

For tech industry executives who need smaller amounts of liquidity but aren't ready for an exit, NASDAQ is about to launch NASDAQ Private Market and is actively courting European customers. NASDAQ Private Market (NPM) is a joint venture combining NASDAQ OMX's resources and operational expertise with SharesPost's private company transaction platform. Though the firms remain private, they have shares, and some employees or investors who have received such stock want to cash out. Others want in. The sellers and buyers can be matched through NPM's electronic network of broker-dealers.

NPM lets NASDAQ tap into a new line of business. Tech companies are clearly waiting longer before going public and private company transaction platforms like SharesPost have benefited from this new way of trading shares privately.

The interest in buying shares in tech companies via private markets in the U.S. suggests bullish investor interest in companies that may come to market over the next couple years. NPM will give investors a way to get to know European tech companies before they go on an IPO road show, yet another potential way to stimulate appetite for more and bigger exits going forward.

Visitors to Unruly Media's headquarters are greeted by statements spelled out in cursive neon that speak volumes about the London-based start-up's focus.

The quotes - "nyan, nyan, nyan," "Go tell that, homeboy," and "Boom goes the dynamite," from Nyan Cat, Antoine Dodson and internet sportscaster Brian Collins, may have yet to enter the canon, but search for their names and you will see that each became an overnight sensation after millions shared videos of them online, helping to generate hundreds of millions more views.

Unruly Media tracks video on the social web and how the esoteric can suddenly go stratospheric. Companies in all sectors are searching for better ways to measure the impact of their tweets, Facebook updates, YouTube videos and other bids to engage the public. Unruly shares with brands what it has learned from watching, tracking and analyzing thousands of videos to help improve their online video content and spread it across the Internet. With the entire Internet essentially powered by advertisements, the opportunity to provide more accurate, higher-value, smarter ads is huge.

"We're growing rapidly because we're sitting at the intersection of the biggest, fastest-growing trends in all of advertising: mobile, video, social," says COO Sarah Wood. At her side in the "Nyan" meeting room sits CEO Scott Button, a scheduled speaker at the 2013 Noah conference in London, which takes place November 13th and 14th.

Wood points to a recent Adobe study in which 76% of marketers said their work has changed more in two years than in the past 50. "The rate of change is enormous," she says. "For brands, the challenge is to know which new technologies, which new devices, which new platforms to be responding to."

While Unruly may seem perfectly placed now, it wasn't that way in the beginning, the co-founders say. "We didn't really know what the idea was going to be," Wood recalls. "We just knew the social web was taking off. There was a massive opportunity to be part of that. Then the idea followed."

"Or several ideas," Button says, jumping in. "The first idea's often wrong. We launched a social media analytics product in 2006 and it was just way too early. We'd get a few paying customers but not enough to generate a business."

Unruly Media used its analytics data engine to tabulate the most-shared videos on their website. "The consumer-facing website was interesting enough, and had enough traction in terms of audience, that UK marketers would come to us and say, 'Can you put on my commercial campaign while we're here and give that some promotion?'"

But the chart's audience alone wasn't a strong enough proposition for marketers so Unruly aggregated a network of sites to help distribute content. "We started out with tens of sites and now we've got about 25,000 media partners," Button says, adding that the global audience is now a billion.

Alongside the distribution, marketers became interested anew in analytics. "We have predictive technology so we come in at all points in the life cycle," Wood says. "Our product, ShareRank, algorithmically predicts the success of a video before it's launched. When brands would come to us and say, 'What do you think? What should we do? What's our strategy?' It felt very anecdotal and is very hard to be tethered to any facts. So what we wanted to do was bring in data-driven creativity and data-driven consultancy."

ShareRank scores videos on more than 100 variables, testing emotional response, social motivation and special attributes. Based on the answers, it helps brands fine-tune content, or choose from several creative options.

With data from thousands of campaigns, Unruly distributes content to the corners of the web where it is most likely to be shared.

"This is really important because success happens much faster than it ever has," Wood says. "You fail or succeed within hours. It's really important for brands to be launching a campaign simultaneously with a big seed approach, gathering as many shares as possible in that first day because day two tends to be the sharing peak."

Unruly has grown to 135 employees with 10 offices around the world, generating £17.6 million in revenue last year. Demand is pulling the company to expand into Latin America and Asia-Pacific markets, Button says.

Mobile is a definite focus for the future, Wood says. "But in terms of talking about a product, it would be crazy for us to talk about a two-year-plan because everything will have changed again in two years."

T op 10 Most Shared Ads of 2013

Source: Unruly Media

Three of the most exciting Internet companies in Russia are run by women and all three chief executives spoke at NOAH, a conference in London on November 6th & 7th focused on late-stage Internet investment organized by Noah Advisors. Informilo interviewed the women about building big businesses in Russia.

It is not easy to stay ahead of the curve when you run the largest online retailer in Europe's biggest and fastest-growing Internet market. Just ask Maelle Gavet, the chief executive of Ozon, Russia's version of Amazon. Her mastery of this tough job has helped earn her a spot on the Forbes Global Women to Watch list.

Ozon posted sales of 8.87 billion rubles ($282 million) last year, an almost 80% jump from 2010. The growth rate has continued to soar, almost doubling in the second quarter to 7.1 billion rubles, not far from the figure that Ozon earned for all of 2011. The company, which doesn't release profitability figures, is well on track to reach its target of $1 billion within three years.

Index Ventures and other investors took part in a $100 million investment round last year, capital Gavet is using to help Ozon achieve its goal of covering 5,000 sales points in every city in Russia with more than 50,000 inhabitants.

The key to becoming more and more efficient is to fine-tune processes. "That is hard to deal with when you're growing quickly," says Gavet. "Say you want to implement next-day deliveries. If everything is stable, all people in place are people that have been working with you for five years and you lay out a plan. But if your business is growing as fast as we are, then half the people around the table you didn't have on staff a year ago."

Gavet says she has adjusted her processes for decision-making twice over the last 18 months and that she will have to change again soon to keep up with the company's growth. "What worked when you're a company of 100 people doesn't necessarily work when you're a company of 500 people," says the 34-year-old CEO. "It's very challenging to make decisions on something that is moving so quickly, but it's really exciting to be in such a demanding environment. You need a lot of drive, but I don't think I could work in a peaceful business."

Gavet left her native France and moved to Russia in 2001, launching Predstavitelskij Dom, an organizer of large corporate events. Two years later she went to work for Boston Consulting Group. After advising Ozon during her time at BCG she was offered a position as head of marketing in 2009 and told that she could become CEO if she did a good job. She obtained the top job a year later.

Gavet is the first to admit that staying on top is a continual struggle. "The most difficult thing, and what I find most exciting, is that you have to keep changing everything," says Gavet. "I thought, for example, we'd create the perfect website and then we'd be set, but I realized that you keep having to redo it in what is a never-ending process. You always have to change and adjust in a country like Russia and a business like e-commerce. It's exciting but exhausting."

Annelies van den Belt (pictured on Informilo's home page) knows how to manage media companies: she was the head of the broadband unit of Britain's largest free-to-air commercial broadcaster, ITV. She spent a year and a half as the director of digital media for British newspaper group the Telegraph and four years as director of new media for the Times, another British media group. She also was publisher of the Moscow Times and worked in executive roles at the Russia Business Review and the St. Petersburg Times.

Fluent in Russian and global in outlook, she was a natural choice to head up SUP Media, one of Russia's largest media companies, founded in Moscow in mid-2006 by American entrepreneur Andrew Paulson and Russian billionaire Alexander Mamut. Van den Belt got the call to build what was already a growing business and that is what she has done in the past four years with significant bumps in users and revenue. The company was profitable last year, the first time in its history, and is on track to repeat the feat this year.

SUP, based between Moscow, Kiev and San Francisco, owns Gazeta.ru, the online news service which has 8 million unique users per month, as well as several other popular sites including Russia's top blogging and social media platform Livejournal.com and popular Russian sports website Championat.com. The company, which is owned byMamut, Kommersant Publishing House and its management,derives its revenues from advertisements, and e-commerce.

"I've always felt incredibly comfortable in Russia because the country is full of energy and a lot of things can be achieved if you have the right frame of mind and mentality," says van den Belt, a native of Holland. "One of the reasons I think I do well in Russia is that I have lots of energy and I'm a glass half-full person. I love to build and there is still a lot to be built here. Russia is still so much the land of opportunity."

All markets are exciting, when it comes to reinventing media, because there is so much to do in the digital space, she says. "It's about spotting the opportunity in each market. That same mentality and skill set can be used in the UK, the Netherlands, Russia or wherever."

That said, she is quick to add that in general Russian companies are more dynamic than their counterparts in western countries. "When you do marketing in Russia you don't deal with agencies you have been working with for 25 years where the biggest thing on their agenda is the annual golf trip," she says. "If we introduce a new technology there is genuine excitement to try new stuff rather than say let's stay with what we had before. In digital media trying and testing are very strong elements. They are an important part of operations and of the strategic planning of the business."

There are challenges, though, when working in a country with a different culture and van den Belt says her Dutch-British humor based on joking with colleagues is not always understood.

"They are learning how to take me," she says. "You can't be 100% serious all the time; it's important to have a good time and have an outlet for pressure," she says. "I came here after eight years in the UK where you try to make fun of people you work with, because it helps when the pressure is high. I think the Russians understand me now because I'm still here."

Marina Treshchova has turned speed to market into an art form.

The CEO of incubator Fast Lane Ventures, Treshchova, along with partners Oskar Hartmann and Pascal Clement, is particularly adept at copying Western internet models and adapting them to the Russian market at an unprecedented clip. The incubator Treshchova heads has churned out more than 20 new Russian Internet start-ups in just a little over two years.

Fast Lane Ventures boasts that, on average, it takes 50 days to turn an idea into a fully operational business.

Some of those businesses have already found success, with Treshchova overseeing two significant exits for Fast Lane Ventures this year. The incubator sold sapato.ru, a Russian online shoe and accessory retailer that is similar to the U.S.'s Zappos, to Russian online retailer Ozon in February; shares in teleshopping channel Shopping Live were sold in April to Home Shopping Europe.

Other Fast Lane Ventures portfolio companies, which employ 800 people, cover online dating services, B2B sales, prepaid debit cards, healthcare media and online shopping.

Fast Lane Ventures has received more than $83 million in funding from Russian and international investors including Direct Group, e.ventures, Intel Capital, Mangrove Capital, UMJ Russia, Kinnevik and ru-Net. In its most recent round completed in April, Fast Lane Venturesreceived $18 million in funding from VTB Capital Venture Business and other investors. VTB may also in the future invest directly in some of the companies in Fast Lane Ventures' ample portfolio.

Treshchova, who worked for a U.S. telecom company for six years and earned a B.A. in business and finance from the University of Washington, says she is glad she came back to her native country. "Russia is a good place for women to do business," she says. If the job performances of Treschova,van den Belt and Gavet are an indication, that is very clearly the case.

There was standing room only at an Osaka conference on Octover 29th when eToro, an Israeli social investment network, demonstrated its service to bankers gathered from all over the world."The Internet has not really disrupted financial investing yet," says CEO Yoni Assia. eToro aims to do just that.

Some 1.75 million traders have placed more than 17 million trades through eToro's award-winning OpenBook and WebTrader platforms since January 2012. And the company is only getting started

eToro is one of a number of Israeli companies that are aiming for global dominance in their respective spaces. Israel has not built any big-tech companies since Amdocs and Checkpoint, but that may be changing.

Market observers say there are now many tech companies in Israel with $40 million to $60 million dollars in annual sales. "One of the problems was that in the past (Israeli start-ups) would all be sold off to large US corporations, but that trend may be changing," says Rubi Suliman, technology co-leader in the Tel Aviv offices of PricewaterhouseCoopers. He predicts that some of these companies will have initial public offerings. "We have close to 100 companies in that range - I don't think we have ever been in that position," he says. "Five or 10 could IPO and become world leaders."

Michael Eisenberg, a partner at Silicon Valley venture firm Benchmark Capital, agrees. "There is a cadre of entrepreneurs who want to go all the way and want to build world-beating companies out of Israel," he says. These include companies like eToro, Wix, Ironsource, Outbrain, Panaya and Gigya (see Informilo's Top 25 list).

Ironsource, which has raised $16 million from a local VC, has revenues of over $100 million. The company, which offers an installation platform that promises to increase completed installs, decrease download time, and improve the user install experience, is racking up some 100 million monthly installs, says CEO Arnon Harish.

Wix, a free publishing platform for websites, Facebook pages and mobile sites, is also reporting major traction. Over 20 million web sites and one million mobile sites have been built in Wix and the company says it is adding a million new users a month.

"We want to show that you can build a big company from Israel," says Avishai Abrahami, CEO of Wix, which has raised a total of $61 million of venture capital. Its investors include Insight Venture Partners, DAG ventures, Benchmark Capital, Bessemer Venture Partners and Mangrove Capital Partners "When you wake up in the morning and want to make a presentation, you turn to PowerPoint; when you want to build a document you turn to Microsoft Word. Our goal is that when you would like to build something around content for the web, you automatically go to Wix."

Abrahami says Wix has been approached about selling the company but he and the team have declined, preferring an initial public offering as an exit. "The timing will be our choice but it will be sooner rather than later," he says.

All of this spells good news for Israel. "The critical thing for Israel is for some entrepreneurs to build Facebooks and not just features," says Eisenberg.

"The Israeli venture funds have a habit of selling too early," he says. "The math only works if you get very big outcomes. To make up for lots of losses you have to have big outcomes so selling the good ones early is never a good idea."

If he and others are right the latest wave of Israeli companies will earn some really big returns for investors, helping the Start-up Nation earn an even more prominent position on the global innovation heat map.

When Melih Ödemis co-founded Turkish online food ordering company Yemeksepeti.com in 2001 there were plenty of skeptics. Even his best friend - an Internet savvy investor - told him not to do it. But Ödemis and his partners persisted and in September their bet paid off. General Atlantic, a global growth equity firm, invested $44 million in exchange for a minority stake.

There was no need to do a road show to raise the round. Some 20 U.S. and European VC and PE firms trekked to Istanbul to see Yemeksepeti.

It is a sign of the times. Emerging markets are now a big draw for both private equity and VC funds. And PE firms - until recently almost entirely absent from the Internet sector - are more comfortable making massive bets. The upshot? New players are attracting funding from new sources in new markets.

Questions around high valuations, difficulties with predicting Internet cash flows and competitive threats around technology disruption are less of a concern now than in the past, says Marco Rodzynek, a partner at Noah Advisors, the corporate finance firm behind NOAH, a conference focused on late-stage Internet investment taking place in London November 6th and 7th. "With the structural transition of eyeballs and shopping behavior from offline to online, we finally see a highly-awaited shift of the buyout funds to focus on online opportunities," says Rodzynek. "KKR, Permira, Hellman Friedman and many others want to bet on the right side of the medal when investing large equity checks."

Since bricks and mortar companies in emerging markets often don't have the expertise to develop turbo-charged digital companies, PE firms are increasingly writing checks to young entrepreneurs like Ödemis, who are jumping in to fill the gap, benefiting from first-mover advantage in fast-growing markets like Turkey and Russia.

Founded in 2001, when Ödemis was just 24 years-old, Yemeksepeti.com acts as a portal, bringing together consumers and restaurants, enabling consumers to order food online, with no extra charge. It makes its money by taking a cut from restaurants for orders placed. It has 1.5 million registered users across Turkey and the Middle East who submit over 50,000 orders daily.

The platform encompasses more than 6,500 restaurants including Burger King, Domino's Pizza, KFC, Little Caesars Pizza, McDonald's, Papa John's and Pizza Hut.

In addition to its core delivery restaurant marketplace, Yemeksepeti is developing new product offerings including a marketplace for grocery ordering, a restaurant reservation and review service, and a local delicacies ordering platform.

When Ödemis and his three co-founders - Nevzat Aydın (the company's CEO), Gökhan Akan and Cem Nüfusi, started the business there were only two million Internet users in a country of 70 million people. "We looked at what was happening in the U.S. and saw from day one the possibilities," says Ödemis, Yemeksepeti's CIO. Today there are an estimated 38 million Internet users in Turkey. Add in the Middle East - where Yemeksepeti is expanding - and the number jumps to 115 million. Less than half of the population in these countries is online so the potential to grow is huge.

Ödemis and his partners bootstrapped Yemeksepeti with $80,000 from friends and family. The business really started taking off after telecom operators began extending Internet services to the masses in 2005. In 2008 the company raised $3 million from the European Founders Fund, which was started by Germany's Samwer brothers.

For the latest round Yemeksepeti chose General Atlantic and Endeavor Catalyst, a philanthropic investment vehicle supporting high-impact entrepreneurs in global markets. The investment was General Atlantic's first in Turkey. PE firms are a better match for Yemeksepeti, because it needs growth capital to further build the business, not pressure to exit, says Ödemis. "The VCs bring up exits within the first five minutes of conversation," he says, while the PE firms are more patient and content with 3x to 5x returns.

Relations are not necessarily adversarial: In many cases PE firms are teaming up with venture capital firms to help high-growth Internet companies in emerging markets to scale. Take the case of Trendyol.com, a fast-growing Turkish on-line fashion site. Last May it attracted $26 million from venerable Silicon Valley venture firm Kleiner Perkins Caufield & Byers and existing PE investor Tiger Global to fuel continued growth. The investment was the first in Turkey for KPCB, an investor in Google, Amazon, Twitter and AOL.

While investments in Trendyol and Yemeksepeti highlight the unprecedented Internet and e-commerce growth market opportunities in Turkey, Russia, Europe's largest and fastest growing Internet market, is also proving a strong lure.

PE and VC firms have been pouring tens - and sometimes hundreds - of millions of dollars into companies such as Ozon, KupiVIP, Avito.ru, Wikimart and B2B Center.PE firm Baring Vostok Capital Partners, the largest shareholder in Ozon, for example, has raised a $1.5 billion fund in Russia to invest in local Internet projects, financial services and the resources industry.Baring Vostok's investments also include stakes in Yandex, Russia's most popular search engine, which raised $1.4 billion in an initial public offering on Nasdaq in 2011.

Private equity investors are focusing on the new generation of companies serving Russia's promising online consumer and business-to-business markets. With 50.8m internet users registered in September 2011, Russia has overtaken Germany as the largest internet market in Europe and a 2012 e-commerce report by EWDN.com is projecting that the Russian e-commerce market will be worth between $40 billion and $60 billion by 2020.

Private equity firms are not limiting their investments in Internet companies to emerging markets. They are increasingly active in western European Internet market as well. PE firms first starting investing in European Internet companies as far back as 2005 and were visible in two very high-profile deals: a $180 million investment by Summit Partners in French flash sales site vente-privee.com in 2007 and the acquisition of 70% of Skype by a group of investors led by Silverlake in 2010. And industry observers say the number of PE investments in European Internet companies is increasing. (See a few examples on page 18). This is partly because Internet companies are now considered to be more stable businesses but also because Europe is producing a greater number of successful fast-growing Internet companies. (See the story on pages 4 and 5.)

Take the case of General Atlantic, which opened its first European office in 1998 and has invested over €2.5 billion to support the growth of nearly three dozen European companies. Many of those deals involved bricks and mortar companies but recent investments include Axel Springer Digital Classifieds, an online classifieds business headquartered in Germany, and Sweden's Klarna, a pan-European e-commerce payment platform that has also attracted investment from VC firms such as Niklas Zennström's Atomico and Silicon Valley venture capital firm Sequoia Partners.

For its part, KKR announced in May that, in exchange for a 50% stake, it would make a $150 million growth equity investment in Fotolia, a European crowd-sourced market place for microstock images and video content. Some 145,000 professional and amateur photographers license their images via Fotolia, which was founded in October 2005 by Oleg Tscheltzoff and Thibaud Elziere. With over 17 million digital images and videos to choose from, Fotolia, which operates in 15 countries, offers one of the largest image databases for individuals, graphical professionals, SMEs and big corporates.

In addition to its investment, KKR, TA Associates and Fotolia's management worked with KKR Capital Markets, which acted as sole arranger, HSBC, Lloyds, GE Capital, IKB and Mizuho to put in place $150 million in senior financing for the company. NOAH Advisors represented Fotolia on the deal.

Although Fotolia, which raised growth investment from TA Associates in April 2009, is not raising new funds as part of the deal, the company said its new partners will help it to expand internationally, accelerate business development, and fund future acquisitions.

It is important to note that Europe's largest e-commerce fundraise for 2012 came from private equity group Vitruvian Partners, which invested $64 million in Just Eat, an online takeaway ordering service founded in Denmark and now based in the U.K. which is active on four continents and used by millions of consumers.

Alongside Vitruvian, existing backers Index Ventures, Greylock Partners and Redpoint Ventures also contributed to Just Eat's round, with Torch Partners advising. The three venture capital firms previously invested £30 million in March 2011, following Index's original investment of £10 million in 2009.

Just Eat says it plans to use money raised in the latest round to make acquisitions.

Yemeksepeti, which is in the same line of business, was founded around the same time, but don't try telling Ödemis that his company is Turkey's answer to Just Eat. "Just Eat is Europe's Yemeksepeti," he says with a smile. The Turkish company also has big expansion plan. If PE firms are right, both will soon become even bigger household names in a greater number of countries.

To identify the most promising fast-growing internet companies in Europe and Israel, Informilo asked some of the most active investors in the sector to nominate and evaluate 25 companies outside their own portfolios. Informilo's Top 25 are not necessarily the biggest or the the most senior companies in their respective sectors; they are the ones that are growing the most quickly. Many of these companies attended the NOAH conference in London. Read on to see who's on the list.

alfresco

(www.alfresco.com)

London, england

What it does: Open-source enterprise content management platform.

Why it's hot: Claims to be the second-largest open-source player in the market, after Red Hat, with 5.6 million users spread across 161,000 companies. 2011 revenues were just under $100 million in revenues, and the company is considering an IPO in 2013 (if not before). It raised $20 million in venture funding from Accel, Mayfield and SAP Ventures in 2008. Recently launched The Alfresco Cloud, which hopes to take some market share from Dropbox and Box.net. Alfresco was founded by Documentum Co-founder John Newton and former COO of Business Objects John Powell.

Showroomprive

(www. Showroomprive.com)

La Plaine Saint-Denis, France

What it does: Online shopping club.

Why it's hot: One of Europe's largest private member e-commerce websites, selling heavily discounted designer fashion and homewares across Europe. In 2010 Accel Partners invested €37 million. In 2011 revenues were €130 million; it now has approximately 15 million users. The company is expanding quickly, and the site is growing at 200,000 new members a month.

king.com

(www.king.com)

london, england

What it does: Free online games.

Why it's hot: King.com offers over 150 exclusive games in 14 languages through its website, mobile devices, Google+, and Facebook, where it is a top 10 Facebook developer, and the second most popular game provider, with more than 11 million daily active users. Overall, its games are played by 40 million players more than 3 billion times each month. Planning an IPO on Nasdaq next year.

Badoo

(www.badoo.com)

London, England

What it does: Social network "for meeting new people."

Why it's hot: Has 164 million members in 180 countries; more than 100,000 new members join every day. Currently available in 40 languages via Badoo.com and various social/mobile platforms as an iPhone, Android, Facebook & Desktop application. More than 5 million adults visit Badoo daily and millions more come more often, each spending well above average time on the site. It is rumored to be considering an IPO on Nasdaq.

JustEat

(www.just-eat.com)

London, England

What it does: Online takeaway ordering service.

Why it's hot: Active on four continents with more than 20,000 restaurants on its network; used by millions of takeaway customers every month. Raised $64 million from private equity group Vitruvian Partners and other investors in May to support acquisitions of smaller rivals, Europe's largest e-commerce fundraise for 2012. Claims that less than 10% of all takeaway orders in the world take place online, so there is still plenty of growth out there.

Tradeshift

(www.tradeshift.com)

London, England

What it does: A fee-free platform for e-billing and payments.

Why it's hot: With a growth rate of 60% a month, this Danish-born venture recently raised $7 million to expand the business. It is now active in 190 countries; customers include the EU's new procurement platform, as well as the UK's National Health Service.

wonga

(WWW.wonga.COM)

london, uk

What it does: Digital, real-time short-term loans for consumers and businesses.

Why it's hot: Wonga's technology platform allows it to make swift credit decisions, yet maintain positive cash flow with very tight lending restrictions (in 2011 revenue exceeded £73 million and profits were £16.6 million). Recently named the number one company in the Sunday Times Tech Track 100. Allegedly considering a stock market float in the US as early as next year which could value the company above £1 billion.

Criteo

(WWW.criteo.COM)

Paris, France

What it does: A leader in performance display advertising.

Why it's hot: Profitable since 2009, but still raised a EU30 million round of funding in September, led by SoftBank Capital. The company was a beta partner of the Facebook Exchange, which lets Criteo tap into inventory that accounted for 28% of total U.S. online ad impressions last year. Its 3,000 advertisers in 39 countries are mainly in retail, travel and classified categories, but the firm is working on a "top-of-funnel CPC product" that would appeal to auto, finance and telecom brands. Also allegedly being considered for acquisition by Yahoo.

Rovio

(www.Rovio.com)

Espoo, Finland

What it does: Developer of casual games across multiple platforms - iOS, Android, Windows Phone, OSX, Windows, Facebook.

Why it's hot: Angry Birds, Rovio's breakthrough game, hasn't just made it on to multiple platforms - it's now part of the collective consciousness. Launched in December 2009, the game has been downloaded more than 500m times and has spawned real-world stores to sell fluffy versions of its grumpy avians and pigs as well as apparel. Last year Rovio scored a $42m funding round; CEO Mikael Hed hasn't ruled out more funding before an IPO.

Shazam

(www.shazam.com)

London, UK

What it does: Mobile app to identify music.

Why it's hot: Bar-goers have since 2002 been holding their handsets up to speakers so the Shazam app can identify the music they're listening to. Since then it has morphed into a powerful marketing tool: the user can now not only to identify the music in, say, an ad, but also buy the goods featured in the ad, concert tickets, the track itself, etc. In June 2011 it raised $32 million in funding. It boasts 250 million users, adds two million new users a week, and claims to have identified more than five billion songs. Now it is expanding onto second screens, making TV ads "Shazamable," allowing its large user base to buy not just music but all sorts of merchandise connected with programming.

Mind Candy

(WWW.mindcandy.COM)

London, UK

What it does:Creator of Moshi Monsters, an online world for kids.

Why it's hot: Founded in 2004 by Michael Acton Smith, a UK-based entrepreneur who previously founded Firebox.com. Over 65 million kids have joined the site online and Moshi is now expanding successfully offline into books, magazines, trading cards, toys, videos games, music, mobile apps, and cartoons. Moshi Magazine launched in February 2011 and is now the largest UK kids title in the UK. In March the company signed a major partnership deal with Sony Music.

Nordeus

(WWW.nordeus.COM)

Belgrade, Serbia

What it does: European social game developer.

Why it's hot: Nordeus's game, Top Eleven, is the most-played online sports game in the world, with more than 6 million monthly and 2 million daily users on web, Android and iOS devices. Won the People's Choice Award for best start-up at London Web Summit 2012.

Supercell

(WWW.supercell.NET)

Helsinki, finland

What it does: Real-time social gaming developer.

Why it's hot: Since pivoting to become a "tablet-first" publisher the company has released two games: Hay Market and Clash of Clans; one is a global hit; the other a blockbuster. The company is now generating revenues of $500,000 a day.

klarna

(WWW.klarna.COM)

stockholm, sweden

What it does: Seeks to provide a zero-friction online payment solution that allows consumers and merchants to interact with each other safely and simply.

Why it's hot: Klarna lets the consumer receive the goods first and pay afterwards, while the company assumes the credit and fraud risks for the merchants. Klarna is one of Europe's fastest-growing companies; in the past even years it has grown to 700 employees operating in seven European countries with over seven million consumers.

Spotify

(www.spotify.com)

Stockholm, Sweden

What it does: Streaming music service with close social media interactivity and mobile apps.

Why it's hot: Allows users to stream music from the big music players and smaller independent labels using either a free, ad-supported service or a premium ad-free service. Now requires a Facebook account, so has enormous potential reach; recently declared itself a "platform," encouraging developers to write apps for it. Users can share playlists, driving social crowdsourcing for events big and small; premium users can also access and share music on most mobile devices.

Soundcloud

(www.soundcloud.com)

Berlin, Germany

What it does: Social sound platform where anyone can create sounds and share them.

Why it's hot: SoundCloud allows sound creators to instantly record or upload original audio content, embed sound across websites and blogs, share publicly and privately, receive detailed analytics, plus get feedback from the community directly onto the waveform. Has signed up more than 15 million "sound creators." In January raised an undisclosed amount in a round led by Kleiner Perkins Caufield & Byers. GGV Capital also participated. The investment will allow SoundCloud to continue to expand more rapidly.

etoro

(www.etoro.com)

Tortola, British Virgin Islands

What it does: Social investment network.

Why it's hot: 1.75 million traders have placed more than 17 million trades through eToro's award-winning OpenBook and WebTrader platforms since January 2012. Traders can learn from each other, share live trading information and use their collective trading power. Received Best of Show at FinovateFall for its Social Trading Index, which enables traders to create their own indices and make them available to the eToro investment network.

Outbrain

(www.outbrain.com)

New York, NY, USA

What it does: Content discovery platform.

Why it's hot:"Content marketing" - creating and sharing content to engage current and potential consumer bases - is gaining traction. Outbrain is well-positioned for a shift to a greater emphasis on content; its installed on more than 90,000 blogs and websites. American Express, Proctor & Gamble, GE and General Mills use it as part of their marketing strategy to reach target audiences.

Wix

(www.wix.com)

Tel Aviv, Israel

What it does: Free publishing platform for websites, Facebook pages and mobile sites.

Why it's hot: Raised $58.5 million in funding in four rounds since 2007. Has some 27 million users; over 20 million web sites have been built using Wix and more than one million mobile sites. The company claims to be adding a million new users a month. Last year it launched "FB eStore," which allows companies to take payments, via PayPal, directly on their Facebook fan pages. Some surveys say 40% of small businesses use Facebook as their sole marketing channel, giving Wix a good market to grow into.

WAZE

(www.waze.com)

palo alto, ca, usA

What it does: Free navigation and traffic service that creates "local driving communities that work together to improve the quality of everyone's daily driving."

Why it's hot: Has a community of 13 million global "traffic resisters" who keep users informed about road conditions in real time. In February Waze integrated Foursquare and Yelp points of interest into the service. Consistently the number one navigation app in the Android Marketplace.

conduit

(www.conduit.com)

foster city, ca, us

What it does: Cloud-based tools to help web and mobile publishers engage their audience.

Why it's hot: More than 260,000 publishers and 250 million end users in 120 countries use Conduit tools, including Major League Baseball, Time Warner Cable, Chelsea Football Club, Groupon, and Fox News. In April, Conduit was valued at $1.3 billion when investor Yozma Venture Capital sold its stake and J.P. Morgan's fund bought 7% of the company for $100 million.

Viber

(www.viber.com)

Limassol, Cyprus

What it does: Free text, calling, photo messages and location-sharing with other Viber users.

Why it's hot: Founded by American-Israeli entrepreneur Talmon Marco, Viber is growing fast: it had more than 100 million users as of September, up from 65 million in July. It's available on a range of platforms, and in 10 languages. Disrupting mobile operators and the previous generation of disruptors, such as Skype.

kenshoo

(www.kenshoo.com)

tel aviv, israel

What it does: Digital marketing software focused on search marketing and online advertising.

Why it's hot:$25 billion+ in annual client sales revenue is directed through Kenshoo, which has campaigns running in more than 190 countries with clients including Expedia, Facebook, Hitwise, Omnicom, Travelocity, and Zappos. Backed by Sequoia Capital and Arts Alliance, the company delivers 1 billion+ Facebook ads and 1.5 billion+ SEM impressions a day. A market leader with a solid position in a growth market.

gigya

(www.gigya.com)

palo alto, ca, us

What it does: Offers online businesses social infrastructure to integrate social network functionality throughout their web properties.

Why it's hot: Works with more than 600 enterprises, including 44 of the top 100 websites. Gigya finished Q3 2012 with record growth in key metrics; the company is on track to triple 2011 revenue after seven consecutive quarters of double-digit sales growth. After securing an additional $15.3 million in funding in June, the company has scaled rapidly. Social infrastructure has become a requirement for online businesses; Gigya's approach of offering everything a site needs to be social puts it in a good position for future growth.

PANAYA

(www.panayainc.com)

menlo Park, ca, usA

What it does: Cloud-based solution to make ERP systems easy to install, use, upgrade, and maintain.

Why it's hot: Panaya's software-as-a-service helps companies that use SAP or Oracle to reduce 80% of their upgrade and testing risk and effort. Used on 2,500 ERP systems among 500 customers in 54 countries. Management team are all seasoned professionals with 15+ years experience in the tech sector.

Outfittery, a Berlin-based personal online shopping service for men that is creating lots of buzz in the market, aims to win over reluctant male shoppers. Its tagline? "We take the pain out of shopping."

The male shopper fills out an online questionnaire that is followed up with a phone call from his "personal stylist." After that chat, the stylist mails the customer two to three outfits of "high-quality casual wear" from brands that include Tommy Hilfiger, Gant and Levi's, with a hand-written letter. Anna Alex, co-founder and co-managing director of Outfittery,(pictured on Informilo's home page) calls it the "love letter." No shipping fee is added to the cost of the clothing. The customer keeps what he wants and sends back the rest at no extra charge.

If the customer needs something new later he can reach out to his stylist, who will also be in touch from time to time. There is no subscription or minimum amount that must be bought. The service is available in Germany, Austria and Switzerland (the website is only in German) with plans to expand to other European countries, including the UK, in the next year.

The company earlier this year raised a reported $1.1 million from Mangrove Capital Partners, RI Digital Ventures, Investitionsbank Berlinwith existing investors Holtzbrinck Venturesand High-Tech Gründerfonds also participating in the round. Maybe it is because venture capitalists, who are mostly male and always pressed for time, recognize the service as solving a valid pain point. "Many of our investors are also customers and we think that is a very good sign," says Alex, who is in charge of product and operations. The company is scaling fast, "so we are just at the point where we could make use of television advertising."

At the NOAH Conference, an annual event in London which this year is expected to attract around 2,000 people, the Berlin-based start-up and six others got the chance to pitch in front of seven judges. The prize? A share of €7 million in free television advertising in Germany.

SevenVentures Pitch Day, sponsored by SevenVentures, the venture arm of ProSiebenSat.1 Media, is directed at start-ups that want to expand in Germany; it will be held on November 14th. The first-place winner will receive €4 million in advertising time on the channels owned by ProSiebenSat.1 Media; second prize is €2 million in advertising, with €1 million going to the start-up in third-place. This is the second year the pitch event has been held at NOAH Conference.

"Last year the jury members gave the start-ups a hard time with lots of difficult questions about their business plans and growth prospects and we expect it to be the same this year," says Thomas Offner, a senior investment manager at SevenVentures and the founder of several start-ups.

Each of the seven start-upsl showed a short video and then will be grilled by the six industry experts on the jury. The contest was broadcast live online with the audience functioning as a seventh judge; the audience voted through an app, on the SevenVentures Pitch Day Facebook page or on the SevenVentures website. The company that got the most votes from the public won a separate prize - a €30,000 package of consulting services including public relations.

This year's jurors were: Philipp Freise, a partner at KKR and the head of the firm's European Media Industry team; Philippe Botteri a partner at Accel Partners; Rainer Maerkle, a partner at Holtzbrinck Ventures; and three well-known serial entrepreneurs turned investors: Christophe Maire, Brent Hoberman and Fabrice Grinda.

The seven finalists were chosen from among almost 300 applicants. Read on to find out more about contestants Azimo, checkrobin.com, EYEGLASS24, GetYourGuide, tado and mygola.

One-year old Azimo, the third place winner at NOAH, allows people to send money abroad via its website or a smartphone app (for iOS and Android) at prices that undercut more traditional ways to send money.

Sending £500 from Britain to South Africa would cost £40 at a Barclays branch, £25.90 through Western Union and £5 with Azimo, says Michael Kent, CEO and founder of Azimo. (The actual cost using Barclays and Western Union will depend on several factors and could actually be much less.) Azimo keeps its fee down by not having any physical shops.

London-based Azimo has raised just over £1 million and Kent, who will be making the company pitch at the SevenVentures contest, says the company is looking for further investment so it can scale up its activities. The company spends "a six-figure sum" annually on advertising with most of that directed to digital media, though Kent says the company has recently begun to test using traditional media such as television.

Building name recognition will be particularly important for Azimo, which is operating in a crowded field that includes traditional banks such as Barclays with its Pingit service.

If checkrobin.com has its way, there will be fewer cars with half-empty trunks travelling around Europe and a little less carbon dioxide in the air.

Vienna-based checkrobin.comis an online platform that matches those on the move in their car with people who need to ship something quickly. The two sides agree on the main terms through the company's website with final details discussed either on the phone or with text messages. The driver can earn as much as €30 with checkrobin.com getting a commission and providing insurance for the shipped items.

"Until checkrobin.com it was almost impossible, or at least uneconomical, to realize same-day delivery outside urban areas," says Hannes Jagerhofer, the company's CEO and co-founder. "Using commuters to facilitate the transport, our platform is able to change this and by that, tap into a new, highly-attractive market."

checkrobin.com, which is a year old and has so far been funded exclusively by Jagerhofer and his two co-founders, offers its service only in Austria, although it plans to expand into Germany next year. Winning a portion of the SevenVentures prize would help provide the funds to build name recognition as part of that expansion.

"Our product has the potential to change an entire industry by providing simple, flexible and reliable same-day delivery while benefiting the environment," says Jagerhofer, checkrobin.com 's pitchman at the SevenVentures Pitch Day.

Munich-based EYEGLASS24, winner of the People's Choice award at NOAH, sells Swiss-made lenses for eyeglasses online and through the post.

Customers pick out their lenses at EYEGLASS24's website, send in their new or old eyeglass frames and then get them back with the new lenses, usually in a few days. The savings can be as much as 80% compared with a traditional optician, says Jascha Chong Luna, CEO and founder of EYEGLASS24 and the person tasked with making the company's case in front of the jurors.

"We combine two strong markets - the increasing e-commerce-market and the market of 40 million Germans with glasses," says Luna, who estimates that more than 15,000 people get new eyeglasses every day in Germany. "Our business model corresponds to the German zeitgeist of repairing instead of consuming and buying anew."

EYEGLASS24 just closed its first round of financing (Luna would not give details). Germany is also home to Mister Spex, a German e-commerce site specialized in the sale of glasses, sunglasses and contact lenses which earlier this year raised €16 million in private equity funding. EYEGLASS24's differentiator is it only replaces the lenses and does not sell frames.

GetYourGuide, the first prize winner of the contest at NOAH, lets the users of its website and app (for iOS and Android) book guided tours, diving lessons, cooking classes, canal cruises and any number of other activities, allowing them to avoid sellouts, lines and the need to pay in cash upon arrival. The company promises users they will pay the best local prices and pledges to refund the difference if a cheaper price is found.

Zurich-based GetYourGuide sells tickets for attractions across the globe charging suppliers - which include travel agents, hotels and tourism boards - a commission. It has a multi-million-euro budget for paid search, but has not yet invested in other channels such as television.

"Over the past two years we have built a significant consumer base by investing heavily in search engine marketing and we now believe it is time to make the next step and start building a brand in Germany, our key territory," says Johannes Reck, CEO and co-founder of GetYourGuide, who will argue the company's case on November 14. "The SevenVentures prize would be a fantastic opportunity to start doing so."

GetYourGuide, founded in 2008, has received more than $16 million in funding, including $14 million at the beginning of this year from Spark Capital and Highland Capital Partners Europe.

Munich-based tado°, a system for controlling heating remotely through a smartphone app for iOS and Android, claims to save typical families about 25% on their yearly heating bills, ended up winning second prize at NOAH.

The app is free, but to get started users must buy the small box that controls home heating for €299 or rent it for €8.25 a month. The box connects to the heating system and communicates with the smartphone, which sends information, including the user's whereabouts, using the phone's GPS.

The company has raised $4 million in capital from Target Partners and Shortcut Ventures including $2 million in September. The next fundraising process will begin at the end of the first quarter next year, says Chief Marketing Officer Leopold von Bismarck.

"Gola" means circle, or the world, in Hindi and "my gola" aims to give you the power to see the world the way you wish, says Anshuman Bapna, mygola's CEO, co-founder and SevenVentures pitchman.

Mygola, in fact, has raised $2.6 million, including $1.5 million last month, with a business plan based on helping people see the world. The company has a huge database of itineraries gathered from newspapers and guidebooks that it calls on to help users come up with their own customizable vacation plan. The site, which covers more than 20,000 destinations around the world, then helps by making bookings.

Winning a slice of the SevenVentures prize would help mygola grow in Europe, says Bapna, who has an MBA from Stanford, co-founded and sold his first start-up while studying as an undergrad in Bombay, and spent time working on Google's strategic partnerships team.

"It's no surprise that Europe is our most popular destination, however Europe, particularly Germany, is also turning out to be one of the largest sources of travelers for us," says Bapna. "As a company that straddles U.S. and India, we've managed to cobble together a good user base and partnerships in North American and Asia. However, we're still struggling with making our presence felt in Europe."

The $5,000 mygola budgets each month for advertising is unlikely to change that, but a victory at NOAH just might.