Deal in focus: Hoxton and DFJ in Campanja series-A round

Angel investors also participating in the round were Ram Shriram – one of the first investors in Google and a board member – and MySQL co-founder David Axmark. This deal marks the first time that Shriram has invested in Europe.

Founded in Stockholm in 2010 by Marcus Anzengruber and Berner Setterwall, Campanja uses big data and real-time bidding solutions to improve search engine marketing results. The platform allows customers to optimise advertising spend in real-time, adjusting for location, time and seasonality.

Going global
The Stockholm-headquartered start-up recently opened an office in Palo Alto, and clients include customers in the US, Europe and the Middle East. Campanja has 44 employees – the majority of whom are in the R&D team – and forecasts revenue growth of around 300% in 2014.

The fresh capital will be used for developing the platform, hiring staff in Palo Alto and Stockholm, and for the start-up's international expansion with the opening of new offices in London and New York. DFJ aims to assist with the US expansion by leveraging its local links. The plan is to keep engineering operations and some sales offices in Stockholm, while increasing sale operations in California where the CEO is based.

Hoxton founding partner Rob Kniaz led a seed round of around $1m in the company two years ago. DFJ Esprit partner Scott Sage met founder Marcus Anzengruber three years prior to the deal, before the company was called Campanja. The parties agreed to go ahead with the deal in November and closed it in December, while getting more staff on board until announcing it in February. The deal took slightly over a month to complete (excluding legal paperwork), as the venture investors preferred to move swiftly so the founder could focus on developing the start-up rather than negotiating with investors.

The investors were attracted to the engineering background of the company's highly skilled tech specialists – mainly ex-hackers. These developers use a complex coding language called Erlang, notably used by hedge funds for high-frequency trading and massively parallel individual calculations, developed by Ericsson in the 1980s.

Nordic draw
Regional consideration also played a part, says Kniaz: "Nordic start-ups think globally from the start and operate in English. Most European companies start in their local market and expand from there, but there's no reason to start small. We were attracted by Anzengruber's hunger and ambition to build a $1bn company, global from day one."

The ad tech sector has also experienced a comfortable 20% growth rate per year. According to Sage: "When marketing-savvy firms evolve into companies that can measure data, it allows advertisers and directors to use super granular data driving real value. We expect it to be used at the boardroom level."

The sector has seen several successful listing candidates recently. California-based real-time ad platform Rocketfuel is nearing a $1bn valuation ahead of its IPO while French online ad company Criteo raised $250m when it listed in October last year, fuelling the ad tech IPO momentum further. Founded in Paris in 2005, Criteo counts travel website Expedia, computer maker Lenovo and Macy's among its clients. But Kniaz believes there is plenty of room for more players on the market: "The best thing about the display advertising market is that it has room for many competitors, there isn't only one winner."

Founded by Hussein Kanji and Rob Kniaz, London-based VC firm Hoxton held a first close for its maiden fund on $40m in December last year. This is its third investment following Tizaro and Llustre.

People
Hoxton Ventures – Rob Kniaz
DFJ Esprit – Scott Sage

This deal was originally covered on 13 February 2014

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