According to industry data, Turkey’s entrepreneurial system managed to raise a total of $587 million in investments through 235 deals at the seed, early and late venture capital stages in the first half of this year.
Of those, 53 were made in the second quarter, bringing in $476 million in revenue, according to Startup Watch data released at an event this week. Excluding a deal by fast-delivery pioneer Getir, $337 million was invested in the first six months.
Compared to pre-pandemic periods, deal size in the first half of 2024 was 417% higher than in all of 2019, even excluding the Getir deal, which brought in $250 million.
The BiGG Fund of the Turkish National Institute of Science and Technology (TÜBITAK), previously a grant and now a pre-seed fund, has once again proven its leading role in the ecosystem.
This fund alone funded 136 of the 142 seed investments made between January and June, according to data from startups.watch.
At the later stage, continued investments have helped financial technology startups set new records, demonstrating the significant impact TÜBITAK and fintech startups are having on the ecosystem.
The TÜBITAK BiGG fund supports startups in sectors such as biotechnology, health technology and electronics. The fund helped Turkey rank second in Europe for seed investments in the first half of 2024.
The total investment volume in the first six months highlights the dynamism of the startup ecosystem. TÜBITAK BiGG Fund provides crucial support to startups, especially at the seed stage.
The impact of fintech
Fintech startups have managed to attract record amounts of investment, and the financial technology sector is building on the momentum it has gained by continuing to grow by attracting large capital inflows and making international acquisitions.
In the first half of 2024, companies such as Colendi, Dgpays, Midas and Sipay received investments of over $15 million.
The major investment brings the total capital raised by fintech startups from January to June to $181.5 million across 13 deals, as the sector continues to grow through domestic and international acquisitions.
For example, Papara acquired Pakistan-based SadaPay, and iyzico acquired Paynet. This growth has established the fintech sector as a major player in Turkey’s startup ecosystem.
In the first half of the year, 66 of the 235 investments involved female entrepreneurs, reaching 28 percent, the highest in five years, demonstrating growing support for women entrepreneurs.
Seed-funded startups
In Turkey, only 3.4% of startups that secure seed funding successfully raise Series A funding, compared to 15.8% in the UK and 21% in Germany.
Of the 235 investments made in the first half of the year, only 12 involved foreign investors, indicating low international interest.
The number of crowdfunding campaigns continued to decline in Q2. Apart from economic factors, lack of proper investment, non-existence of returns and poor reputation management are likely contributing factors to this decline. This indicates that alternative fundraising methods are not being effectively utilized.
Investing in Spyke Games
Colendi, Dgpays, Midas and Sipay received over $15 million each, marking record investment in fintech.
According to the data, artificial intelligence (AI) was the area with the highest number of investments in the first half of 2024.
Turkey ranks second in Europe in terms of gaming investment amount and number of deals, behind the UK.
Spyke Games has raised $50 million in the first half of 2024, making it the second most funded gaming startup in Europe.
The number of approved venture capital investment funds (VCIFs) has reached 380, of which 15 are inactive. More than half of these funds were established after 2022.
As of the end of the first half of 2024, there were 85 active corporate venture capital funds (CVCs) in Turkey.
