If you buy something using links in our stories, we may earn a commission. This helps support our journalism. Learn more. Please also consider subscribing to WIRED
This article was taken from the November 2013 issue of Wired magazine. Be the first to read Wired's articles in print before they're posted online, and get your hands on loads of additional content by subscribing online.
For the third year, WIRED's editors have visited the continent's startup hubs to identify the ten tech cities you need to know about. Our conclusion: Europe is on a roll. Here are the 100 companies causing the greatest buzz, according to the local commentators, investors and entrepreneurs we surveyed.
ISTANBUL
Istanbul's startup sector, known as the Digital Bosphorus, enjoyed a significant high in 2011, with some clear winners emerging - from e-commerce giants Trendyol and Lidyana to gaming group Peak Games. However, as Istanbul comes of age, there have been growth pains within its thriving startup community and 2012 marked the first failures. The German company Rocket Internet, which has a portfolio of over 100 companies, shut several e-commerce sites 15 months after entering the Turkish market, and several high-profile local startups, including Pabbuc.com and Gurunzi.com, also closed their operations.
In the eyes of Ali Karabey, MD of 212 Ltd, one of Turkey's leading early-stage venture-capital funds, these closures aren't detrimental to Istanbul's business hopes, but are a vital part of establishing a more mature startup environment. "The biggest battle currently faced by the Turkish entrepreneur is that they're still scared of failing," explains Karabey, 37. "Even very successful people don't seem to talk about how hard their journey was, or how many times they failed. Entrepreneurs are only just starting to get to grips with the fact that failure is OK, so long as you learn something and apply it to your next venture."
Along with this shifting attitude to failure, Istanbul's successes have encouraged younger generations to seek entrepreneurial success, resulting in strong software and gaming sectors emerging in a city best known for e-commerce. Venture capital is also emerging. "For the best and brightest talent in Turkey, entrepreneurship and startups are now a viable career option," says Cem Sertoglu, 41, partner of Earlybird Venture Capital. "This wasn't the case two or three years ago." Here are ten startups that pay tribute to Istanbul's coming of age.
1. Karnaval
Büyükdere Caddesi, CEM Business Centre 23/4
In 2011, Spectrum Medya, the largest radio broadcaster in Turkey with five FM stations, was facing a dangerous decline in advertising share. "Much the same as in other countries - but perhaps more precipitously in Turkey - the radio market was in decline," explains Spectrum Media CEO Ali A Abhary, 41. Spending had fallen "from six per cent of ad dollars just seven years ago to only three per cent".
As listeners tuned out, Spectrum - wholly owned by the Actera Group, one of the largest private-equity firms in Turkey - sought to become the first Turkish radio group to develop a significant online presence with an in-house startup, Karnaval.com. Launched in early 2012, Karnaval.com is a multi-platform digital radio service, offering two listening experiences: 13 digital stations target major music genres, hosted by their own DJs, providing news, sport and local content that, according to Abhary, "makes a radio station
'radio' rather than a playlist generator". In addition, listeners can create their own station experience with a crowdsourced music service powered by Silicon Valley startup Jelli. Users vote for tracks, which in turn influences the group's FM playlists.
The service also allows listeners to browse band biographies and purchase gig tickets via a partnership with Ticketmaster.
Karnaval.com operates a business model Abhary claims is unique for Turkey, in which advertisers can buy ads that target specific demographics, geographies or devices, a significant upgrade from "analogue" radio spots.
More than six million unique users visited the site in March. In January, ratings group Triton Digital ranked Karnaval.com as the largest online music service in Turkey and the 14th largest in the world.
2. Krombera
Levent Mahallesi, Güvercin Sokak 29
Krombera, founded in March 2011 by Alper Ozdemir, 28, and Hakan Bas, 29 (whose e-commerce site Lidyana appeared in last year's list), is a digital agency offering marketing services from website and app creation to augmented-reality projects. Krombera was awarded Preferred Marketing Developer status by Facebook within its first ten months and has gone on to create more than 200 Facebook applications for clients. Its Toolbera platform, launched in 2012, allows companies to rent apps for Facebook, Twitter, Instagram and Kinect that can be tailored to specific marketing needs. Revenue rose from $1.5 million (£920,000) in 2011 to $3 million (£1.8 million) in 2012.
3. Cloudarena
Bagdat Caddesi 458/6, Suadiye
CloudArena's HotelRunner software allows offline hotels to gain an online presence with a mobile site, website and Facebook page. Additional services can then be purchased, such as online reports. A seed investment of $500,000 (£308,000) in April 2012 from 212 Capital Partners and a $210,000 (£129,000) grant in July 2012 from TUBITAK allowed it to launch a public beta of HotelRunner in November 2012. It now operates in more than 80 cities around the world, with over 1,200 registered properties.
Ones to watch
4. Markafoni
Ertuğrul Gazi Caddesi 4
Markafoni is market leader in Turkey's fashion sector, and the second-largest member site for fashion in the world. CEO Sina Afra claims his firm was the first Turkish web company to go global. It hasn't been smooth: it has closed in Korea. Markafoni had 18 million visits each month in 2012 and sold 700,000 items every four weeks.
5. Youlike.com
Eski Üsküdar Caddesi 10/7
Having founded news site Uzmantv and social hangout Itiraf, YouLike's creator Ersan Özer, 44, is well versed in Turkey's online habits. Launched in February, YouLike is a dating site that factors users' mutual likes, and also dislikes. With 20,000 members in Turkey, the UK and the US, it's expanding after a funding round.
6. Idemama.com
Maslak Mahallesi, Bilim Sokak, Sun Plaza
With 20 years' advertising experience between them, Rahsan Tan, 38, and Leslie Kandiyoti Mori, 34, were well placed to provide Turkey's two million SMEs with design-crowdsourcing platform Idemama.com. "We see potential in the growth of Turkish SMEs," says co-CEO Mori.
7. Yemek Sepeti
Bestekar Şevki Bey Sokak 16-18
Yemek Sepeti is Turkey's biggest online food-ordering service, linking 7,500 restaurants to 1.9 million registered users. Founded in 2001, the company has recently moved into vertical projects such as Papyon.com, which collates information the company holds on restaurants.
8. Clover Game Studio
Danış Park B4, Maltepe
Established by three computer-engineering graduates, Clover Game Studio's first mobile title, Reveal The Maze, received over a million downloads in its first month and claimed the prestigious number-one spot on Apple's App Store in over 50 countries. The trio are currently working on their second game, Candy Chain.
9. Solvoyo
ARI 2 Teknokent ITU Ayazaga Kampusu
Established in 2005, Solvoyo took five years to develop its supply-chain-planning software, planLM, which incorporates cloud computing into supply-chain decision making. Its flagship SaaS offering, Solvoyo Elevation Platform, was snapped up by international companies such as HP, Applied Materials and Vestel.
10. Vivense
Beyazgül Caddesi 32, Arnavutköy
Kemal Erol, 33, a former management consultant, founded Vivense, an online furniture store, in March. Customers can browse over 5,000 discounted items and access expertise from a network of interior designers. With no showrooms, it organises delivery from the manufacturer directly to the customer.
EUROPES OTHER HOTTEST STARTUP CAPITALSLondon
PREVIOUS YEARS
WIRED's 2012 European startup guide
WIRED's 2011 European startup guide
This article was originally published by WIRED UK
