The startup market is having a moment around the world, but few regions can brag as much as Europe when it comes to venture capital investment. Yes, the United States is putting up impressive numbers and Indian startups are booming. But Europe is such a bright spot in the larger world of private startup investment that it deserves more solo attention.
The data coming out of the continent is staggering: According to a Dealroom report, some €49 billion was raised by European startups in the first six months of 2021. That’s 2.9x as much as was raised by the region’s technology upstarts in the first half of 2020 and easily crests previous full-year records set in 2020 and 2019.The Exchange explores startups, markets and money.
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The epic start to 2021 for European startup fundraising crushes any preceding year that The Exchange has data for, erasing concerns that the continent simply won’t be able to create breakout tech companies that compete globally. There are other signals that things are red-hot in Europe, including the recent direct listing of Wise on the London Stock Exchange. The company was valued at a huge $11 billion price when it did so. Rapid investment and big exits are now the norm out of Europe. Naturally, we wanted to learn more about where venture dollars may point in the future. What follows is a synthesis of market data and notes from Diana Koziarska, a partner at SMOK Ventures; Vinoth Jayakumar, a partner at Draper Esprit; Simon Schmincke, a partner at Creandum; and Javier Santiso, a partner at Mundi Ventures. The picture that emerges is one of sustained optimism, an expectation that venture investment is going to blast through traditional lulls and sustain a rapid-fire cadence during the rest of 2021. Records shall be smashed. But inside the various superlatives, a few sectors may do better than others. And Europe’s comparative gains in the venture capital world aren’t without impacts. Let’s explore what data says about the first half of 2021 in Europe’s startup market, and what its in-crowd expects for the rest of the year.