There’s never been a better time to launch or scale a startup in Europe: digital adoption is accelerating, in healthcare, 10 years of change have been happening in a few weeks, the ecosystem is well-capitalised and government institutions are in place to provide further support where needed.
EuropeanStartups launched the report WHAT DOES IT TAKE? EUROPE’S STARTUP ECOSYSTEM NAVIGATING THE COVID-19 CRISIS in April 2020 which was supported by the European Commission. The report shows that Europe has made great strides in tech in recent years. The gap with Silicon Valley has been closing, measured by startup formation and VC backed exits. Startups have also become the leading job growth engine in Europe (An estimated 2 million jobs are provided by European startups as of 2019). To stay relevant in the global economy, it is critical that momentum isn’t lost. Alignment between private and public sectors can become a global competitive advantage, even more so in the current environment.
Europe’s startups have started to claim a larger share of global venture capital but Europe still has a lot of catching up to do compared to the United States and Asia. Whilst in the US €1.2T have been invested since 1995 in venture capital and the respective number of Asia being €400B, in Europe only €190B have been invested in venture capital since 1995. In 2019, European startups raised €39B, compared with €116B in North America and €66B in Asia.
2019 average EU per capita funding still lags the US and Israel but individual countries like the UK, Sweden and Finland have closed in significantly.
Europe’s tech ecosystem is much younger than Silicon Valley and therefore it is more skewed towards earlier stage investing. And at early stage investing, it has caught up with the USA. Impressively, 38% of all global seed stage capital is raised by European startups. Europe’s share of total startup funding declines as the rounds get bigger, which is consistent with the idea that Europe’s startup ecosystem is in a much earlier stage of development.
We at primeCROWD monitored the current and future trends in the startup ecosystem attentively and consequently narrowed our focus towards digital economy, health and sustainability in order to effectively lift off the ground a new generation of European ventures. The recently released data from Dealroom.co and Sifted.eu reinforces our strategy as the projected unicorns reflect our focus areas perfectly.