Amid a busy yr, the continent’s VC momentum seems set to proceed in 2022
Europe, lengthy seen as a relative backwater to the U.S. startup market, has been on a tear in latest quarters and years. Akin to many startup markets world wide, Europe has seen its enterprise capital totals rise, its unicorn ranks swell, and even a number of main public exits.
How sizzling is the marketplace for European startups this yr? This morning, FiratNews reported that Flink raised $750 million. The “Berlin-based startup that sells meals and different necessities at grocery store costs and goals to ship them in below 10 minutes,” as we described it, is now price $2.85 billion. And until you might be very aware of the moment grocery market, we doubt that you just had been too conscious of Flink.
The European startup market is now sufficiently strong and diverse that it’s straightforward to lose observe of its unicorns.
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The Trade has been monitoring Europe’s startup acceleration for years now. So, think about our common delight when Atomico, a European enterprise fund, and Dealroom, a data-tracker with a stable European knowledge set, dropped an enormous sheaf of numbers regarding its efficiency earlier this week.
Tied up as we had been with our e book guides (right here and right here), we’re simply now attending to the info. So, as an alternative of snagging simply high-level numbers that paint a extra common image, we’re teasing out a number of issues that you just might need missed in your individual learn. In the event you care in regards to the state and the well being of the European startup market, that is for you.
We’ll check out exit volumes and what we will infer for 2022, how expertise points aren’t touchdown equally across the continent, why there’s good and dangerous information for gender variety in Europe, how pension fund cash continues to be on the sidelines, and which collections of former staff are founding essentially the most firms.
Sounds good? Let’s rock.
Excellent news for 2022 European exits
European expertise M&A is having a very good yr. The Atomico/Dealroom report particulars that the full worth of tech M&A in Europe by way of the third quarter of 2021 has crossed the $100 billion mark. For reference, that determine was beneath $10 billion in Q2 2019, Q3 2019, This fall 2019 and Q2 2020.
However not each tech exit matches into the enterprise capital mannequin. Enterprise-backed exits for European tech firms are a smaller determine, however one that’s nonetheless rising. Per the identical knowledge set, within the first three quarters of 2021, VC-backed tech M&A labored out to $54.9 billion. That’s a hair greater than the full-year 2020 variety of $54.8 billion. Throw in This fall’s numbers, and never solely will 2021 be a document yr for VC tech exits – this knowledge doesn’t embody IPOs, thoughts – it will likely be one by a cushty margin.
However all that’s the previous. We care extra in regards to the future. And that’s the place the info set pushed our eyebrows increased. Atomico wrote the next:
Within the third quarter alone, the aggregated worth of tech M&A exercise exceeded $45B, making it the most important Q3 on document. At time of publication, preliminary numbers for This fall suggest not less than one other $50B in mixture worth.
If these numbers maintain up, we may see roughly 50% of the 2020 whole European M&A in This fall 2021 alone. That, and incremental good points from quarter to quarter, implies that Europe is beginning 2022 on its strongest non-IPO exit footing in historical past. Bullish!
The UK’s expertise points are notable, worsening
Bear in mind Brexit? In the event you don’t reside within the U.Okay., the political and financial decoupling of the island from the continent could have receded into the again of your thoughts. It’s an SEP to some extent: another person’s downside. However whereas we could give it some thought a bit much less, U.Okay.-based startups haven’t forgotten.