Atomico, the 11-year-old European undertaking company, has released the third version of its State of European Tech report as a way to shine a gentle on what’s going down in Europe, and it’s complete of attention-grabbing information, starting with the truth that 2017 has been a file 12 months for Europe, with greater than $19 billion invested in regional startups, an enormous leap from remaining 12 months, when $14. five billion was once invested.
Apparently, 2017 could also be proving a file 12 months for large rounds of $50 million or extra, with greater than 50 sewn up to this point this 12 months, which beat the former all-time excessive of 43 in 2015 (and, hi there, it’s nonetheless November).
And Europe has been minting unicorns. In truth, seven European firms based since 2003 joined the billion greenback membership this 12 months, which brings the continent’s overall to 41. Some of the latest entrants come with publicly traded Purple Bricks within the U.Okay., which is an internet market for actual property brokers; the Finnish cell video games studio Rovio, which went public previous this 12 months; and Slovenia-based Outfit7, which develops cell apps and video games for the iOS and Android platforms and was once reportedly bought this 12 months through a Chinese chemical company for $1 billion.
Authored through Atomico spouse Tom Wehmeier, who could also be Atomico’s head of analysis, the report’s findings come largely from three,500 founders and traders who have been surveyed for the hassle.
It additionally contains information from a host of companions, together with RelatedIn, StackOverflow and Dealroom to attract its conclusions. They’re price studying in the event you’re looking to get a maintain on what’s going down out of the country, even whilst the upshots are quite rosy sounding.
The find out about issues, for instance, to sturdy world pastime in Europe from world traders, noting that greater than 200 U.S. price range have achieved a minimum of one deal in Europe this 12 months, which is greater than double the quantity in 2012.
Sequoia Capital is amongst those, having not too long ago led a $50 million funding in Graphcore, a Bristol, England-based semiconductor corporate that develops accelerators for AI and device studying. Accel Partners in Silicon Valley additionally made a comparable guess, on MessageBird, a competitor to Twilio in Amsterdam. Other examples come with Obvious Ventures’ contemporary funding within the Bayern, Germany-based jet corporate Lilium Aviation.
Atomico studies that fund sizes are getting larger. This is thank you partly to Atomico itself, which closed on $765 million in capital commitments previous this 12 months to near its largest fund but. But the craze is appropriate extra broadly, with moderate fund sizes rising 3 times between 2012 and 2017.
“This is a huge positive,” says Wehmeier, noting that “historically, there’s been a lack of funds able to write $20 million checks to support companies in the region. Now, whether Atomico or other local-based funds, [VCs] have been successful in going to LPs to write checks.”
Wehmeier additionally notes that a lot of the capital is coming from govt companies, which might be “important sources of funds” in Europe, in contrast to within the U.S., and that some other 20 % of price range are coming from European “corporates” that increasingly more need to perceive the moving tech panorama. (In some circumstances, those corporates are getting extra acquisitive, too, as with the sale of good lock corporate August Home to Swedish lock massive Assa Abloy, and Ikea’s acquisition of TaskRabbit.)
The Atomico report additional notes very sturdy pastime from Asia in what’s going down at the continent, with $1.eight billion invested to this point this 12 months in European firms through Asian traders, together with Softbank’s $502 million funding in May in Improbable Worlds, the London startup that has evolved a platform for third events to construct huge digital and simulated worlds.
JD.Com additionally invested more or less $400 million within the luxurious market Farfetch in June, as phase of a strategic partnership.
Yet what’s possibly maximum attention-grabbing, and other, about Europe, is its IPO marketplace. So a ways this 12 months, extra firms have long past public in Europe than anyplace else globally. The explanation why, says Wehmeier, is that in contrast to within the U.S., the place some firms are ready to achieve sky-high earnings thresholds, “sometimes companies here have just $100 million in revenue, but there’s appetite here” for them regardless, he says — most likely as a result of their after-market efficiency is conserving up. Indeed, Atomico says European tech firms are buying and selling up 24 % on moderate above their IPO costs, as opposed to just 6 % for U.S. firms.
You can take a look at the whole report, and some of its way more granular knowledge, right here.
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