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TOP 60 Venture Deals in Europe -- Is Entrepreneurial Renaissance Coming?
TOP 60 Venture Deals in Europe -- Is Entrepreneurial Renaissance Coming?
Associated Company
EqualOcean EqualOcean

Private markets are attractive due to their greater immunity to geopolitical shocks, as well as their resilience amidst trade wars and Brexit battles.

In particular, cross-border equity ownership and foreign direct investment have better shock-absorption properties than cross-border bank lending that in crisis times can lead to sudden stops, especially if the banking union remains incomplete.

                                                                            -- André Sapir, Nicolas Véron and Guntram B. Wolf

                                                                         "Making a reality of Europe’s Capital Markets Union"

However, the reputation of the venture capital and private equity (VC/PE) industry in Europe has suffered from the repercussions during the early 2000’s techno-bubble that affect their long-term statistics. The low average IRR of 1.21% for years also results from their mainly bank-based financial systems, fragmented along national lines and lack of adoption of data-driven methods in strategic decision making.

Is that still the case? How are European VC/PE markets performing lately?  EqualOcean analyzed the VC/PE investment events statistics, considering data from 2016 to the first half of 2019 to answer these questions.

Big Picture

What is the European VC/PE market niche in the world and how has it been changing recently?

Europe has taken a big leap in the right direction but is still clearly behind the rest of the world.

In 2017, global VC activity reached a then-record high with over USD 164 billion invested, nearly 50% up compared to 2016. In 2018, we saw another 50% growth, with a staggering total amount of USD 255 billion invested: Companies residing in the United States still dominate the global scene with 51% of the total financing received. Companies in the Asia Pacific have been raising funding actively as well: Total amount of money invested in the local enterprises amounted to USD 90 billion. At the same time, in Europe, this indicator grew slightly to just over USD 24 billion.

In the first half of 2019, the venture capital pulls back in speed in the US and China, the currently two biggest economies. Though not comparable in deal amount, European VC investment reached an all-time high record of over USD 25 billion, surpassing the aggregated deal value recorded in 2018.

Investment Trend

Please be noted that in this analysis we only consider pre-seed, seed, angel investment as well as Series A, B and so on rounds of funding. Convertible notes, debt financing, grant, corporate funding, crowd-sourced funding in VC/PE markets are excluded.

By comparing the general trend in Europe, we found that funding volume is up but the number of deals is down in the first half of 2019. Some of the large, global VC funds were acting more and more like PE players and concentrated on very large later-stage deals.

According to Crunchbase database, venture investments into European startups reached USD 25.89 billion so far this year; an all-time high. The capital investments were spread over 1,715 venture deals.

Investment by Countries

By summarising deals closed in different countries,  a very stable yet slightly increasing landscape appeared as almost 80% of the venture deals in Europe spanned 10 countries, including United Kingdom (UK), Germany, France, Spain, the Netherlands, Italy, Switzerland, Russia, Sweden and Ireland. 

As to deal value in different countries, we screened investment to 60 cases that were financed over USD 50 million in the first half of 2019. By ranking those countries based on deal amount, the previous country ranking has re-sorted while three countries “survived” in the shuffle -- UK, Germany and France.

Venture financing remains strong in the UK despite growing Brexit uncertainty. The UK continued to attract significant funding with 533 deals closed so far this year. The robustness of the UK’s innovation ecosystem remained as both deals value and number ranked first in other European countries. The UK accounted for two deals in European largest four deals in the first half of 2019 – a USD 1 billion raised by a retailing platform selling fast-moving consumer goods called the Hut Group and a USD 575 million raised by Deliveroo, an online food delivery platform. Financial services or fintech also attracted a significant amount of investment as in 2018. The challenging players TransferWise, LendInvest, Checkout, WorldRemit, iwoca and Monzo were among the top funding rounds.

Another focus for UK is the government regulation, the development of frameworks to guide the ethical use of AI technology.

VC investment in Germany had a solid and diversified performance in different sectors such as financial services, AI technology provider in the enterprise service sector, food & agriculture, healthcare, real estate, transportation & logistics and travel & leisure. Three companies listed in the top 10 investment cases in terms of deal amount with USD 484 million, USD 300 million and USD 300 million raised by GetYourGuide, N26 and QUARTERS respectively. Besides, AI also poised for significant growth in Germany, which will be further discussed in the following European VC/PE articles.

France VC ecosystem grows stronger. Of 12 investment cases raised for more than USD 50 million in France, seven are enterprise services that provide AI or big-data-related services. Of the nine healthcare deals, France tops with three companies financed USD 170 million, USD 73 million and USD 50 million respectively. Meero, an AI company providing enhanced photography services raised the most money with USD 230 million in all deals in France.

Investment by Sectors

Financial services, enterprise services and healthcare ranked top three in deal number while enterprise services, financial services and travel & leisure took the position in deal value. Travel & leisure raised a higher than average USD 370 million per deal in all sectors.

Below is a cross-analysis of sectors' deal closed of different countries. We proved UK’s fintech power again as it remained champion in deal number, but also hit a record level of investment value as startups turn into scale-ups. 

London was home to more than 80% of the fintech startups that took in VC funding in 2018, and claimed more than 90% of the capital invested overall. The UK maintained its position in third globally for overall fintech funding, coming in behind China and the US.

Then EqualOcean sorted out a VC/PE map in the first half of 2019, providing a comprehensive landscape of those company deals in different sectors. Based on that, we will have a further analysis of sectors and companies in the future.

 

Enterprise Information

EqualOcean is a leading industry tech media and an investment research company.
CATEGORIES: AI, Research
Last Funding Type
Series C
Number of Employees
200
Number of Funding Rounds
6
Total Funding Amount
26.79M

Enterprise Information

EqualOcean
EqualOcean is a leading industry tech media and an investment research company.
CATEGORIES: AI, Research
Last Funding Type
Series C
Number of Employees
200
Number of Funding Rounds
6
Total Funding Amount
26.79M

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EqualOcean is a leading industrial tech media and investment research company that focuses on technological and industrial innovation in China.

We aim to assist Chinese entrepreneurial enterprises to break into the global market and provide overseas investors, VCs, and enterprises with a deeper understanding of China's business environment and to seize opportunities in China.

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