What you need to know about the European investment market in Q1

06 April 2021 Insights
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We are wrapping up the Q1 numbers about the startup investment deals we tracked in Europe.

It was an average quarter from the activity perspective - about the same number of deals range at ~1500 as compared to last year (1450) or to 2019 (1600).

From the $ dollar perspective though, we have a spectacular increase: more than $17 billion compared to about $7 billion in 2020 and $9 billion in 2019.

It is not a surprise, the market is flooded with money in the hands of the local investors, EU is making a solid push to add fuel to the fire, and the American investors in Europe... Oh, the Americans are in all the great deals from Europe, quietly doing their best.

So the same number of deals and 2X the value, where did the money go? Growth equity from earlier stages than in the past, as the risk appetite is starting to grow and more competition reflects in higher valuations.

We've never ever seen so many bold bets in Europe - now that we have our pockets full of money and we're in the casino, we might as well switch from playing the slots machines to the roulette and poker table, like grown ups do.

All this means that the market is becoming more competitive and mature and plenty more people are professional about investing in Europe - but don't get your hopes high, in the grand scheme of things Europe is still the third hub in the world, far away from the Chinese second place.

The European market is full of money to be deployed in spite of the economic recession, and investors gotta put it to work. And they do, according to the Q1 data.

The numbers making the big picture look like this:

 

Overall

  • 1258 deals | $17.4bn | 235 with undisclosed value

 

Deal size

  • < $500k: 121 deals | $30M
  • $500k-1M: 89 deals | $64M
  • $1-5M: 410 deals | $994M
  • $5-10M: 145 deals | $1bn
  • $10-20M: 96 deals | $1.4bn
  • $20-50M: 95 deals | $2.9bn
  • $50M+: 67 deals | $11bn
  • n/a: 235 deals

 

Verticals

  • software: 636 deals | $5.5bn
  • manufacturing: 265 deals | $2bn
  • financial services: 227 deals | $5.4bn
  • e-commerce: 160 deals | $3bn
  • health: 153 deals | $1.3bn

 

Investors

 

Cities

  • London 182 deals
  • Berlin 111 deals
  • Paris 100 deals
  • Stockholm 80 deals

 

Notes:

  • all data is manually verified, cross-checked from several sources (i.e. investors, startups, governmental sources). We don't scrap it from other people's work (which is standard for established businesses), and do our best in making sure that what we add is correct.
  • data doesn't include activity from Israel and Russia. Central Eastern Europe has a bit of a lag too.
  • the numbers from above include only capital raises. Deals like this, for example, are treated separately as the rationale (and most of the value) is a share transaction, not growth equity.
  • as always, data is just indicative on as is basis, we update the databases every day, and there's a considerable delay in gathering and structuring it. But numbers make for a good understanding of the big picture.

 

If you're interested to dig deeper and understand more, we have created a few data reports crunching Q1 data:

  • The largest transactions
    - 12 transactions originating from UK, 8 from Germany, 3 from Spain, 2 each from Finland, France, Ireland and Sweden.
    - 10 ecommerce deals, SAAS 9 deals, financial services 4 deals
    - 3 of them were involved in TWO capital raise deals in Q1.
  • The most active investors in Europe
    - VCs involved in minimum 5 deals: 14 from the US, 12 each from Germany and the UK, 7 VCs from France
    - angel investors involved in minimum 3 deals: 4 French, 3 Estonians, 2 Swedes and Brits etc
  • Active investors in DACH in Q1 2021 - Germany, Austria and Switzerland.
  • Active investors in the UK in Q1 2021.
  • Active investors in France in Q1 2021.
  • Active investors in the Nordics in Q1 2021.
  • Active American investors in Europe in Q1

You will need to log in in order to access the reports - they are part of the Cheat Sheet Library and provided complimentary with the data access to all N9 customers.

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