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Venture capital investment in European startups reached $29.8 billion in the first quarter of 2022, the second highest quarter on record for startups on the continent, according to data from Crunchbase.

In the first quarter, venture capital funding in Europe in the last quarter was up 21% year-over-year and 4% quarter-over-quarter, bucking the trend worldwide and in North Americawhere Q1 2022 investments fell compared to Q4 2021.

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Funding for European startups reached an all-time high of $37.6 billion in the second quarter of 2021. This period showed increases in all stages of funding, but much more in late-stage venture capital funding.

Quarterly funding in Europe in 2020 ranged between $10 billion and $13 billion per quarter. Since last year, quarterly funding has trended upward from the first quarter of 2021, when it stood at $24.6 billion.

Let’s dive into European funding in stages over the last five quarters to analyze these trends.

The late phase is over

Prior to 2021, a smaller proportion of Europe’s venture capital dollars was spent on late-stage development and technology growth. In 2021, a shift has occurred, with larger amounts allocated to late-stage funding. Funding for these ventures came from growth capital firms in the United States and around the world.

Companies in Europe that raised large funds in the first quarter of 2022 include the London-based company Checkout.comwhich raised a $1 billion Series D funding from a slew of growth-stage investors, making it Europe’s second-highest-valued private company at $40 billion, below 2021 valuations of Klarna to $45.5 billion, and ahead Revolution valued at $33 billion.

Other major late-stage funding has been raised by a Turkey-based delivery company Getir and micro-mobility company Lockbased in Estonia.

The early stage is over

Seed funding in Q1 2022 was $9.4 billion, up 50% year-over-year from Q1 2021. This is significant as it shows that the number of European companies in the first quarter weren’t just boosted by a few outsized late-stage funding rounds. , but also a growing seed funding environment ready for future growth.

Seed stage

Seed-stage startups across Europe raised $2.1 billion in the first quarter across more than 1,000 companies. 1


Leading country in early stages

The six countries that led the seed process with seed funding last quarter are the UK, France and Germany vying for second place, followed by the Netherlands, Switzerland and Germany. ‘Spain.

Global trends

How do the trends we’re seeing in Europe compare to global funding in Q1?

Overall, the financing of the first quarter fell from a peak in the fourth quarter of 2021partly because of the decline in value of public technology stocks.

Funding for European startups bucks these trends with amounts up for the quarter on a year-over-year and quarter-on-quarter basis.

why is this the case? Europe is a growing venture capital market with a historically less developed late-stage funding market. Europe is also a market, apart from the more established US market, where global growth investors are looking for new investment opportunities.

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Further reading

Methodology

The data in this report comes directly from Crunchbase and is based on reported data. Data reported is as of April 7, 2022.

Note that data lags are most pronounced in the early stages of venture capital activity, with seed funding amounts increasing significantly after the end of a quarter/year.

The most recent quarter/year will increase over time compared to previous quarters. In terms of funding, we see a strong data lag, especially at the seed and start-up stages, up to 30% to 40% per year.

Please note that all funding values ​​are given in US dollars unless otherwise stated. Crunchbase converts foreign currency to US dollars at the spot rate in effect as of the date funding rounds, acquisitions, IPOs, and other financial events are reported. Even though these events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historical spot price.

For the analysis of M&A transactions, we include venture-backed companies and exclude companies that have previously gone public.

Glossary of Funding Terms

Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes VC rounds of unknown series, equity crowdfunding, and convertible notes at $3 million (USD or converted USD equivalent) or less.

The early stage includes Series A and Series B rounds, as well as other types of rounds. Crunchbase includes VC rounds of unknown rounds, venture capital and other rounds greater than $3 million, and those less than or equal to $15 million.

Late Stage includes Series C, Series D, Series E and later venture rounds after the “Series [Letter]” naming convention. Also included are VC rounds of unknown series, VC and other rounds above $15 million.

Tech growth is a private equity round raised by a company that previously raised a “venture” round. (So ​​basically any round of the previously defined stages.)

Drawing: Dom Guzman

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