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2021 has been a remarkable year for the European venture capital (VC) ecosystem. Venture capital investments in Europe crossed the 100 billion euro mark for the first time in 2021, reports Pitch book in the recentEuropean Business Report 2021” with EMEA VC analyst Nalin Patel.

Here are six key takeaways from the report:

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Venture capital investments in Europe reached 102.9 billion euros

Venture capital investment in Europe reached €102.9 billion, according to the report, as investors and startups closed substantial rounds throughout an exceptional 12-month period.

The number of completed venture capital deals reached a record 10,583, indicating that rounds are increasing in frequency and scale across the European venture capital landscape.

In 2021, late-stage capital accounted for a record 70% of the global value of venture capital deals, equivalent to €72 billion.

“COVID-19 has accelerated growth rates and capital invested in the majority of late-stage venture capital-backed companies in Europe in 2021,” the report said.

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Venture capital transactions by region and sector

According to the report, startups in the UK, which is Europe’s most developed venture capital market, raised the most in 2021 of all European countries. According to the report, many of the largest deals came from the fintech sector.

In the DACH region, VC has invested around 16.5 billion euros in German startups. Outside of Germany, Austria has also seen significant fundraising from digital investment platforms like Bitpanda and GoStudent.

France has seen around €9.9 billion in investment, boosted by the government to strengthen its startup ecosystem.

Amsterdam continued to cement its status as a venture capital powerhouse with massive rounds including payments provider Mollie, e-bike brand VanMoof and cloud communications company MessageBird.

In the Nordics, Swedish battery developer Northvolt achieved the biggest round of 2021 at 2.3 billion euros. Others, including Klarna, MessageBird, Celonis, Gorillas and challenger bank N26, also got strong support, the report noted.

In Central and Eastern Europe, Lithuania has seen the largest increase in invested capital this year, albeit from a low starting point – with a 990% increase to 351.2 million euros, adds the report.

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VC in Southern Europe

According to the report, the bulk of venture capital deals in Southern Europe come from Italy, Spain and Portugal. The value of transactions in the region reached a record €3.7 billion through the third quarter of 2021, an increase of 40.3% compared to 2020.

However, there are few large late-stage venture capital-backed companies in Southern Europe compared to other European regions, the report adds.

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Venture capital operation activity with the participation of non-traditional investors

Recently, non-traditional investors, including investment banks, private equity firms, hedge funds, pension funds, sovereign wealth funds and venture capital firms (VCCs), have significantly increased their exposure to the capital risk.

The venture capital deal with participation from non-traditional investors reached a record 78.4 billion euros.

The finding indicates that non-traditional investors have also been drawn to emerging startups for strategic partnerships and synergistic opportunities.

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Resume output activity

In 2021, exit value soared to a staggering 142.5 billion euros, more than triple the previous best set in 2018. According to the result, a record number of companies exited in 2021, at 1 241, nearly double the amount of 2020.

Some of the notable releases that helped generate record aggregate release value in 2021 included the public listings of Sportradar, On, Wise, Deliveroo and AUTO1 Group.

In 2021, a record 186 IPOs of European-based companies took place, generating an incredible €117.3 billion, almost four times the previous peak set in 2018 .

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VC fundraising activity

In 2021, 203 venture capital funds closed and raised €21.7 billion, which represents a 31.9% drop in the number of funds and a 10.1% increase in capital raised compared to figures of 2020.

Capital raised reached the second highest total in the calendar year, however, 2021 saw the lowest number of venture capital funds since 2013, the report added.

Several established GPs (partnerships) closed an oversized fund collection in 2021, including Index Ventures, which closed a €1.7 billion ($2 billion) growth-stage fund.

Additionally, notable fundraisers include Cathay Innovation Fund II closing at €649.5m, Balderton Capital raising €519.6m for its latest fund and Accel raising €539.1m for investments. in Europe.

According to the report, the bulk of venture capital fundraising in 2021 took place in the UK and Ireland, DACH and France and Benelux ecosystems. The three regions contributed 16.7 billion euros, or 76.6% of the total capital raised in Europe. Funds in the UK and Ireland led the way with 6.7 billion euros.

“As we transition to 2022, we believe VC fundraising will increase in Europe. 2021 was a record year for exit value and excess cash was delivered to LPs. in capital will increase and the size of venture capital vehicles will increase, thereby increasing the overall fundraising total,” says Nalin Patel.

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