Hot or not: Where European VC funding went in 2020
The record amount of venture capital investments in Europe this year suggests that appetite for the region's startups remains strong despite the global pandemic. Including investments in Israel, VCs invested $ 46 billion in the continent on Dec. 14, surpassing the previous year's record of $ 41.8 billion, according to PitchBook data. One reason for this is that many startups have thrived at a time when digital remote services - from grocery delivery to e-commerce - are more in demand than ever.
The VC investment also focused on fewer rounds. As of December 14, the number of venture capital trades had dropped from 7,502 to 5,883 this year, with almost all countries seeing a decline in trades. Some jurisdictions have fared better than others. Check out the map below for a snapshot of the continent's hottest areas for VC investing in 2020: UK The UK remains the top VC investing attraction in Europe, according to PitchBook. British companies have raised $ 13.7 billion so far this year. The number of deals fell by 27% to 1,791 compared to the previous year.
Five new British unicorns were created in 2020, more than any other European country. Gousto's valuation topped $ 1 billion when the meal set startup raised £ 25 million (roughly $ 34 million) from existing investors Perwyn and BGF in November.
Another newly minted British unicorn was the virtual events startup Hopin, which raised a $ 125 million Series B in November, valued at $ 2.1 billion. Other notable deals include Digital Bank Revolut's Series D, valued at $ 580 million, and Amazon's long-awaited $ 575 million investment in Deliveroo, which was approved by the Competition and Markets Authority after a year-long investigation in August was approved. According to PitchBook data, risk financing in the DACH region of Germany increased by 10.9% in 2020. One of the biggest rounds was for COVID-19 vaccine developer CureVac, which in July raised $ 640 million from donors such as the Qatar Investment Authority, GlaxoSmithKline and the federal government who want to fund more startups in the district in 2021 for supporting German startups A government fund of EUR 10 billion (around USD 12 billion) was announced over the next decade to attract additional private VC investment of EUR 20 billion. Other notable German rounds in 2020 include the $ 570 million Series D from fintech provider N26 and the $ 250 million Series C from the e-scooter startup Tier Mobility.
Austria was one of the fastest growing ecosystems this year. Individual businesses have remained small, the largest being a Valar Ventures-led investment of $ 52 million in Bitpanda, the operator of an exchange that trades digital assets, according to PitchBook data. Switzerland also showed resilience, supported by the abundance of biotech startups. Among other things, Arvelle Therapeutics, a company that develops treatments for central nervous system disorders, raised $ 207.8 million in May, while Sophia Genetics raised $ 110 million for its AI-based medical data platform in October. France and Benelux France remains the third most active VC market after Germany and the gap is closing. As in Germany, startups receive additional government support. In September, President Emmanuel Macron announced that the government would provide EUR 7 billion in additional funding to support the digital economy and start-ups.
Ynsect, a Paris-based startup that breeds insects for animal feed and fertilizer, brought in France's largest round in 2020 with $ 372 million. And SaaS startup Mirakl hit a valuation of $ 1.5 billion in September after a $ 300 million round led by Permira.
The Netherlands was the Benelux's biggest winner, seeing VC funds increase by more than 38%, according to PitchBook data. Startups in the country raised $ 1.6 billion in venture investments in 232 deals, some of which occurred towards the end of the year. MessageBird raised a $ 200 million Series C valued at $ 3 billion for its cloud communications platform in October, and Amsterdam-based payments specialist Mollie raised € 90 million in a round led by TCV in September .
In both Luxembourg and Belgium, VC investments fell by around 23% and 18.1% respectively in 2020, according to PitchBook data. A bright spot for Belgium was data intelligence company Collibra, which raised $ 112.5 million in April and increased its valuation to $ 2.3 billion. Nordics Norway had a busy year. According to PitchBook data, VC investments increased 73.9% to $ 458 million on Dec. 14. Finland has exceeded $ 1 billion in venture funding for the first time thanks to startup Wolt and proptech company Kodit.io. In Sweden, payment company Klarna became Europe's most valuable VC-backed fintech startup this year after securing a $ 650 million round. Swedish companies received a total of 3.2 billion US dollars in 2020, which was funded through several mega-rounds. Stockholm-based company Kry benefited from the growing popularity of virtual medical consultations and raised 140 million euros. Due to the increasing interest in micromobility, the e-scooter startup Voi received 160 million US dollars. Israel Israel's VC funding surged over $ 750 million to $ 4.9 billion in 2020. Four startups have passed the $ 1 billion valuation mark. In January, Calcalist reported that Insight Partners had acquired a 10% stake in Moon Active and valued the Tel Aviv-based mobile game developer at $ 1.25 billion. Cato Networks, the developer of a cloud-based enterprise security platform, raised $ 130 million last month and raised its valuation to over $ 1 billion.
The existing unicorns in the country recorded some violent laps. Ridehailing app developer Gett raised $ 100 million ahead of its alleged IPO, while behavioral biometrics startup BioCatch raised a $ 145 million Series C, led by Bain Capital's engineering opportunities arm. Central and Eastern Europe Estonia is one of the few European countries that actually closed more deals this year than in 2019. In the tiny country known for creating powerhouses like Skype and TransferWise, VC investments went in December decreased by 5.3% to USD 104 million. 14, according to PitchBook data. A few days later, Tallinn-based Uber rival Bolt raised € 150 million in a round led by D1 Capital Partners.
The rest of the region did not fare so well. Only two other countries have exceeded $ 50 million in VC funding, and both have seen sharp drops in activity. Investments in Poland fell by around 42.9% to USD 113.3 million, while Hungary was the worst performer in Europe. VC funds were down nearly 80% to just under $ 75 million. Southern Europe Spain's VC ecosystem saw double-digit growth this year. The AI-powered biotech startup Quibim raised € 8 million in July to detect cancer, Alzheimer's and COVID-19, among other things.
VC deal activity in Italy also increased for the year, leaving the country just under $ 500 million in risk financing on Dec. 14. Notable deals in 2020 included the € 25 million round by Milan-based logistics startup Milkman in May and autoimmune-focused biotech company Enthera's € 28 million Series A in July.
Selected image courtesy of Voi
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