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One of the most critical ways in which the European tech ecosystem has evolved has been the buildout of the investor base supporting it, which has grown in depth and, importantly, sophistication. One way to demonstrate the remarkable expansion of the investor base is to look at the number of unique institutional investors that have made at least one investment in European tech per year. In 2018, this reached more than 2,500 unique institutions, up 2.8x since 2013.
# of unique institutions that have participated in at least 1 and 5 investment rounds in Europe per year
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- Unique investors
- Note:
- Number of unique investors (incl. investment funds, corporate investors & accelerators, but excl. angel investors) that have participated in at least 1 investment round per year. 2018 annualised based on data to September 2018.
It's important to note, however, that more capital and more investors alone are not enough. In order to maximise the chances of success for early-stage European startups, it's important that capital is allocated to sophisticated investors best able to support young companies as they navigate the scaling journey. This is proven in data. Startups raising Seed from top investors are significantly more likely to raise a Series A.
Median conversion rates to Series A within 36 months of Seed round, by investor quartiles
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- Conversion to Series A (%)
- Median conversion rate to Series A (%)
- Note:
- Based on disclosed Seed and Series A rounds, conversion rates calculated for VC funds that made at least 8 Seed rounds since 2012, and at least 75% of first investments at Seed/Pre-Seed. See: https://blog.dealroom.co/the-journey-to-series-a-in-europe/
The growth in the investor base has been supported by a diverse set of new entrants that are deploying capital in European tech for the first time. As in other regions, corporate investors have become active in Europe in significantly greater numbers.
# of unique corporate investors per year and number of rounds involving at least one corporate investor
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- # of unique corporate investors
- # of deals
- Note:
- Unique corporate investor count is based on number of corporate (i.e. non investment fund) investors that have participated in at least 1 round per year. 2018 annualised based on data to September 2018.
US investors continue to invest actively in European tech companies, although the number of unique institutions that have participated in at least one investment round in 2018 is down slightly on 2017.
# of unique US institutions that have participated in at least 1 investment round in Europe per year
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- # of unique US investors
- Note:
- Number of unique investors (incl. investment funds, corporate investors & accelerators, but excl. angel investors) that have participated in at least 1 investment round per year. 2018 annualised based on data to September 2018.