Funding for European startups is expected to total $51B in 2023, per Atomico. The funding represents a decline of 39% over 2022's values of $83B, which itself declined 22% from peak values of $106B in 2021. The slump in European tech startup funding is attributed to the retreat of U.S. investors. - Despite the drop, the European tech industry showed signs of resilience, with overall valuations of public and private tech companies in the region crossing the $3T mark.
- The funding pullback will impact late-stage startups more than early-stage ones, accounting for 93% of the deficit between 2022 and 2023.
- Early-stage startups raising less than $15M rounds collectively raised $8.2B in the first half of 2023, down from $10.3B a year ago.
- The global macroeconomic headwinds have impacted the valuations of startups, with average multiples of public SaaS startups now 5x their revenue, compared to the previous average of 7.8x.
- As a result, 20% of the rounds in Q1 2023 were down rounds.
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