TLDR:
- Europe’s VC market is showing signs of recovery with increased deal sizes and valuations.
- UK and Ireland start-ups are facing challenges with lower deal sizes and valuations.
Europe’s venture capital (VC) sector is rebounding, according to a report by PitchBook, indicating growth in deal sizes and valuations. The median deal sizes across all stages in Europe increased in the first quarter of 2024, with pre-seed funding showing the most resilience. Pre-seed deals saw an increase in valuation and deal sizes quarter-over-quarter. The report also noted a rationalization of industry players, potentially creating a higher quality start-up pool.
While most European regions saw growth in valuations, the UK and Ireland faced challenges with lower deal sizes and valuations. The report highlighted that the majority of down rounds were from start-ups in these regions, with the median deal size for UK and Ireland start-ups at €2.8m.
Specific sectors also showed varying median round sizes, with the fintech sector leading at €3.3m, followed by clean-tech at €2.9m and consumer tech at €1.3m. The report also pointed out that US VC funding hit a low in the first quarter of 2024, indicating subdued dealmaking in global markets.
