I recently joined Aldea Ventures' Carlos Trenchs for a keynote fireside chat at 4YFN Barcelona. We discussed how vastly different European venture was when I co-founded Atomico 15 years ago. The ecosystem was only a fraction of the size it is today. Just looking at a few of the numbers tells an incredible story.
According to Dealroom, in 2005 €2.1bn annually was going into European VC and there were only 239 active VCs. Today, this number is €50-60bn - a 25-30X increase - a 24% annual growth rate over that 16 year period, and there are over 2000 active VCs - that's nearly ten times as many.
While these flashy statistics illustrate powerful compounding growth, I think there is a much deeper multiplicative effect at play here.
Companies coming out of Europe are hugely diverse, attempting to solve a broad range of issues and touching more of society than ever before. With each generation of new company entering into the multi billion Euro category, there is a domino effect with more companies being formed. We can see this very clearly in the financial services sector - Adyen, Klarna, Revolut, Monzo and Transferwise all became multi billion dollar companies one after another - and this is becoming true in gaming, healthcare, marketplaces and enterprise software.
Such category leaders are a breeding ground for founders that want to take on a new challenge, usually with the ambition of building something even bigger than where they came from. At Moonfire we have invested in founders coming out of Revolut, Supercell, Spotify and King, as well as other rising stars across Europe.
The success of Europe's VC ecosystem is enticing world-class tech talent from universities across the globe, students who prize an entrepreneurial journey more than any other career.
Furthermore, the success of Europe's VC ecosystem is enticing world-class tech talent from universities across the globe, students who prize an entrepreneurial journey more than any other career. Leaders and operators from global tech companies like Facebook and Google (with massive operations here in Europe) are bringing their scaling expertise to the table. And lastly, there is a larger number of serial entrepreneurs than ever before; they've got the battle scars to show for it and are brimming with ambition.
Success is breeding success. This is a new Europe driven by a new class of innovators.
Thanks and appreciation is owed to Dealroom and Yoram Wijngaarde (Dealroom's Founder and CEO) for helping us put together the data in this article as well as for being a consistent source of high-quality data on European technology.