The Global Startup Ecosystem Report 2022

Europe Insights, Rankings & Ecosystem Pages

European startups and scaleups are largely concentrated in the UK, Germany, and France, with nearly two-thirds of the continent’s top 1,000 startups and scaleups founded in one of these countries. In 2021, both Germany and the Netherlands experienced a year-over-year growth of more than 200%, and Spain grew more than 400%. The proportion of funds invested outside of the UK also increased. Estonia is one of the smallest countries in Europe, but the country has 1,048 startups per capita and has raised €1,967 per capita in investments, both exceeding any other country in Europe.

The amount of capital invested in startups, deal volumes, and exits all reached their all-time highs throughout 2021. Europe experienced over 10,000 venture deals in 2021, totaling almost €103 billion. Nearly 2,900 deals were first-time venture financings, totaling €9.9 billion. To put these figures in perspective, Europe experienced approximately 2,400 venture deals in 2020, totaling €3.6 billion. 2021 brought nearly five times the number of deals and over 28 times the valuation of the previous year.

2021 also brought the largest total equity value that European tech startups have ever seen. According to Dealroom and Atomico, this total equity value exceeded $3 trillion for the first time in 2021 (accounting for startups in both the public and private markets).

Stockholm battery manufacturer Northvolt raised $2.75 billion in a July 2021 funding round, Helsinki-founded food delivery company Wolt was acquired for $8.1 billion in November, and Fintech Klarna raised $1 billion in March, making it the highest-valued private Fintech company in Europe at the time.

One driver of growth is the interest of international investment firms. SoftBank, Tiger Global, Coatue, and Balderton Capital among others have sought out European startups, and Balderton Capital alone secured approximately $1.3 billion for two new funds in 2021.

Key Findings

  • European VC funding was 128% higher in 2021 than in 2020, with increases at every stage.

  • Early-stage funding deal amount has increased by 47% from 2020 to 2021.

  • The number of exits over $50 million has increased by 68% from 2020 to 2021.

  • Helsinki shot up more than 20 spots, from #59 in 2021 to tied #31 this year. The ecosystem saw seven exits over $50 million, including food delivery company Wolt’s $8.1 billion November 2021 acquisition by DoorDash, and gained two unicorns in the period considered.

  • Copenhagen is also tied at #35, up from #43 in last year’s ranking. The Danish capital saw two $1 billion+ exits, including Unity’s $13.7 billion valuation at IPO in September 2020.

  • In 2021, the dollar amount of exits in London grew 413% from 2020. The ecosystem’s Series B+ rounds increased 162% in terms of dollar amount from 2020, and it saw 55% more $50 million+ exits in 2021 versus 2020.

  • In the Emerging Ecosystems rankings, Oslo moved up 22 places since last year, to #19. The Norwegian ecosystem produced two unicorns in the period examined — industrial IoT platform Cognite and online grocery Oda — helping to increase its Market Reach.