Funding down and valuations flat in Q1 for European startups

It’s been a rough start to 2023 for European startups. In the first quarter of the year, dealmaking decelerated, valuations flattened, and exits remained subdued, according to new research.

Analysts from PitchBook, a financial data firm, found that investor priorities have shifted from growth at all costs to profitability.

After a boom in VC activity that trickled into early 2022, reports of lower growth rates, workforce reductions, and tougher funding conditions have emerged. As a result, due diligence processes have lengthened, with revenues, valuations, and runways under heightened scrutiny.

Nalin Patel, the report’s author, noted that investors across the board have become more selective.

“We are seeing declines across financing stages, sectors, and geographies,” Patel told TNW.

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Deal value and count for unicorns fell 87.5% and 65.5% from Q1 2022, respectively

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