Atomico's State of European Tech report 👀

Good morning there,

On today's agenda we've got a new VC fund from former Speedinvest and Signals investors, the lowdown on a wave of European fintech operators pivoting to climate tech and... the big one — Atomico's latest State of European Tech report.

— Sadia, editorial assistant

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New report: The state of CX in Europe

IDC and Zoom reveal how leading European companies are reshaping customer experiences, including the pivotal role of personalisation and the rise of conversational technologies.

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The state of European tech

Atomico’s State of European Tech report is out — a must read for anyone in European tech. It shows the market is still slowing from the peak of 2021, but also that the long-term maturation of European tech is unchanged — more tech hubs are maturing and creating great companies, a deeper bench of European investors is emerging and more US talent is coming to the continent than going the other way. Here are a few takeaways:

• On current trajectory, by the end of 2023 just $45bn will have been pumped into European startups — a drop of more than half the $100bn that was invested in 2021.
• It's also been a sobering year for $1bn valuations. Just seven unicorns have been created in 2023 to the end of October, down from 48 in 2022 and 108 in 2021.

That said, the situation at the earliest stages is less gloomy.

• Early-stage companies raised $13.7bn in the first three quarters of this year. Annualised, that figure rises to $18.3bn — a not-so-significant fall from the $20.6bn invested in 2022.
• And while the rate that founders are starting new companies has fallen 30% since its peak in 2020, there are more first-time founders in Europe than there are in the US.

The figures also show the ecosystem still has far to go in terms of diversity.

• Just 7% of European funding rounds went to all-women founding teams in the first nine months of 2023.
• And those same teams raised just 3% of total capital — compared to 82% for all-male teams.

💰 New Renaissance Ventures announces €6m pre-close of €20m microfund to back startups in the creative industries. Former Speedinvest VC Severin Zugmayer and Munich-based Signals’ principal Michael Mayboeck are behind the fund, which will back startups in the creative and cultural industries with a tech angle (like Spotify, Figma and Canva). It plans to raise the full €20m by Q3 of 2024. 

🤝 VC fund Molten Ventures is set to snap up Forward Partners for £41.4m.

🧬 GenAI biotech Cradle raises $24m Series A. The Dutch startup, which speeds up research and development for protein-based drugs, saw its round led by Index Ventures. Kindred Capital and angel investors also participated. 

☁️ "We believe that we can build a better cloud [than AWS and Google]” — just months after pledging to raise €3bn in two years, Swedish startup Evroc has shared plans to raise €600m for its flagship hyperscale cloud centre. The round will be a combination of venture capital, debt and grants.

• The startup intends to create a green rival to Amazon Web Services (AWS), and wants to provide the largest AI infrastructure in Europe to help clients that cannot use other US-based services because of security concerns.

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🤦‍♀️ "Do you think you'll lose interest in the business once you've had your baby?" — female founders are up against bleak stats when it comes to raising venture funding, and according to a new survey by VC Antler, they’re still fielding sexist questions from male European angels and VCs.  

♻️ Inside the wave of European operators swapping fintech for climate tech.

Are you a female-led SaaS European startup who is currently fundraising? If you'd like to participate in Sifted's pitch event — and get your business seen by some of Europe's leading investors — share your pitch deck with us before tomorrow!

London-based PhysicsX, which is using generative AI to simulate physics and create engineering designs, raised €32m in Series A funding. General Catalyst led the round.

Milan-based WeRoad, a group travel platform, raised €18m in Series B funding. Italian family office H14 led the round.

Cambridge-based Secondmind, which uses machine learning to help automotive engineers design better cars, raised $16m. Investors included Mazda.

Paris-based WeeFin, a SaaS platform helping financial institutions understand and comply with ESG regulations, raised €7m in Series A funding. Investors included IRIS and Ring Capital.

Munich-based Quantum Diamonds, which develops quantum sensors for semiconductors, manufacturing and medical diagnostics, raised €7m in seed funding. IQ Capital and Earlybird led the round.

London-based Hybr, which aggregates all available homes for first-time renters, raised £3.2m in seed funding. Investors included BlackWood Ventures.

Paris-based Waltio, a crypto tax assistant for individuals, raised €1.8m. Investors included Crédit Agricole Capital Développement.

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