European startups have twice achieved unicorn status in 2021 compared to last year. Despite the negative effects of the ongoing COVID crisis, young companies from the Old Continent, including many crypto unicorns, have managed to attract a record high volume of VC capital.
European unicorns to collect €32.5 billion in 2021
This year alone, 23 companies in Europe and Israel have become unicorns (startup companies worth more than $1 billion), according to a report by the financial data and software firm, up from last year’s total of eight. pitch book. European startups have managed to attract €32.5 billion (about $39.3 billion) since the start of 2021. This year’s capital inflows could easily exceed the €37.6 billion raised throughout 2020.
In total, 20 companies are based in Europe, including several crypto startups. Most of these unicorns are in the UK, with London-headquartered Blockchain.com currently valued at $5.2 billion after securing $420 million in two funding rounds earlier this year.
Germany ranks second with digital wealth manager Scalable Capital, which was valued at $1.4 billion last week, more than $180 million led by Chinese tech giant Tencent. French crypto security startup Ledger became the latest to join the group last week with $380 million in new funding.
The old continent is now home to about 12% of the world’s unicorns with over 50 active companies, published data showed. The capital attracted by these entities has grown steadily over the past five years and the total is expected to reach a record high in 2021.
Period unicorn, a term used to describe startups valued at more than $1 billion, was coined in 2013 by venture capitalist and angel investor Eileen Lee. This shows the rarity of such successful ventures.
US Capital Raises Startup Valuations Across Europe
European Decacorns, or companies worth over $10 billion, have also done well this year. For example, Swedish fintech startup Klarna was valued at $31 billion in March, becoming the continent’s most valuable VC-backed firm. Klarna was already leading the board at $15 billion in September 2020, but was replaced by Checkout.com in January of this year, when the online payments company received a valuation of $15 billion, Pitchbook detailed.
According to the report’s authors, increasing participation of US investors has been a major factor in investment growth in Europe. Nearly half of Unicorn’s top 10 supporters, such as Accel and Insight Partners, are located across the pond. Pitchbook also emphasized:
US companies are actively targeting tech startups from Europe, which tend to have lower valuations than their US counterparts, offering more opportunities for higher growth rates.
The financial data firm believes the effects of a strong investment in Unicorn, based in Europe, could create an even bigger valuation in the future. “We expect growth in transatlantic capital flows to Europe and valuations will continue to strengthen,” said Nalin Patel, personal capital analyst at Pitchbook, as cash-rich U.S. investors seek new companies with strong potential, which can be recognized by the U.S. can be offered in the market.”
What are your hopes for the future of these European unicorns? Let us know in the comments section below.
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