The venture slowdown has long been established to be a global phenomenon, and per a new report from VC firm Atomico, this “adjusted market reality is here to stay.”
Based on Dealroom and Crunchbase data, Atomico predicts that if things stay the same, the amount of capital invested in European startups this year will be 52% lower than in 2021.
That’s a clear decline, but it isn’t much worse than what we are tracking in other major regions.
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Many of the same problems present in the United States are also showing up in Europe, such as infrequent exits and a dead IPO market. But we already knew that.
So, instead let’s look at recent European venture capital totals and see if there is cause for optimism despite yet another decline in anticipated funding levels.
The bad news isn’t actually that bad
Atomico reports that European tech investment volumes are tracking at around half of 2021, set to reach $51 billion in 2023, compared to $106 billion two years ago.
But that comparison isn’t that useful given 2021 was such a big outlier. We’re more interested in how 2023 will compare to years when the funding climate wasn’t so inflated.