Analyses Made Easy
Pitchbook’s Reports on European VC and M&A*
*All graphs and figures are derived directly from the reports themselves.
Despite poor macroeconomic signals, European VC has shown relatively few signs of a radical slowdown. 2020 has seen $38.4b (€29.5b) invested over 4,646 deals so far, which was boosted by the $12.5b (€10.6b) in Q3 2020. That puts it on pace to surpass the $43.9b (€37.2b) deployed in 2019 (see graph). Deals with U.S. investor participation reached $19.1b (€16.1b) so far this year, continuing an upward trajectory for transatlantic investment, which reached a new high of $22.6B (€19.1) over 1,099 deals in 2019.
93.4% of European VC in 2020 through Q3 went to follow-on rounds, marking a continued divergence between late-stage and first-time fundings. As late-stage fundings increased in volume, this discrepancy is set to reach its highest degree in a decade if the current pace is kept (see graph left). Meanwhile, software lost some ground as the most popular area for investment, though it still maintained its status as the largest single segment with almost $11.8b (€10b) raised so far in 2020 (see graph right). The analysts expect further growth of investor interest for pharma and biotech startups, particularly as the race for a COVID-19 vaccine persists.
Exits in 2020 so far have a total reported value of $11b (€9.3) over 472 deals. That the total deal value is expected to reach $11.8b (€10b) for the eighth year in a row was all but certain until the recovery in Q3 2020. While France and the Benelux (Belgium, Netherlands, Luxembourg) countries have seen a dampening of exit activity, the DACH region (Germany, Austria, Switzerland) saw strong numbers (see graph left), driven in no small part by the CureVac IPO, the largest Q3 2020 exit. While the overall exit landscape looks healthy, the value brought in by M&A appears relatively low (see graph right).
The median M&A deal size remained fairly stable so far in 2020 at $23.9m (€20.2m), while the average deal continued its climb to $415.4m (€351.7m) (see graph left). Most notably, cross-border M&A deals activity fell sharply in Q3 2020: 550 deals were closed, worth a combined $81.7b (€81.7b), a YoY decrease of 41.9% and 52.2%, respectively. This is a new quarterly low for the decade. IT firms grew as a percentage of total deals in Q3 2020, reaching their highest share to-date at almost 25% (see graph right). This is due to their perceived low risk, according to the analysts.
Finally, new fundraising activity remained strong with $13.1b raised so far in 2020, well above the pace set by 2019. Funds with less than $59m (€50m) continued to fall as a percentage of all funds (see graph left). First-time funds pulled in $1.8b (€1.5b) over 21 new vehicles (see graph right). This is already well above 2019’s figures, though not on pace to beat 2016’s record-setting $3.3b (€2.8b) raised over 30 new funds.
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Today's Funding 💸
- Solv (San Francisco, Calif.), doctor network provider: $27m B+ led by Acrew Capital, participation from MultiCare Health System, Light Street Capital, Benchmark, Greylock Partners.
- Synendos Therapeutics (Basel, Switzerland), small molecules aimed at restoring the natural functioning of the endocannabinoid system: $21.9m (CHF20M) A led by Kurma Partners, Sunstone Life Science Ventures, participation from BERNINA BioInvest, Schroder Adveq, High-Tech Gründerfonds, Lichtsteiner Foundation, Essential Investments, Zürcher Kantonalbank, et al.
- Bond Vet (New York, N.Y.), online bookable veterinary clinics: $17m A led by Talisman Capital Partners.
- Knopp Biosciences (Pittsburgh, Pa.), drug discovery and development platform: $14m C led by Solas BioVentures.
- X-Cor Therapeutics (Allston, Mass.), novel extracorporeal carbon dioxide removal device: $2.6m Seed led by Alira Health Ventures.
- Adaptilians (Boston, Mass.), intraocular lens: $1.6m Seed led by Pillar VC, participation from Accanto Partners.
- Klovechef (New York, N.Y.), interactive cooking platform: $1m Pre-A from JPIN VCATs, Ravindranath Chenna, SOSV, NB Ventures, Alok Nanavaty, Kanwar Chadha, Rajiv Nayan, Hans Black.
- Menlo Security (Mountain View, Calif.), SaaS cloud security platform: $100m E led by Vista Equity Partners, participation from Neuberger Berman funds, General Catalyst, JP Morgan, et al. The company was valued at $800M.
- Tehtris (Paris, France), platform against cyber espionage: $23.6m (€20m) led by Ace Management.
- Trovares (Seattle, Wash.), graph analytics platform: $1.35m from Rich Padden.
- Nana (Oakland, Calif.), platform to teach people how to do repair work, combined with a repair service marketplace: $6m Seed from Spero Ventures, Next Play Ventures, Lachy Groom, Scott Belsky, Geoff Donaker, Michael Staton.
- ThoughtExchange (Vancouver, Canada), mission-critical conversation scaling platform: $34m from HarbourVest Partners.
- Livestorm (Paris, France), mobile/desktop video communications platform for meetings or webinars: $30m B led by Aglaé Ventures, Bpifrance Digital Venture, participation from Raise Ventures, IDInvest.
- GuideCX (Salt Lake City, Utah), platform to onboard new customers: $10m A led by Sorenson Ventures, participation from Epic Ventures, Orchard Ventures, Album VC, Prelude, et al.
- InFeedo (Gurgaon, India), employee satisfaction measurement platform: $3.2M A led by Bling Capital.
- Reprise (Boston, Mass.), demo creation platform: $3.2M Seed led by Glasswing Ventures, Accomplice Ventures.
- OthersideAI (Syracuse, N.Y.), AI-powered email inbox productivity solution: $2.6m Seed led by Madrona Venture Group, participation from Active Capital, Hustle Fund, Chapter One, et al.
- Railsbank (London, U.K.), Banking-as-a-Service platform: $37m led by MiddleGame Ventures, Ventura Capital, participation from Railsbank, Anthos Capital, Global Brain, Clocktower Technology Ventures, Moneta VC, Mitsui Fudosan, Firestartr.
- Truebill (San Francisco, Calif.), personal finance management platform: $17m C led by Bessemer Venture Partners, participation from Eldridge Capital, Cota Capital, Firebolt Ventures, Day One Ventures.
- AlphaFlow (San Francisco, Calif.), online platform for investing in real estate debt: $10m A led by Saluda Grade Ventures, participation from Y Combinator, 10X Capital, Resolute Ventures, Upside Partnership, Vishal Garg, et al.
- FinPay Holdings (King of Prussia, Pa.), patient financial management platform: $5m C led by Montreux Growth Partners.
- AppBrilliance (Austin, Texas), payment platform: $3m Seed from undisclosed sources.
- Kate Farms (Santa Barbara, Calif.), plant-based nutrition for healthcare: $51m B led by Goldman Sachs, participation from Kaiser Permanente Ventures, et al.
- Statespace (New York, N.Y.), training platform for gamers: $29m B led by Khosla Ventures.
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