European Venture Capitals Closed €3.3 Billion in Fourth Quarter 2015
In the fourth quarter of 2015, European venture capital raise €1.33 billion ($1.45 billion) to close €3.3 billion ($3.59 billion) funding in the quarter. United Kingdom still hold the top spot for venture capital funding and information technology companies are still favorite.
According to Crowd Fund Insider, quoting the latest Dow Jones Venture Capital Report, there is a 58% hike from European venture capital fund. Overall, European VC raised €3.3 billion in 426 deals during Q4 of 2015. Compared to last year, there is a 6% increase in the same quarter while a number of deal dropped by 30%.
Tech startup companies in the information technology sectors still won the favor of the investors with 107 deals in total €840 million funding. As for the location, United Kingdom is still favorite and hotspot for venture funding, with 43% of total funding in Europe was closed in UK. Germany was in the second place with 21%, while France and Switzerland took the third and fourth place.
According to PR Newswire, the Venture Pulse report showed European startups fared better than North American counterparts. The fourth quarter marked a strong quarter for European VC-backed companies with 338 deals.
The report which was published KPMG in cooperation with CB Insight showed a similar trend in the global venture capital funding. Nevertheless, different than Dow Jones data, the Venture Pulse showed a slight decline in European VC-funding from $3.5 billion in previous quarter to only $3 billion. However, European venture capital firms have taken a less risky approach starting the 2015 as the report said, "VC investors in Europe having already shifted to a more conservative investment approach – a shift only now starting to be felt elsewhere."
European firms and investors took more conservative approach in order to give more focus on companies that can substantiate their business model and show progress toward value creation. As a result to this approach, valuations in Europe remain substantially lower than in Asia and North America.
In total, according to Venture Beat, venture capitalists invested $128 billion worldwide in 2015, a 44% increase from 2014 with only $89 million. This number is recorded as the biggest amount since the dotcom bubble in 2000.
Quoting Venture Pulse Report, "What sets 2015 apart, however, lies in the size and scope of the venture capital investments that were made. From healthcare to FinTech, and retail to education, companies sparked changes that could affect every sector and every business moving forward. Investors saw this potential and made significant investments."
With a closing number of € 3.3 billion ($3.59 billion) in Q4, the year 2015 showed an increase of venture capital investment in Europe. However, investors have taken a more conservative approach for upcoming year.