How is technology doing in Europe in 2021?

La tecnologia in Europa: verso i 100 miliardi di dollari investiti thumbnail

How is technology in Europe?

Beyond startups, inventions, evolutions (and risks) of artificial intelligence, what is the overall trend?

Ce says so State of European Tech 2021, annual report just published. The report is a data analysis of the European technology industry which includes 45 countries. And it’s promoted by Atomico in partnership with Slush, the world’s largest startup community, with the support of Orrick, a leading technology law firm with a global presence, Silicon Valley Bank and investment management firm Baillie Gifford.

Let’s see the main data that emerged from the report.

Technology in Europe: around 100 billion dollars invested

Two main data emerging from the State of European Tech 2021.

The first tells us that in technology, Europe is preparing to reach 100 billion dollars invested in the current year alone. And early-stage investment levels are for the first time in step with those of the United States.

The second concerns Italy, which almost doubles the capitalization of the technology market, from 14.5 to 26.6 billion dollars. Thus climbing to tenth place in Europe.

The five key trends

The report indicating the state of technology in Europe in 2021 points to five key trends. Let’s see them one by one.

Europe as a global technological player

As we said, technology in Europe is about to cross the $ 100 billion mark in invested capital in just one year, almost 3 times the level reached in 2020. (Source: Dealroom).

The total number of tech companies climbing up to $ 1 billion in Europe has jumped from 223 last year to 321 this year.. (Sources: Dealroom, Atomico).

Early stage startups in Europe represent 33% of all capital invested globally. This makes Europe the second largest investment region, with a total of US $ 3.8 billion versus US $ 4.1 billion. (Source: Dealroom)

Results above projections

The results are outpacing projections in both the equity and private markets. Over the past 12 months, Europe has seen the value of the technology stock market rise by more than $ 750 billion and currently stands above $ 2 trillion.

Italy reached 26.6 billion (against 14.5 in 2020) and entered the top 10 countries by capitalization of the technology market. (Source: CapIQ).

There are currently 26 European tech companies with decacorn status (worth over $ 10 billion) compared to 12 in 2020. Adyen is now on track to be the first European tech company founded after 2000 to reach $ 100 billion, with a valuation peaking at $ 99 billion as of November 2021. (Source: Dealroom).

Planet Positive startups are gaining ground

Over the past five years, more than $ 31 billion has been invested in purpose-driven technology companies in Europe, which account for 15% of all lending and record a year-over-year increase of 57%. Purpose-driven companies indicate those realities that build a sustainable future for all by addressing one or more SDGs. (Source: Dealroom).

Planet Positive investments (i.e. of companies working to make sustainable use of the planet’s resources) obtained 11% of total funding in 2021, with the technology startups Clean Energy and Climate each taking 24% of all capital invested in “purpose-driven” technology companies in 2017-2021. (Source: Dealroom)

Access to finance and talent: two key challenges

When it comes to funding, Portugal stands out with 54% of respondents seeing funding as a particular challenge for European technology over the next 12 months.

20% of Italians and 29% of Spanish respondents also said that fundraising is still a challenge. (Fonte: State of European tech survey 2021).

Italy has the highest share of “migrant” founders. 64% of the founders surveyed worked for companies worth more than $ 1 billion outside of Italy, while Sweden and Germany have the lowest share. (Source: Dealroom)

Gender diversity in technology

Women and ethnic minorities still have much more difficulty raising capital than men and white people. (Fonte: State of European Tech survey 2021).

Despite the demonstrations that mixed and diversified teams perform better, they only got 9% of the capital raised in 2021. (source: Dealroom)

Based on Extend Ventures’ analysis of a sample of 4,684 tech companies based in Europe that have raised more than $ 2 million in total funding since January 1, 2020, only 0.7% of the total capital was raised by female founders black; 1.1% from black male founders; 22.7% from white women (Source: Extend Ventures).

While gender diversity in founding teams remains low across Europe, there are some variations between countries. Portugal has the lowest rate of all-male teams receiving funding (75%), while Ireland has the highest rate of all-female founding teams (10%). (Source: Dealroom).

The declarations of Atomico

Tom Wehemeier, partner of Atomico and co-author of the report, said: “Europe is experiencing a technological revolution with profound effects on economies, society and the environment, driven by two irreversible trends..

One, which is not just about Europe, is the relentless march of technology. The other is what we call the European tech flywheel – an incredibly strong set of foundations that include a deep talent pipeline, exceptionally strong founding teams and a healthy pool of investors at all levels – that brings out unicorns and creates value. with ever greater frequency and magnitude.

These two trends help the European technological ecosystem to flourish, even if the macro conditions were to change ”.

Sarah Guemouri, Senior Associate of Atomico and co-author of the report, added: “The market is also becoming more liquid, with the convergence of different types of investors and growing appetite from public markets..

Even in a conservative scenario, we expect, at the very least, that European technology will double over the next decade and increase in value by trillions of dollars. “