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European VC Valuations Report

Q1 2022

European VC Valuations Report

May 16, 2022

VC valuations soar, but impact of macroeconomic disruptions remains to be seen

European VC pre-money valuations across all financing stages continued their upward trajectory in Q1, pacing above the highs of 2021. This was in sharp contrast to exit value, which dropped drastically during the quarter—a trend that could affect valuations later in the year. Meanwhile, macroeconomic activity such as rising interest rates, inflationary pressures, and trade tensions have caused 2022 to be characterized by uncertainty.

Our Q1 2022 European VC Valuations Report breaks down the region’s activity, providing an extensive look at valuations across stages, sectors, geographies, and more.

Key takeaways

  • Software companies disrupting verticals such as food delivery, ecommerce, and financial services have seen great success over the past two years, as consumers pivot to online models. The median early-stage software pre-money valuation hit €12.2 million in Q1, up 50.8% from 2021’s full-year figure.
  • Angel, seed, and early-stage valuations in the UK and Ireland are sitting above 2021’s records, but late-stage valuations are slightly down from last year. Strong deal value figures in the quarter indicate that the Bank of England’s recent interest rate increases have not stopped capital flows into VC.
  • VC deals with nontraditional investor participation had a strong Q1 when it came to deal value and count, and median VC deal sizes across all financing stages are pacing above 2021’s highs.
  • Q1 recorded 153 existing Europe-based unicorns, a 21.4% jump from 2021’s cumulative figures, and 28 new unicorns were minted during the quarter.

Table of contents
Introduction 3
Overview 4
Sectors 10
Regions 12
Nontraditional investors 14
Unicorns 16
Liquidity 18