The document summarizes key findings from the 2016 European Venture Capital Report by Dealroom.co. It finds that venture capital funding in Europe reached a record €16.2 billion in 2016, up 12% from 2015. However, funding slowed in the UK and Germany, while most other countries saw strong growth. The number of early stage startups also increased but fewer reached later funding rounds, likely due to more competition. Average deal sizes decreased in 2016 after increasing in prior years. Corporate investment in startups continued rising significantly.

1. 2016 European Venture Capital Report
January 2017

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captures more venture capital activity
than any other data provider in
Europe.

5. Record € 16.2B venture capital raised by European
companies in 2016. Funding up 12%, rounds up 32%
5
€ 4.2M
€ 4.9M
€ 10.1M
€ 14.4M
€ 16.2M
1,290
1,853
2,120
2,566
3,376
2012 2013 2014 2015 2016
Amount raised (€ M) Top 8 rounds (€ M) Number of rounds
Top-8
rounds
(+32%)
(+12%)
Source: Dealroom.co. Includes Israel. Excludes private equity, M&A and buyouts. More data on: https://app.dealroom.co/markets/countries/funding

6. € 1.3B € 1.3B
€ 3.2B
€ 3.8B
€ 3.2B
€ 0.6B € 0.6B
€ 2.0B
€ 2.9B
€ 2.0B
€ 0.5B
€ 0.6B
€ 0.8B
€ 1.5B
€ 2.7B
€ 0.5B € 0.5B
€ 1.2B
€ 1.8B
€ 2.7B
€ 0.2B
€ 0.3B
€ 0.5B
€ 1.0B
€ 1.6B
€ 1.1B
€ 1.6B
€ 2.4B
€ 3.4B
€ 4.0B
410
542
644
545 520
165
245
288
353
380
118
167 180
243
590
88
132
166
241 231
57 42
82
163
366
452
725
760
1,021
1,289
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016
United Kingdom Germany France Israel Sweden Other
Amount raised (€ billion) Number of rounds
Slowdown in UK and Germany, but strong growth
across most parts of Europe
6Source: Dealroom.co. Includes Israel. Excludes private equity, M&A and buyouts. More data on: https://app.dealroom.co/markets/countries/funding

7. UK & Germany: 43% drop in B2C funding. Many B2C
markets adequately funded, focus on execution.
7Source: Dealroom.co. More info: https://app.dealroom.co/funding-rounds/f/locations/anyof_Germany_United%20Kingdom
B2C
(UK & Germany only)
B2B
(UK & Germany only)
€ 0.7B € 0.7B
€ 1.8B
€ 1.6B € 1.6B
€ 0.5B € 0.5B
€ 1.1B
€ 2.2B
€ 1.3B
€ 0.2B € 0.3B
€ 0.4B € 0.8B
€ 0.6B
€ 0.3B € 0.3B
€ 1.6B
€ 2.4B
€ 1.3B
€ 1.0B € 1.0B
€ 2.2B
€ 2.4B
€ 2.2B
€ 0.8B € 0.8B
€ 2.6B
€ 4.6B
€ 2.6B
277
366
431 423
497
255
359
413
406
336
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016
Business Consumer
UK Amount raised (€ billion) Germany Amount raised (€ billion) Number of rounds

8. Largest ever European cohort of early stage startups
8
€ 0.3B
€ 0.5B € 0.6B
€ 0.9B
€ 1.2B
€ 0.9B
€ 1.3B
€ 1.7B
€ 2.7B
€ 3.8B
€ 1.1B
€ 1.4B
€ 2.7B
€ 3.7B
€ 4.0B
€ 1.5B
€ 1.1B
€ 3.8B
€ 6.3B
€ 5.4B
€ 0.4B
€ 0.6B
€ 1.4B
€ 1.6B
€ 1.7B
621
967 996
1,301
1,748
245
317
378
567
879
104 129
173
215
266
60 50
89
178 198
260
390
484
305 285
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016
Angel & Seed Series A / Early VC Series B, C Series D+ Other
Amount raised (€ billion) Number of rounds
Early stage Later stage
Source: Dealroom.co. More info: https://app.dealroom.co/funding-rounds/f/rounds/anyof_SEED_SERIES%20A_SERIES%20B_SERIES%20C

9. 31%
16%
9%
5%
21%
8%
–
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Seed Series A Series B Series C Series D
2009 cohort 2010 cohort 2011 cohort 2012 cohort 2013 cohort% of startups reaching next funding round
Fewer startups (%) are reaching the next funding
round stage (to an extend this should be expected)
Note: the average time between rounds is roughly 18 months. Therefore, it takes an average of nearly three years to move from Seed to Series B. For this reason, the data only includes cohorts from 2013 and earlier.
COHORT SEED SERIES A SERIES B SERIES C SERIES D
2009 100% 33% 16% 7% 4%
2010 100% 31% 16% 9% 5%
2011 100% 22% 12% 3%
2012 100% 22% 9%
2013 100% 21% 8%
 Recent years saw more European than
ever startups, but a smaller proportion
reaching the next funding round stage
 This is likely due to a combination of
increased competition and higher risk
appetite by VCs
 Not reaching series-A does not necessarily
equal failure. Reasons may be that
company became profitable
 Especially beyond series-A/B companies
often do not need additional funding
About 20-30% of
seeded companies also
do series-A round.
Thereafter, follow-on
rate is about half for
each stage
9Source: Dealroom.co.

10. Round sizes have come back down in 2016, which
indicates that valuations have probably as well
10Source: Dealroom.co.
€ 0.5M
€ 0.5M
€ 0.6M
€ 0.7M € 0.7M
€ 0.1M
€ 0.2M
€ 0.3M
€ 0.3M
€ 0.4M
2012 2013 2014 2015 2016
Average
Median
Series C rounds
Seed rounds Series A rounds
€ 3.7M
€ 4.5M
€ 5.0M
€ 5.7M
€ 5.4M
€ 2.5M € 2.5M
€ 3.6M € 3.6M € 3.6M
2012 2013 2014 2015 2016
Average
Median
€ 7.8M
€ 9.2M
€ 13.5M € 13.4M
€ 11.8M
€ 5.6M € 5.9M
€ 8.2M
€ 10.0M
€ 9.1M
2012 2013 2014 2015 2016
Average
Median
€ 15.9M
€ 13.5M
€ 21.1M
€ 26.3M
€ 23.1M
€ 10.9M € 10.0M
€ 17.0M
€ 19.1M € 18.2M
2012 2013 2014 2015 2016
Average
Median
Series B rounds

11. Corporate investment activity continued its rise, both
via corporate venturing and balance sheet investing
11
1. Total gross amount raised in rounds with corporate involvement.
Source: Dealroom.co. Rocket Internet is not counted here as corporate investor. More info: https://app.dealroom.co/investors/f/investor_type/anyof_corporate%20venture%20fund_corporate
Corporate investing by number of rounds Corporate investing by € amount funded (1)
69
104
160
314
545
5.3% 5.6%
7.5%
12.2%
16.1%
2012 2013 2014 2015 2016
Corporate venture fund
Corporate direct
% of total European rounds
€ 0.6B
€ 0.8B
€ 1.3B
€ 3.7B
€ 4.9B
15.1%
16.0%
13.4%
25.4%
30.0%
2012 2013 2014 2015 2016
Corporate venture fund
Corporate direct
% of total European rounds
30% of corporate
investors are U.S. based
(while only 13% of fund
investors are U.S.
based). The share of
European corporate
deals is rapidly
increasing though.

12. €9.7 billion (1) in new capital raised by European VCs
in 2016 (+50%) which may fuel 2017 and beyond
121. Source: Yannick Roux, Atomico, InvestEurope.
50% growth in new
capital raised by
European VCs
In 2016, U.S. funds invested
roughly €3.6 billion into
European VC rounds. U.S.
consistently contribute
about 20-25% of total
European VC.
Growth funds
increasingly
participate in large
venture rounds
Corporate investing is
rapidly on the
increase
(see next slide)
Combined with existing funds,
more than enough to support
investment levels similar to or
higher than 2016 of €16.2
billion
€ 6.3B
€ 9.7B
~ € 4B
X
Y € 18B
€ 16B+
2015 2016 U.S. Funds Growth funds Corporate investing Indicative 2016 funding
Capital raised from LPs by European funds Other sources available firepower deployed

13. € 3.2B
€ 2.7B
€ 2.7B
€ 2.0B
€ 1.6B
€ 0.6B
€ 0.4B
€ 0.4B
€ 0.3B
€ 0.3B
€ 0.2B
€ 0.2B
€ 0.2B
€ 0.1B
€ 0.1B
€ 0.0B
€ 0.0B
USA
United Kingdom
France
Israel
Germany
Sweden
Spain
Netherlands
Ireland
Finland
Russia
Belgium
Italy
Norway
Denmark
Austria
Portugal
Turkey
How much headroom is there still in European VC?
Funding per capita indicates there is still room
131) USA data is a Dealroom estimate based on CB Insights and PitchBook data.
Source: Dealroom.co.
325M
147M
82M
79M
67M
65M
61M
47M
17M
11M
10M
10M
9M
9M
6M
6M
5M
5M
USA
Russia
Germany
Turkey
France
United Kingdom
Italy
Spain
Netherlands
Belgium
Portugal
Sweden
Austria
Israel
Denmark
Finland
Norway
Ireland
Population = VC funding per capita÷ 2016 VC funding
€ 70-75B (1) // € 313
€ 231
€ 160
€ 77
€ 59
€ 49
€ 41
€ 30
€ 25
€ 24
€ 24
€ 22
€ 13
€ 9.2
€ 4.3
€ 2.7
€ 2.0
€ 0.4
Israel
USA
Sweden
Ireland
Finland
United Kingdom
France
Norway
Denmark
Germany
Netherlands
Belgium
Spain
Austria
Portugal
Italy
Russia
Turkey