Funding down and valuations flat in Q1 for European startups

It was a difficult start to 2023 for European startups. In the first quarter of the year deal closing slowed, valuations flattened and exits remained subdued, according to new research.

Analysts of PitchBooka financial data company, found that investor priorities have shifted from growth at all costs to profitability.

Following a boom in VC activity that seeped into early 2022, reports have emerged of slower growth rates, headcount cuts and tighter financing conditions. As a result, due diligence processes have become longer, with earnings, valuations and runways under heightened scrutiny.

Nalin Patel, the report’s author, noted that investors have become more selective across the board.

“We are seeing declines across funding stages, sectors and regions,” Patel told TNW.

Tickets are officially 80% sold out

Don’t miss your chance to be part of Europe’s leading technical event

Deal value and number of unicorns decreased by 87.5% and 65.5% respectively from Q1 2022