A new report from Antler highlights a growing disparity in the European venture capital market. While the region has seen the emergence of 33 rocketship unicorns founded since 2020, which reach valuation status in an average of two years, the early-stage funding pipeline is facing a significant contraction.
Data shows that since 2021, deal volumes for pre-seed, seed, and Series A rounds have declined by 38, 41, and 45 percent respectively. The conversion rate from seed to Series A has dropped from 23.3 percent in the 2008–2019 period to 9.3 percent in 2023, meaning fewer than one in ten startups successfully secure Series A funding.
The report attributes this trend to a sharp decrease in active investors. Since 2022, the number of investors participating in pre-seed and seed deals has fallen by 42 percent, while Series A investor participation has dropped by 44.7 percent. New investor entry into the early-stage market has also declined by 45.2 percent.
Antler identifies two types of unicorns: capital-efficient Jets and capital-intensive Juggernauts. London currently hosts 43 percent of these companies. To restore the seed-to-Series A conversion rate to 23.3 percent, the firm estimates a required investment of $2.74 billion, which could generate three additional unicorns annually.
