A sufficient supply of growth capital is a prerequisite for a startup's rapid rise to unicorn status. However, in Europe, the demand for capital still exceeds supply. As a result, the share of domestic investors in later financing rounds is declining, particularly in German-speaking countries. While around 67 percent of capital in the early stages still comes from domestic investors, the share shrinks to around 12 percent in later financing rounds. European innovations are thus being sold outside of Europe in relatively early stages of company development. At least in the crisis year, VC investments in Europe have not shrunk and remain at €38 billion.
More capital not only for unicorn startups
“We must manage to mobilise further capital in Germany in order to close the financing gap in the late phase up to a possible IPO,”
says Peter Fricke, Head of the Deutsche Börse Venture NetworksThis is an important first step to enable growth companies to better utilize the opportunities offered by the domestic capital market.
"To be attractive to promising startups in their own country, the European venture capital market and its framework must adapt even more closely to the needs of young growth companies. Only in this way can we fully exploit the great potential and create European tech champions that will also go public in Europe and secure a strong, sustainable European business location."
Fricke continued.
