European Space Policy Institute (ESPI)’s Post

✍️𝐃𝐞𝐞𝐩𝐭𝐞𝐜𝐡 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭: 𝐓𝐫𝐞𝐧𝐝𝐬 𝐚𝐧𝐝 𝐒𝐭𝐫𝐚𝐭𝐞𝐠𝐢𝐞𝐬📈 Nowadays, I spend a good deal of time with EIC Accelerator matters and its balance of grant vs. equity. This balance reflects the crucial role of both public and private funding in deeptech investment strategies. Today, there is as much public funding available for deeptech ventures as there is private investment. Leveraging both effectively can significantly boost the sustainability and growth of deeptech startups, especially in their formative years. European deeptech startups are well aware of the EIC Accelerator's role in providing significant funding to drive innovation. What might be less understood is the variety of public funding: grants, subsidies, loans, tax incentives, and public procurement, all essential for early-stage R&D. Having participated in the investment and funding of many deeptech startups across various fields, I've seen firsthand how high-quality research validates innovations and enhances credibility with investors. Deeptech startups, known for their cutting-edge research, must leverage this strength to attract and secure funding. 𝐒𝐭𝐫𝐚𝐭𝐞𝐠𝐢𝐞𝐬 𝐟𝐨𝐫 𝐃𝐞𝐞𝐩𝐭𝐞𝐜𝐡 • Hybrid Funding Models: Combine public grants with private investment to reduce risks and maximize innovation potential. • Focus on High-Impact Research: Invest in startups with strong research capabilities and potential for high-impact innovations. • Explore Public Funding Opportunities: Encourage portfolio companies to seek and apply for public funding to support early stages and reduce financial burdens. Be aware that there is a variety of public funding: grants, subsidies, loans, tax incentives, and public procurement, all essential for early-stage R&D. • Collaborate with Public Entities: Foster collaborations to create a synergistic funding environment, for better resource allocation and support for innovative projects. By strategically navigating the funding landscape and combining public and private investments, deeptech startups can achieve sustained growth and drive technological breakthroughs. #DeepTech #Innovation #VentureCapital #PublicFunding #TechInvestments #FutureTech

2023 was another challenging year for founders, with many of the 2022 macro challenges persisting. • Difficult Fundraising Environment Founder sentiment about fundraising conditions over the past 12 months is grim. 80% of founder respondents to the State of European Tech survey (https://lnkd.in/dS5wwJhW) say that it has become even harder to raise venture capital. Just 7% of respondents stated that conditions had eased. • Round Volumes Drifting Back To Pre-2021 Levels The investment activity has decelerated, which is reflected in a decreased count of disclosed investment rounds. Rounds involving investment amounts of $5M or less continue to represent the overwhelming majority of all activity, equating to 73% of all rounds in 2023. Over the past three years, $5M+ rounds have accounted for around 24-27% of all activity. A decade ago in 2014, that share stood at just over one-tenth (11%). • Adjusting Expectations Most founders highlighted the impact of challenging fundraising conditions on most aspects of their process. The most notable impacts cited were extended process timelines, the need to lower valuation expectations, reducing round sizes or taking more dilution than hoped. • The Average Time Between Rounds Is The Same Companies that have had to elongate the time between their funding rounds have yet to come back to the market to raise capital in sufficient volume to impact the overall numbers. As of Q3 2023, the median time between rounds for growth-stage companies has remained an average of 23 months between consecutive rounds. • An Upward Trend in Bridge Rounds 2023 saw the highest share of bridge rounds across all stages globally since 2019. Bridge rounds are more common at the earliest stages of a startup's fundraising journey when they serve to buy more time to find product-market fit. This is also reflected in the data, with Seed stage (38%) and Series A (39%) seeing the highest share of extension rounds in 2023. • Round Sizes on the Rise Round sizes are back in line with the longer-term, 5-10 year averages for the growth stages. At Seed and Series A, median round sizes have also seen a period of stabilisation following rapid increases during 2020 and 2021, but remain elevated at levels significantly above 5-10 year averages. Growth stage founders have to achieve more with less capital for an extended period, despite the ongoing inflationary pressures on wages that elevate talent costs. --------- QLA is a media-tech-enabled consulting company. Want access to exclusive dealflow? More info: https://qla.fund

Newest VER blog discusses “Innovations in Europe”. Clearly more innovations are made in the United States than in Europe. As it is, US technological giants lead the tech race, the venture capital market is stronger and tech IPOs take place in the United States. From the standpoint of an institutional investor, European innovations have not for a long time been as attractive investments as in the United States. According to the latest statistics, European venture capital funds have outperformed US funds over the past 10 years, returning over 20 percent per annum according to Invest Europe assocation. This fact can be used to create a roadmap for to increase the attractiveness of European growth companies from institutional investor perspective at the various stages of development. A pre-condition for a sound market is a multi-tiered, highly functional capital market infrastructure. Innovation market infrastructure is a chain of layers which consist of stock exchange and equity market, benchmark indices and investment products by which investors are attracted to invest. The good investment returns are the solid basis for interest. Link to newest VER blog “Innovations in Europe”: https://lnkd.in/dgCkzU5T)

Thanks for the insights Timo Löyttyniemi 🙏 My take: this comes down to fragmented European market both for stock exchanges and capital markets compared to super-aggregating US ones. Thanks for pointing out the BlackRock-Preqin deal. Like Nasdaq FirstNorth, perhaps they could be convinced to have ”First North private markets” for Nordics, since we at least try to generate solid capital markets compared to rest of Europe. The problem of Finland is lack of private capital, largely due to our high taxation approach and inheritance taxes, which are clear deviations to OECD.

Great news! The Angel CoFund website is now available in English!💫 The Angel CoFund (Kanssasijoitusrahasto) website is now fully accessible also in English! Explore the new website at www.angelcofund.fi What is Angel CoFund? Angel CoFund, also known as Kanssasijoitusrahasto in Finnish, is a €30 million fund dedicated to seeding the growth of Finnish startups in collaboration with angel investor groups. The fund strives to make a substantial impact on the early-stage investment landscape in Finland, fostering a more expansive and diverse Nordic investment ecosystem while providing enhanced funding opportunities for promising early-stage companies. Some key features of the fund:   👉 Capital invested by Business Finland Venture Capital 👉 Collaborative investments with groups of angel investors 👉 A goal to invest in approximately a hundred Finnish seed-stage companies 👉 Initial investments ranging from €50,000 to €300,000, aligning with the investment amounts of angel investor groups in the first round 👉 Can make investments across various industries, but with primary focus on companies promoting green transition and sustainable development   For more details, visit: https://lnkd.in/dXZsGfd9 #venturecapital

Some great news for the Swiss start-up community before Christmas! The European Commission will be fully activating the transitional arrangement as of 1 January 2025, which enables researchers and innovators in Switzerland to participate in almost all calls for proposals of Horizon Europe from the 2025 programme year onwards. This includes notably the EIC Accelerator. Activation of the transitional arrangement will allow Swiss companies to submit full proposals to the EIC Accelerator as of the 2025 calls for proposals. The EIC Accelerator offers grant awards up to €2.5 million complemented by equity of up to €10 million. The next cut-off for full proposals is on 12 March 2025.   Swiss companies will also be able to submit proposals for the new STEP Scale-up call for follow-on EIC Fund equity investments of between €10 million and €30 million. See details of the work programme here below.   Note that in order to submit a full proposal to the EIC Accelerator, companies must first qualify by receiving a positive evaluation of a preliminary short proposal. If Swiss companies have not yet submitted the first step “short proposals” (which was already possible up to now, before the 2025 Transitional Arrangement), there is still time. Short applications are batched and sent for evaluation the first Tuesday of every month, and typically take at most 4 weeks to be evaluated. Interested companies should contact Euresearch for more information on participating in the EIC Accelerator, and how to prepare your proposals. Update: For full coverage of the new access to EU programmes and the EIC Accelerator in particular, see Startupticker.ch, in particular the latest piece: https://lnkd.in/e9i46UXj Many thanks to Stefan Kyora and the Startupticker team for keeping the ecosystem informed! Maria Anselmi, Christoph Falk, Regula Egli, Cristina Riesen, Luca Cruciato, Laetitia Philippe, Alexander Schlaepfer, Stephan Schuerer, Karim Maizar, Diego Braguglia, Myke Näf, Beat Schillig , Raphael Tobler, Regula Bleuler, Thomas Heimann, MSc, Thomas Dübendorfer, Simon Enderli, Joanne Sieber, Dario My, Frank Floessel, Joni Rakipi, Lukas Froesch, Alexandra Leemann, Katharina Füglister, Michael Sidler, Kiran Dallenbach, Bahaa R., Sal Matteis, Olivier Laplace, Julien Levallois,

The technology sector is leading the charge when it comes to investment in South Africa’s start-up ecosystem.

🌟 The 2024 SelectUSA Investment Summit is Next Week! 🌟 I’m thrilled to share that I will be actively participating in this year’s SelectUSA Investment Summit, representing US Expansion Partners. Here’s a glimpse of my agenda: 📅 **Monday, June 24th - 3:30 PM:** I’ll be leading a workshop on "Budgeting for US Expansion" following the always sold-out session by Daniel Glazer on "US Expansion & Fundraising". If you’re planning to expand your business into the US, this session is essential for understanding the financial aspects and ensuring your budgeting is on point. 📅 **Tuesday, June 25th:** I’ll be diving deep into "How to Target the Right Venture Capital in the U.S." This session is designed for startups aiming to raise capital and expand their operations in the US. We’ll cover: - Identifying and targeting the right VC firms - Finding the ideal partners - Securing personal introductions This session will also feature an insightful fireside chat with the incredible Shelly Kapoor Collins from Sway Ventures. Don’t miss out on this opportunity to gain actionable insights from a venture capital partner! Additionally, I’m honored to participate in the Select Global Women in Tech (SGWIT) programming and serve as a mentor for the 2024 SGWIT cohort. Empowering women in technology and supporting their growth is something I’m deeply passionate about. Looking forward to connecting with fellow industry leaders, innovators, and entrepreneurs. Let’s make this summit a memorable and impactful experience! #SelectUSA #InvestmentSummit #USExpansion #VentureCapital #WomenInTech #SGWIT #Networking #Budgeting

The state of European venture capital produced by Affinity.co presents that in 2023 the market presented not only falling valuations and growing liquidity needs but also a considerable decreasing number of European investors. Noticing on the more challenging landscape it can be seen that top firms adopted 3 strategies to distinguish themselves from the rest. 1. Act on data throughout the deal cycle - The use of different data tools and data sources enriches the deal cycle. "58%  of the firms with more than 50 employees use seven or more data sources to evaluate deals" 2. Being agile and adapting to changes quickly - "By monitoring changes in key metrics like network activity, deal success rates, and time-to-close, top firms can quantify what is or isn’t working and quickly change their strategies." 3. Focus on network growth - Given the significant increase of active founders in Europe (up 13% YoY in Q1 2024) VC's shifted from focusing on their existing relationships to investing in new relationships. "It paid off for top firms, who appeared to garner success in Q4 2023 by growing their networks."

🌟 Europe’s VC Investment in Impact-Driven Start-ups Doubled! 🌟 📈 In 2023, Europe’s venture capital investment in impact-driven start-ups surged from 18% to an impressive 37%, totaling a staggering €53 billion. 🚀 🌍 Nordic-Baltic Region Takes the Lead 🌍 🌱 The Nordic-Baltic region led the charge, with an impressive 61% of VC investments aligned with United Nations goals. Their total investment reached €7.9 billion, driving positive change across sectors. 🌎 🌿 Investing in Our Planet 🌿 💡 Climate tech received a significant boost, attracting €20 billion in investments. Innovations in renewable energy, carbon capture, and sustainable practices are shaping a greener future. 🌎🌱 🔬 Deep Tech: Fueling Innovation 🔬 🚀 Deep tech ventures secured €17 billion in investments. From AI breakthroughs to quantum computing, these technologies are revolutionizing industries and solving complex challenges. 🌟 🌎 Urgent Call to Action 🌎 🔑 Urgent action is needed to scale and mobilize institutional investment. Let’s address societal and environmental challenges together! 💪 #VCInvestment #ImpactStartups #SustainableFuture #ClimateTech #DeepTech #InvestmentGoals https://lnkd.in/dXuHAbyb