Despite a lackluster year for VC dealmaking, European startups that raised capital in 2024 received more money and at higher valuations than before.
Here are five charts from PitchBook’s 2024 Annual European VC Valuations Report detailing how price tags and deal sizes moved last year.
In contrast to 2023, when all stages declined or remained flat, median deal sizes swelled in 2024. The opposite ends of the spectrum—pre-seed and venture growth—saw the most significant increases from 2023.
Higher median deal values and falling dealmaking indicate a better quality of startups raising funds compared to previous years. Recovery in macro factors such as interest rates and inflation have also led to the closing of larger deals.
For the first time since 2021, median European pre-money valuations rose across all VC stages last year, reaching record heights for all but venture growth.
Similarly to deal sizes, pre-seed climbed the most, registering a 42% increase from 2023 to €3.7 million. Only late-stage saw single-digit growth, with 2024’s annual figure coming to €11.9 million compared to €10.9 million in 2023.
While startups are raising more capital at higher valuations, closing a round is taking longer than ever before for all but pre-seed startups.
For early-stage companies, the median time between rounds has risen to 1.4 years compared to 1.2 a decade ago. Over the same timeframe, late-stage startups are taking 2.1 years to raise a new round—10.5% longer than in 2014.
This again points to a quality bias in Europe, with the best companies raising with relative ease. Those with weaker signals or in less desirable verticals struggle to attract funding.
After a sharp increase in 2023, the proportion of down rounds in Europe has leveled off, with a moderate decrease in 2024 to 18.1%. Their share of overall dealmaking is expected to drop going forward as valuations recover further.
Parts of Europe’s VC market have seen a higher rate of valuation cuts than others. Down rounds accounted for almost a quarter of Nordic deal count in 2024, with some high-profile failures, including Swedish battery maker Northvolt’s bankruptcy filing in November.
The median VC-backed exit valuation rebounded to €34.4 million last year—its second-highest annual figure in a decade.
Buyout exit valuations were the main driver behind the increase. The strategy’s median more than tripled from 2023 to €61.3 billion. Acquisitions registered a slight increase, while the median for public listings declined further to just €14 million—less than a third of 2021’s €50.9 million record.
Recovery of European IPOs is highly anticipated in 2025, and valuations for public listings are expected to improve as the window opens.
Featured image by Eoneren/Getty Images
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