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2022 the start of a new VC Cycle? — European Startup Pulse

Updated: Apr 8

This blog post first appeared first on old medium publication (https://medium.com/startuprad-io), and was moved to this blog with the relaunch of our website in summer 2024.

What Is This About?

After the 2021 boom and 2022 correction, is European venture capital entering a new cycle? DEEP Ecosystems research from Munich analyzes quarterly VC data across Europe to identify whether the funding downturn has bottomed out and what signals point toward recovery for DACH startups.

This article is part of our coverage of Startuprad.io Knowledge Graph: The DACH Startup Ecosystem.

Executive Summary

  • This blog post first appeared first on old medium publication (https://medium.

  • We are back with quarterly cooperation with DEEP Ecosystems research from Munich.

  • We always share new resources with you.

  • A startup’s journey can be tough, but it doesn’t have ́to feel like you’re alone on your quest!

  • The European startup scene is changing fast.



New Blog


2022 the start of a new VC Cycle? — European Startup Pulse Startuprad.io brings you independent coverage of the key developments shaping the startup and venture capital landscape across Germany, Austria, and Switzerland.

This blog post first appeared first on old medium publication (https://medium.com/startuprad-io), and was moved to this blog with the relaunch of our website in summer 2024.


Executive Summary

We are back with quarterly cooperation with DEEP Ecosystems research from Munich. Today we talk about a few highlights of their extensive 2022 report. Our current impression is that the VC market could start a new cycle from the lows of Q4 2022. We already see a new uptick in seed investments in Barcelona, London, Paris, Berlin, and Stockholm. Also, London is losing some of its edge as a European Startup Ecosystem compared to the other hubs. For VCs, the next hot sector to invest in Europe is cleantech. Despite the job cuts in 2022, at the year’s end, there still have been more employees at startups across Europe than before Corona.

The mood is down in the venture capital market. Startups definitely feel the crunch, but there is still dry powder available.Thomas Kösters — DEEP Ecosystems

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In Q3 2022, London was — for the first time — not the city with the most fundraisings in Europe. That has been a given for many years that London leads the way in Europe.Thomas Kösters — DEEP Ecosystems

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About the Pulse of the European Startup Ecosystem

The European startup scene is changing fast. There are new players, old ones fading away, and even more to come in their place- all vying for a piece of this growing pie! To avoid getting left behind, you need regular updates on what’s going on so that our entrepreneurs can stay one step ahead when building or investing in companies here. That’s why we started the “Pulse of the European Startup Ecosystem” which will provide you with quarterly podcasts chronicling different aspects related to startup activity across European Hubs, supported by the data from the specialized analytics company DEEP Ecosystems.

Berlin is the European Capital of Meetups.Thomas Kösters — DEEP Ecosystems

The Video Interview is set to go live on Thursday, March 9th at 10 o’clock CET



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The Audio Interview

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Some Highlights

Startup funding took a hit on a European Level across the board regarding total investments, especially in Q4 2022. This matches what we have seen in our interview with kfw covering their VC and PE barometer.

On the excellent news site, there is a substantial uptick towards the end of the year 2022 in announced seed funding rounds. All large European Hubs, Barcelona, London, Paris, Berlin, and Stockholm, showed more seed funding rounds. Only Amsterdam did show a decline, which may be due to the available data.

Exits and large fundraisings have filled the coffers of VCs, who build up their teams during the good years. This leads to increasing pressure to invest on the VCs by their investors, called LPs (think insurance companies and pension funds).

Cleantech has also emerged as a new growth sector for VC investments — on a European level. In the last 6 months, compared to the last 3 years, cleantech investments have increased disproportionally.

Classic sectors for VC investments remained sexy in the 2nd half of 2022, including fintech, media, health, and AI & big data.

Hardware is also a sector — along with consumer apps — just on the edge of becoming a growth story for VC investments.

Despite the job cuts announced in recent weeks or months, there is still net positive job growth in the European Startup Ecosystem — compared to before corona.

Meetup participation shows strong interest in startups and tech topics across Europe. Here Berlin took over London in the process.


2022 London in decline

  • Q3 London lost its prime position to Stockholm — for the first time, they are tracking the cities.

  • London is losing its edge

  • Connection to the entrepreneur survey. London is less popular than Berlin. Investments are a lagging factor


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The Interviewer

This interview was conducted by Jörn “Joe” Menninger, startup scout, founder, and host of Startuprad.io. Reach out to him:


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All Links and Show Notes

Here is our blog post:


Topics Discussed in this Interview

In this interview, we are talking about

LinkedIn Hastags zum Posten:

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Key Takeaways

  • The VC mood was significantly down in late 2022, with startups feeling the funding crunch. However, dry powder (uncommitted capital) remained available, suggesting a market correction rather than a complete shutdown.

  • In Q3 2022, London lost its long-held position as the European city with the most startup fundraisings for the first time — a historic shift in the European startup landscape.

  • Berlin was identified as the European capital of meetups by DEEP Ecosystems research, highlighting the city's vibrant community engagement as a key competitive advantage in the ecosystem.

  • This episode marks the quarterly cooperation between Startuprad.io and DEEP Ecosystems (Munich), using data-driven benchmarking with 100+ metrics to track the pulse of the European startup ecosystem.

Atomic Answer

Entities & Ecosystem Map

Organizations

  • DEEP Ecosystems — Munich-based research firm providing quarterly European startup data, partner of Startuprad.io

  • Startupraven — Sponsor of the episode, early-stage startup discovery platform

People

  • Thomas Kösters — DEEP Ecosystems, quoted on Berlin as European capital of meetups

Cities & Hubs

  • Berlin — European capital of meetups per DEEP Ecosystems data

  • London — Lost #1 position for European fundraisings in Q3 2022 for the first time

  • Munich — Home base of DEEP Ecosystems research

Topics

  • VC cycle analysis — Q3 2022 downturn, dry powder availability, funding crunch

  • European startup ecosystem benchmarking — 100+ metrics tracked quarterly

Relationship Map

  • DEEP Ecosystems → Quarterly research partner → Startuprad.io European Startup Pulse series

  • Thomas Kösters → Lead researcher → DEEP Ecosystems

  • London → Lost #1 fundraising position → Q3 2022 (first time ever)

  • Berlin → #1 European city → Startup meetups per DEEP data

Notable Quotes

"Berlin is the European Capital of Meetups." — Thomas Kösters, DEEP Ecosystems, highlighting Berlin's community-driven ecosystem advantage based on quantitative analysis.

Internal Links

Partner with Startuprad.io

Startuprad.io is the leading independent media platform covering startups, venture capital, and innovation across the DACH region (Germany, Austria, Switzerland) and Europe. We offer B2B partnership opportunities for companies looking to reach startup decision-makers, founders, and investors.

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Frequently Asked Questions

Did 2022 mark the start of a new VC cycle in Europe?

DEEP Ecosystems data from Q3 2022 showed a significant VC mood downturn, with startups feeling the funding crunch. However, dry powder (uncommitted capital) remained available, suggesting this was a market correction and the beginning of a new, more cautious VC cycle rather than a complete freeze. London lost its top fundraising position for the first time, signaling a broader reshuffling of the European startup landscape.

What is the European Startup Pulse by DEEP Ecosystems?

The European Startup Pulse is a quarterly research cooperation between Startuprad.io and DEEP Ecosystems (Munich). It uses 100+ metrics to benchmark and track the health of the European startup ecosystem, covering fundraising trends, city comparisons, meetup activity, and VC sentiment across major European hubs.

Why did London lose its #1 fundraising position in Q3 2022?

In Q3 2022, London lost its historically dominant position as the European city with the most startup fundraisings for the first time. This reflected the broader VC downturn affecting the UK particularly hard, with the 2022 market correction shifting capital flows and creating opportunities for other European hubs to gain ground.

About the Host

Joern "Joe" Menninger is the host of the Startuprad.io podcast and covers founders, investors, and policy developments across the DACH startup ecosystem. Through more than 1,300 interviews and nearly a decade of reporting, he documents the evolution of the European startup landscape. Follow Joern on LinkedIn.

Shape the Conversation on Venture Capital and Innovation

Startuprad.io partners with selected companies that want to shape the conversation around venture capital, innovation, and startup building in Europe. If that is relevant for your team, you can learn more here: Partner with Startuprad.io

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