The latest KPMG: Q2’24 Venture Pulse Report – Europe – reports that VC investment in Europe rose to $17.8 billion in Q2’24 from $13.9 billion in Q1’24, driven by an uptick in mega-deals, including a $1 billion funding round by AI autonomous driving technology company Wayve, a $999.6 million raise by consumer lending platform Abound, a $650.6 million raise by LLM-focused Mistral AI,1 and a $621 million raise by Monzo bank.
VC investment in the UK more than doubles in quarter
After falling to a low not seen since Q2’18 in Q1’24, VC investment in the UK more than doubled quarter-on-quarter, rising from $2.9 billion to $6.9 billion between Q1’24 and Q2’24.
The largest deals included Wayve’s $1 billion raise and two large deals in the fintech space — a $999.6 million raise by Abound and a $621 million raise by Monzo. While many later stage companies in the UK found it challenging to raise money and close deals in Q2’24, the increasing number of mega-deals over the latter half of the quarter was viewed as a positive sign.
Pre-seed and seed stage deals continued to see robust interest from VC investors in the UK, with median deal sizes increasing quite substantially. The growth likely reflects both a growing appetite for making investments in Early-stage companies as the market in the UK begins to pick up and a desire on the part of VC investors to derisk their portfolios.
Ireland sees VC investment pickup
VC investment in Ireland picked up in Q2’24, reaching $239 million compared to $150 million in Q1’24.
However, while the value of deals was up around 40% year-on-year, the number of deals brokered was down by just over 25%.
The Report recorded 24 Irish deals mainly in AI, biotech and fintech raising a total of $237.5 million.
A $110 million raise by biotech SynOx Therapeutics accounted for a large part of this total.
However, fintech company Nory, raised $16 million, Ocean data company, XOCEAN, raised $32.5 million in a Series B funding round and digital health and wellbeing provider Spectrum.Life secured $18.3 million.
Trends to watch for in Q3’24
The authors say that although positivity is growing in Europe, a number of uncertainties are expected to keep VC investors cautious heading into Q3’24, including yet to be finalised governmental decisions following the UK general election in July and the US presidential election in November. However, the firm believes that AI will likely remain a very hot area of investment in the region, in addition to energy and cleantech.
Despite these uncertainties, it says there is some optimism that the IPO market in Europe could see some fresh activity heading into Q3’24.