For those familiar with the start-up scene, you’ll probably be sick of the term ‘unicorn’ – but for those outside of the tech industry, this won’t be a discussion about mythological creatures –it’s a lot more matter of fact that that! A unicorn is that rare breed of start-up that has been valued at over 1 billion – and Europe’s ‘unicorns’ currently have a collective value of $120 billion, reaching an average value of $3 billion each last year, according to Tech.eu.
Although Europe is producing billion-dollar companies at a faster rate than ever before, it still remains behind the US, however. For example, Facebook alone is worth twice as much as every single European unicorn put together. But it’s worth remembering that the U.S. is a more mature ecosystem; it’s been around for a longer time than Europe’s start-up scene, which can lead to basic differences in funding size and valuations.
Europe’s landscape is changing, however, with investments increasingly being made within Europe’s burgeoning tech hubs. According to EY’s Annual Attractiveness Survey (what a name!), London has now overtaken New York and Shanghai in a global ranking of top tech cities, second only to San Francisco. With support from organisations such as UK:TI, London and Partners, and Tech City, it seems clear that a robust supportive infrastructure is key to helping bolster start-up culture and creating an eco-system worth investing in.
European tech is stronger than ever, with the first quarter of 2016 delivering a record-breaking €4.6 billion worth of start-up funding. Already this year we’ve seen big investments made in potential future unicorns, including healthy fund-raising rounds for music start-ups Soundcloud and Deezer, although both could be deemed modest in comparison to market-leader Spotify’s impressive €0.9 billion.
When looking at Europe it’s easy to see that many of our unicorns have sprouted from the FinTech boom, and it’s an obvious argument to make with runaway successes like Transferwise. A quick look at Business Insider’s line-up of the 11 European unicorns created in 2015 paints a less black and white picture however, with various industries represented, from fashion to music and food to travel.
Tweet me at @AgostinelliAldo with who you think will be the next European unicorn #Eurocorn
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