In the dynamic landscape of Dutch startups, the third quarter of 2023 has seen resilient performance with entrepreneurs securing €420M in venture capital funding. This figure has been disclosed by The Quarterly Startup Report.
Released by Dealroom.co, Golden Egg Check, KPMG, the Regional Development Agencies (ROMs), Dutch Startup Association (DSA), and Techleap.nl, this report comprehensively analyses the funding landscape for Dutch startups in the third quarter of 2023.
Notably, the report highlights a consistent composition of deals per phase, underscoring the stability in the growth stages of startups.
Here are the key takeaways:
Dutch startups raised €420M
Dutch startups raised at least €420M in venture capital in the third quarter of 2023.
Despite a slight dip from the previous quarter (€525M) and the third quarter in 2022 (€435M), this follows a usual seasonal pattern.
The number of deals the Quarterly Startup Report analysts identified has also decreased.
Last quarter, a total of 85 deals were closed. It is a significant drop compared to 98 deals in the third quarter of last year and more than 100 in previous quarters.
Although it is common to see fewer investments being made and announced during the summer season, the sharp decline in the number of deals is a cause for concern, says the report.
According to the report, there were slightly more large deals in the past quarter, contrary to the trend.
Approximately 15 per cent of investments exceeded €15M, compared to 8 to 10 per cent in Q1, 2023.
“It seems to be a tentative sign of recovery that venture capitalists are again investing more often in later-stage companies with larger amounts,” the report says.
At the same time, the share of smaller deals (€1-4M) has fallen from 40 per cent in the first quarter to 34 per cent.
Golden Egg Check’s estimate!
According to Golden Egg Check, the reported €420M in venture capital funding for Dutch startups is expected to be an underestimate.
Why?
The analysts have detected market signals indicating that companies are securing internal rounds from existing shareholders to extend their financial runway.
These rounds, which startups usually prefer to keep private, are not typically disclosed to the public.
As a result, the analysts anticipate fewer investments will be officially reported compared to the actual number of investments.
Additionally, some investments are disclosed without specific amounts.
Like every quarter, Golden Egg Check’s analysts estimate how significant these investments are likely to be based on investors’ usual investment amounts and the stage the company is in.
Considering these estimations, Thomas Mensink of Golden Egg Check suggests that investment in Dutch startups and scale-ups in Q3 might be closer to €465M.
€1.4 billion invested in 2023
A total of almost €1.4B has been invested so far in 2023, reveals the report.
It means that the amount of capital invested at the end of 2023 is expected to be slightly above the 2020 level.
While much attention has been paid to cleantech and healthcare in recent quarters, there have now been larger funding rounds in various sectors. It can be seen as a sign that the market is stabilising.
Dealroom also speaks of a record amount of €1.3B in new capital raised from investors by Dutch venture capital funds and will be deployed in the next 3 to 5 years.
An outlier here is the new Amsterdam-based NATO Innovation Fund, which will invest in security-related startups and scale-ups with a fund of €1B.
With €400M in other new VC funds, Dutch VCs had a relatively good quarter.
Top deals in Q3
Neobank bunq raised the largest investment last quarter, totaling more than €44M.
The rest of the top 11 largest deals are a mix of software companies and a relatively large number of high-tech companies and companies with climate technology.
The complete top 11 are:
- bunq €44.5M
- SMART Photonics €40M
- Lepaya €35M
- MYCB1 Group €30.81M
- Rocsys €32.65M
- Meatable €31M
- Framer €25.5M
- Sensor fact €25M
- Nearfield €16M
- HyET Solar €14.5M
- VSParticle €14.5M
“The fact that larger financing rounds are taking place in a broader segment could mean that we can start to look ahead in a cautiously positive manner,” says Lucien Burm, chairman of the Dutch Startup Association.
“It may have a relationship with the startups that raised much money during corona and have now successfully raised money. We are therefore watching the next quarter with great attention to see whether this trend will continue in the coming period. The fact that many funds have been set up in 2023 contributes to those positive expectations,” adds Burm.
Arjen Strijker, Capital Lead at Techleap, says, “It is good to see that the market is stabilising and that relatively large investments continue to take place. It is necessary because innovation in these markets is expensive but extremely important for our economic security and geopolitical autonomy. We expect an increase in relatively large investments in Q4 and therefore see that the Dutch tech ecosystem will prove resilient in the coming quarters.”
Read the orginal article: https://siliconcanals.com/news/startups/dutch-startups-raised-420m-in-q3/
