Artificial intelligence Startups Venture

European Venture In 2023 Halved From Peak, But Was Still Above Pre-Pandemic Funding 

Europe Quarterly. Illustration of man with bag of $ going down an escalator while robot goes up.

Funding to European startups reached $52 billion in 2023, down 39% year over year from $86 billion invested in 2022, Crunchbase data shows.

However, Europe’s share of the venture capital ecosystem has increased since 2021. In 2022, the year the downturn settled in, Europe declined by a smaller percentage when compared to North America and Asia.

“We’ve gained influence in the past six to seven years,” said Philippe Botteri, a London-based partner at Accel who has been with the firm since 2011 and witnessed the growth of the European venture ecosystem.

While valuations have come down since 2021, digital transformation of companies and services has continued.

Table of contents

Based on an analysis of Crunchbase data, Europe’s deepest cuts year over year were seen in late-stage funding. Late stage almost halved in 2023, while seed and early-stage funding were each down 30% year over year.

In Europe, 2023 funding was at its lowest since 2021. By contrast, 2023 funding to North American and Asian startups dipped to amounts seen before 2018 and 2016, respectively.

AI revolution

AI startups in Europe raised $5.8 billion last year, which includes funding to foundation model companies Aleph Alpha, based in Germany, and France-based Mistral AI. Other large rounds were invested in France-based AI code developer Poolside, German-based translation AI DeepL, and London-based generative video company Synthesia.

Formidable talent in AI has come from Europe, specifically the team from DeepMind, which was acquired by Google in 2014.

“Generative AI has driven a lot of investment in new technology,” said Botteri. “Every single software company is incorporating generative AI in their code.”

Quarterly findings

Funding to European startups in the fourth quarter of 2023 reached $10.6 billion, down 23% year over year and 35% quarter over quarter — the lowest funding quarter since Q3 2020.

Funding counts at early and late stage in Q4 were down around 30%  year over year. Seed funding counts typically increase over time as smaller seed fundings are added after the close of a quarter.

Late-stage reset

Late-stage funding in Q4 reached $4 billion, the lowest quarterly amount since Q3 2020. The third quarter of 2023, however, saw an increase in funding to battery technology and manufacturing.

Early stage holds up

Early-stage funding has held steady since the initial quarterly decline in Q3 2022. Funding to early-stage startups in Q4 2023 reached $5 billion, flat quarter over quarter and year over year.

A greater proportion of dollars was invested at Series A compared to Series B.


Funding to seed startups reached $1.6 billion in Q4 2023, flat quarter over quarter and down a third year over year.

Closing out 2023

Europe is better placed to compete in this era of tech than it was a decade ago, with a more established venture ecosystem, deep talent and strong connections to the U.S. markets. Europe has played a leading role in fintech, health care and hardware. And the race around AI technology is just getting started.


The data contained in this report comes directly from Crunchbase, and is based on reported data. Data reported is as of Jan. 3, 2024.

Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of funding terms

We have made a change to how we include corporate funding rounds in our reporting as of January 2023. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.

Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.

Early-stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.

Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million.

Technology growth is a private-equity round raised by a company that has previously raised a “venture” round. (So basically, any round from the previously defined stages.)

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

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