The American Role in European Venture Capital

Abstract

European regulators and pundits grumble that US companies are gobbling up Europe’s startups. So far, however, the public discussion remains data-free. The goal here is offer data to illuminate the role of Americans in European venture capital, both as investors in the startups and as buyers of them. The big picture is this: based on data from VentureSource and Sand Hill Econometrics for 14,000 European startups, from 1992 - 2018q3, the fraction with at least one investment from American VC fund during the startup phase is 20 percent. Among the 14,000, there are 7,000 companies which are exited from the startup phase, and 9.3 percent of these were acquired by a US company. The money flows in both directions—American VC funds invest in European startups, and US companies acquire some of them. The companies with US investors raise far more money and have much more successful outcomes than those with no US investor.