Do we see light at the end of the tunnel yet?

In hindsight, it is easy to see how boosted the VC market was a few years ago. High valuations and intense competition among investors were two of the main challenges experienced by VCs. Today, we are seeing a ­totally different VC market. There is a significantly ­lower pace of new investments with several VCs experiencing difficulties in finding ­co-investors and receiving considerably fewer investment proposals.

Even if many of the European VC market ­sentiments deteriorated ­further this year, the expectations for the next twelve months have ­improved. However, the confidence of fund managers in the long-term growth prospects is at an all-time low since 2018. This is largely ­explained by the ­current macroeconomic and geopolitical ­situation making both fundraising and exits challenging.

Zooming in on the Nordics, Sweden is starting to lose its dominance. The reason for this could be because the Swedish VC scene is more mature and most declines have been in later finan­cing rounds. Instead Norway and Denmark have gained ground. Will the current climate be a reboot to a more even Nordic VC market, or will it scare off many new investors in the VC space? Time will tell. But a continuous ­cyclical development is the only thing we know for sure.

Activity levels same as in 2019

Most countries are back to 2019 levels of activity, with some exceptions like France (+37%), Denmark (+72%), Norway (+181%) and Italy (+57%), venture investment in H1 2019 compared to H1 2023.