Venture capitalists see bright future for European startups

Europe’s tech start-ups have an even brighter future ahead, according to investors.

There has been plenty of good news recently about the European tech startup scene, and London in particular. From the first property tech accelerator in the UK capital to the succession of start-ups receiving bumper investments, it’s clear that the potential of this flourishing sector is expanding like never before.

So it may not be surprising that investors are looking towards a very promising future for European start-ups. A succession of promising companies have emerged from the scene so far, and venture capitalists expect the hits to keep on coming.

City AM reports that Saul Klein, a partner at venture capital company Index Ventures, has said he is expecting Europe to produce a $10 billion (£6.2 billion) business in the next few years.

“We will likely see a couple of European $10 billion exits in the next two or three years. The pipeline of European companies that are capable of exiting for three, five or $10 billon, is really building up,” he told the TechCrunch Disrupt conference in London.

Since this year alone Index Ventures has backed two billion-dollar companies in the forms of Just Eat and King Digital, it certainly seems the trend is heading towards ever bigger numbers. Debate will continue over whether they really are worth the huge amounts of money at which they’re eventually valued, but the upward trend among promising tech start-ups is going nowhere.

What’s more, it may be that the European scene does better without the distractions of the busy US market, according to Eileen Burbidge. The partner at venture capital company Passion Capital also told TechCrunch Disrupt that it could actually be sensible for firms to focus on Europe.

As well as the supportive business environment, there may even be regulatory advantages to the European scene.

“Nutmeg was a business that got funding from US investors and was starting off in the US, moved over to the UK because actually the Financial Conduct Authority has a much more lenient, flexible and progressive view on regulation than the US,” she added.