Values of European unicorns plunge amid sharp fall in public markets

A tough 12 months in public markets has taken a heavy toll on startups. According to new analysis, each unicorn in Europe that went public in 2021 has since shrunk in valuation.

The losses observe record-highs for VC exit valuations in 2021. PitchBook, a monetary information agency, attributed the downturn to a shrinking public market.

The firm discovered that 13 unicorns went public throughout 2021’s bull market and IPO frenzy. Yet none have gone on to have constructive share value returns.

Their numbers paint a dismal image. By the top of 2022, greater than half of them had misplaced over 75% of their market cap since going public.

Their fortunes have reverberated throughout Europe’s tech ecosystems. In 2022, there was not a single unicorn exit via a public itemizing.

“The shutoff of the public listing market plays on the recency bias of founders and their management teams, as they have seen what happened to the companies that went public in 2021,” mentioned PitchBook’s analysts in their newest VC valuations report.

Despite the powerful 12 months for exits, there was constructive monetary progress for Europe’s main startups. Last 12 months, 47 new unicorns emerged on the continent —the second-highest determine on file — bringing their cumulative quantity to 129. Furthermore, combination unicorn post-money valuations have been rising dramatically earlier than indicators of a slowdown emerged. Yet the most recent members of the herd are electing to remain non-public.

Notably, meals supply startups had spectacular exits by way of acquisition in 2022. Finland’s Wolt was purchased by DoorDash for €2.7 billion, Spain’s Glovo was acquired by Delivery Hero for €800 million, and Germany’s Gorillas was snapped up by Getir for €1.2 billion.

These exit routes, nonetheless, could show to be anomalies. According to Pitchbook, most unicorns now desire to stay throughout the VC ecosystem.

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