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01

Key Findings

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02

The State of European Tech 2019

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Investments

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Investors

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05

Diversity & Inclusion

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06

People

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Purpose

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08

Places

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09

Policy

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About

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Appendix

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Portrait of a European Tech Founder

Our survey of more than 1,200 founders from across Europe found that 21% of founder respondents self-identify as female. The gender diversity of founders varies across the region. According to the survey responses, the UK and Ireland have the highest gender diversity, while France, the Benelux and Southern Europe have the lowest levels.

Which gender do you identify with?

Source:

Legend

  • Women
  • Men
  • Non-Binary
  • Other
  • Prefer not to say
Note:
Founders only. Numbers may not add to 100 due to rounding.

The overwhelming majority of founders who responded to the survey self-identify as White/Caucasian, making up 84% of responses received. The ethnic diversity of founder respondents was highest in the UK, where 20% of founder respondents self-identified with a minority ethnic group.

Which best describes your ethnicity?

Source:

Legend

  • Caucasian/White
  • Asian
  • Mixed
  • Black/African/Caribbean
  • Middle Eastern/North African
  • Hispanic/Latinx
  • Other
  • Prefer not to say
Note:
Founders only. Numbers may not add to 100 due to rounding.

Around one-quarter of all European founder respondents to the survey are immigrants; in other words, they have chosen to build their company in a country not the same as their country of origin. There is a huge variance among the different parts of Europe. In the UK, approaching 50% of all founders are immigrants. In Central and Eastern Europe, it is only just over 10% of founders.

Are you based in your country of origin?

Source:

Legend

  • Founder not based in country of origin
  • Founder based in country of origin
Note:
Founders only. Numbers may not add to 100 due to rounding.

The founder respondents to our survey showed a high level of educational attainment. Three-quarters of founders have a bachelor's or master's degree, while another 7% have a doctorate. This compares to just 35% of EU-28 population aged 25-54 who have attained tertiary or higher education, according to Eurostat.

What best describes your highest formal educational attainment?

Source:

Legend

  • Bachelor's degree
  • Master's degree
  • Doctoral degree
  • Professional degree
  • Trade school
  • Some college/university study without earning a degree
  • Secondary school
  • Primary/elementary school
  • No formal education completed
Note:
Founders only. Numbers may not add to 100 due to rounding.

81% of entrepreneurs were living comfortably before they founded their company, compared with 39% of Europeans who say they were living fairly easily, easily or very easily according to Eurostat.

Living comfortably

81%
Lived comfortably/met basic expenses with extra left over

How would you describe your financial situation right before starting your company?

Source:
Note:
Founders only. Numbers may not add to 100 due to rounding.

The assumption that all founders have access to 'friends and family rounds' still bewilders me.

The assumption that all founders have access to 'friends and family rounds' still bewilders me. We need to develop an empathetic understanding that this is not accessible to all, and thus develop inclusive pathways that level the playing field.

These pathways look like community groups, diverse angels and early-stage pre-seed funds. Initiatives such as Natwest Back Her Business are making those first steps, the program match funds female founder crowdfunding campaigns. On YSYS pre-accelerator FoundersDoor, one of our alumni Emilia Servane Founder of The Good Hair Co, took part and was able to crowdfund £1,500 to which Natwest matched an additional £1,500 - this capital will now give her the ability to validate her ideas and move forward.

We need more impactful interventions like this to truly have a diverse and inclusive European startup ecosystem.

Deborah Okenla

YSYS

Founder & CEO

Looking only at those founders who have attained a university degree, there are interesting differences in the diversity of subjects studied by founders from different regions. Founders in the Nordics, UK & Ireland have more diverse backgrounds than in other regions. CEE, DACH and Southern Europe stand out with the largest share of founders with a technical degree.

Share of capital invested (%) by education background and by region, 2015-2019

Source:

Legend

  • % of capital raised
  • European average capital raised (%)
Note:
Numbers don't add up to 100 because deals can have more than one founder involved. 2019 based on data up to September 2019.

The Unicorn Trajectory

In November 2019, Notion, a European VC investing in early-stage SaaS and enterprise tech startups, published a comparison of people hired into leadership teams of B2B software $1B+ companies (unicorns) and B2B software companies that raised the same amount of VC money at the same time as unicorns, but did not enjoy the same levels of success. The research paints a useful picture of the diversity of leadership teams (Founders, C-level, EVP, SVP, VP) of these companies.

A high proportion of companies that have scaled to $1 billion or more have at least one leader with a top university degree, but also a high proportion of these same companies have leaders that didn't attend university at all.

Share of companies (%) that have at least one leader with different academic qualifications

Source:

Legend

  • Unicorns
  • Control group
Note:
For access to Notion's full report on leadership hiring at unicorn companies, The Unicorn Trajectory, please visit: https://notion.vc/resources/how-unicorns-hire/

The prevalence of leaders in $1B+ companies with no university degree is highest in sales, technical and operational functions and lowest in finance and marketing.

Share of companies (%) that have at least one person with no university degree in their leadership team per function

Source:

Legend

  • Unicorns
  • Control Group
Note:
For access to Notion's full report on leadership hiring at unicorn companies, The Unicorn Trajectory, please visit: https://notion.vc/resources/how-unicorns-hire/

Across Europe, 40% of seed stage startups have a founding team aged between 26-30 years old. Southern Europe, DACH and the CEE regions have the largest share of young founders. Only 7% of founding teams in the CEE are over 40 years old - while in France, this number is close to 20%.

European founding teams

50%
of seed stage European founding teams are on average less than 30 years old.

Share of founding team (%) in age groups by region

Source:
Note:
Seed stage startups founding team average age post 2015. All Dealroom.co data excludes the following: biotech, secondary transactions, debt, lending capital, grants.

The importance of age diversity is supported by Notion's research. Teams of companies that scale to a valuation of $1 billion or more are significantly more diverse in leadership experience than those in the control group. Their most experienced leaders have more experience, and their least experienced leaders less, than those in the control group.

Years of experience of least and most experienced leaders in unicorn companies versus the control group average per year since founding

Source:

Legend

  • Least experienced leaders
  • Most experienced leaders
Note:
For access to Notion's full report on leadership hiring at unicorn companies, The Unicorn Trajectory, please visit: https://notion.vc/resources/how-unicorns-hire/

The wide range of experience in the average $1B+ company, and how this evolves through the journey of the company, can be seen in the distribution of leaders by years of experience.

Distribution of previous years of experience of each leader in an average unicorn per year since founding

Source:

Legend

  • Year 0
  • Year 1
  • Year 2
  • Year 3
  • Year 4
  • Year 5
Note:
For access to Notion's full report on leadership hiring at unicorn companies, The Unicorn Trajectory, please visit: https://notion.vc/resources/how-unicorns-hire/

The companies seeding the largest number of European tech founders are mostly from the US. Ten of the Top 15 companies by number of founder alumni are American, with Microsoft in first place followed by Google and BCG. Nokia is the highest-ranked European company. Rocket Internet is the only homegrown, Internet-era company that makes the Top 15.

Top 15 companies by number of founder alumni

Source:

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