Europe’s tech ecosystem: 2018 a record year for investment, but inclusion and diversity remain key challenges

International tech investment firm Atomico releases the 2018 State of European Tech report.
By Leontina Postelnicu
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The European tech ecosystem saw record levels of investment in 2018, with the software industry growing five times faster than the rest of Europe’s economy, according to a report by global venture capital firm Atomico.

Four tech IPOs or direct listings of European tech companies reached valuations of more than $5bn on opening day, and three of the top 10 largest tech IPOs in 2018 came from Europe, Atomico analysts say.

Based on data from LinkedIn, the report, carried out in partnership with Orrick and Slush, shows that the European tech workforce grew four percent last year, and a survey of 5,000 members of the ecosystem found that there was "strong agreement" that tech entrepreneurs would have a "bigger impact" than governments in Europe in addressing major global challenges.

London-based Quit Genius and ThinkSono and Helsinki’s Disior are some of the early-stage companies from the digital health and wellness field cited in the report to have raised in 2018 from top investors, having a “strong focus on solving a major global or societal challenge".

However, according to the analysis, 46 percent of women in the field reported that they have experienced discrimination, while 93 percent of all funds raised by European VC-backed companies in 2018 reportedly went to all-male founding teams.

Last year, around 93 percent of respondents to a survey organised by HIMSS, parent company of MobiHealthNews, indicated that women executives in European health care IT did not receive enough recognition of the contribution they make to the industry.

“Discrimination based on gender might be the most visible and quantifiable, but it is not the only form of discrimination that exists at worrying levels in the European tech ecosystem,” Atomico analysts say in the report, released in December 2018. “A meaningful number of respondents have experienced discrimination based on age and ethnicity too.”

They argue that prioritising diversity and inclusion “should be Europe’s first and most urgent priority”.

Meanwhile, new research from venture capital firm Pitchbook indicates that corporate venture capital investment in healthcare devices and supplies in Europe saw a “148.2% increase in deal value and a 29.4% increase in closed financings” in 2018, first reported by the Telegraph.

Citing Cambridge-based CMR Surgical’s robotic devices, Pitchbook says that, by aiming to reduce costs and improve outcomes, this type of technologies are seen as “attractive investment opportunities”.

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