Investments outside North America just had the best quarter in years
Venture capital activity There was a strong return to shape in Europe and Asia in the third quarter, data shows.
The two continents invested more venture capital in their local startups than they have in some time, which underscores that the strong VC results the US saw in the third quarter weren't a coincidence, but part of a wider trend.
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Data compiled by CB Insights shows a global acceleration in the number of dollars venture capitalists around the world are putting in as 2020 chews in the second half of the year. The record numbers the third quarter delivered contrast sharply with fears that startup country was overtaken in late first and early second quarters as COVID-19 overwhelmed some young tech companies with surprising turmoil.
However, the decline in venture capital activity was short-lived. With many startups selling software, their goods suddenly became more in demand. In a variety of industries, startups benefited from accelerated digital transformation as the world adapted to a new work environment. Aside from clear winners like video conferencing tools, other categories from remote learning to security tools have also gotten a dent.
The COVID tailwind, as it is sometimes called, doesn't seem to be specific to the United States or North America. Instead, given the venture capital data, we can conclude that startups around the world are enjoying a similar boost
Let's get to the numbers to better understand what's going on in Europe and Asia. (That being said, if you have data on the venture capital results of African startups please email me while I look for a more global picture. Recent business activity makes it clear that the American media needs to do more and better coverage of the continent .)
A strong Q3
The center of gravity of the venture capital world is still somewhere in the US, but this is how the three continents behaved in the third quarter of 2020, taking into account their venture capital dollars raised:
- North America: $ 37 billion
- Asia: $ 24 billion
- Europe: $ 9 billion
Asia's result was the best since at least the fourth quarter of 2018, as far as our data set goes. Europe's total has reached the high water mark set in the second quarter of 2019. As a combined pair, however, venture capital outside North America may have had its best quarter in years, if not ever.
Here is the data in graphical format: