Funding in Europe is recovering while The US and Asia are in freefall

At Funderbeam, we recently published a report showing that globally, funding of startups had dropped more than 50%. One positive finding however, is that in the EMEA-region (mainly driven by western EU countries), funding actually rose slightly from Q2 to Q3.

In Q2 2016, EMEA startups took in a total amount of $3.3bn, which increased to $3.4bn in Q3 same year. Albeit a small increase, this is quite significant compared to AMER and APAC, who dropped by 48% and 64% respectively:

funding in APAC Q3 2016

funding in AMER Q3 2016

Each line represents the total funding of one year, split by quarters on the horizontal axis. The blue line indicates most recent year.

The sooner you fall, the sooner you recover?

One thing that is important to point out is, part of the explanation for EMEA performing better than the two other regions, is that EMEA saw a big drop in funding one quarter earlier:

funding by region Q3 2016

Each line represents the total funding per quarter. The color of each line represents the respective region.

What will the future hold?

We can only hope, that this means AMER and APAC will also recover and maintain a level of funding that will be significantly lower than the highs of mid 2015 and early 2016 respectively. Overall, APAC was the region that grew most dramatically, and now also seems to be the one to fall the most dramatically.

It will be very interesting to see, how startups develop in the next 12–18 months when the the reduced total funding will start to really take effect. Currently, we can assume that a lot of companies are still burning through some or all that cash they raised from late ’15 until mid ’16, but what will happen when they run out?

To read the full report (it’s free!), go to Funderbeam.com/reports.
For definitions and methodology, please see report.