London, Paris, Amsterdam are the leading VC ecosystems in Europe, report finds

London, Paris, Amsterdam, and Berlin are the leading VC ecosystems in Europe, but the region is significantly lagging behind the US and Asia.

That’s according to the latest report by Pitchbook analysts, who ranked global VC ecosystems based on their development and growth level. They used data related to deals, exits, fundraisings, and overall activity from the last six years, between Q3 2018 and Q2 2024.

The development rankings are based on size and maturity, while the growth rankings are based on short-, medium-, and long-term growth momentum.

Only two European cities among the best-developed ecosystems

Only London and Berlin make it to the top 20 in terms of development score, according to Pitchbook.

The list is dominated by US-based heavyweights such as San Francisco and New York and a large number of Asian cities, including Beijing and Shanghai in China.

London is the European leader with a total deal value of $99.7bn, enough for seventh spot in the worldwide rankings. It is followed by Berlin, which takes 17th place globally, with $30.2bn in deal value — attracting approximately three times less investment than the UK capital.

But both London and the rest of the European locations face challenges in bridging the gap with the US and Asia, according to the analysis. These include lower valuations, smaller rounds, and lower exit value, especially compared to the US.

“Value and volume statistics for locations tend to be lower in Europe than the US and Asia which feeds into our Development Scores,” Nalin Patel, Pitchbook’s lead EMEA private capital analyst and the author of the report, told TNW.

“One reason could be the infancy of the VC ecosystem in Europe compared to the rest of the world. Another factor could be that Europe is more fragmented with smaller ecosystems spread across the continent.”

Europe does better in terms of growth

Growth-wise, seven European cities make it to the top 20, including both emerging and more mature hubs. These are Lyon, Prague, Vienna, Utrecht, Dublin, Amsterdam, and Barcelona.

In country rankings for the same category, Switzerland is the fastest-growing VC ecosystem globally with a total deal value of $19.9 and a total exit value of $53. It is followed by Singapore and the United Arab Emirates.

Eight more European countries make the list, with Austria ranking fourth and Ireland ranking sixth.

Top European VC ecosystems

In terms of both development and growth, only London makes it to the global top 10.

Below you can see the full list of the European top 10 cities, based on their global ranking: