January by D’Ornano + Co.: what are our 7 predictions for European Tech in 2022, why Freshworks is succeeding, and what implications does the current turmoil have on valuation of private companies?

This is our monthly newsletter dedicated to Tech x Investments.

European Tech is hot. Very hot. The European startup ecosystem just experienced the most extraordinary year in its history with a record amount of $93.3 billion of fundraising (compared to $38.5 billion in 2020). Years of wondering when the region’s entrepreneurs would get global respect were washed away by a tidal wave of investments, a significant part of those arising from US based investors and/or non traditional players in the VC game.

In this context, European founders and investors must recognize the underlying trends that are reshaping the ecosystem. Bigger rounds, more money, and increased attention bring greater responsibility and expectations, and the need to have the right playbook for growth.

As public valuations are hit, the question of private market valuations is again at the center of the table. We think the fundamentals of a continuing growth of the ecosystem are here to stay. However, as investors invest in European champions, the fundamental traits of the business mo…