The European tech ecosystem is already addressing the most pressing and transformative issues the world is facing. Pete Sugden Partner, Technology Companies Group, Orrick With prominent and sophisticated local capital, a growing and ma- turing entrepreneur base and increasing signs of the deep network effect from European tech success stories, 2024 promises to be a year in which European tech can “kick on” even stronger and truly shape the future. Sovereign funds still key, but a declining share of total funds raised As it does in every major venture ecosystem, government funding plays an important role in Europe too. National and regional initiatives, such as the European Investment Fund, British Patient Capital, KFW Capital, and bpifrance, are amongst the most active LPs in the European tech ecosystem. These agencies have consistently backed local fund managers with billions of dollars of capital each year. Contrary to perception, however, the scale of annual investment has not grown materially over the past 昀椀ve years. In fact, in 2022, government backing actually declined again compared to 2021 and vs. the peak year of 2020. But as more and more private institutional investors commit to the European venture asset class, the relative share of funds sourced from governments continues to decline rapidly as a percentage of total funds raised by European fund managers. This hit a record low of 15% of total funds raised in 2022, down from more than 30% in each year between 2018 and 2020. 211 | Fundraising