2025 EUROPEAN edition

The venture capital benchmark report:
European Edition

Why read this report?

01

Market trends

Understand how European VC dealmaking activities changed over the past year and present challenges.

02

Benchmarks of top firms

Learn what differentiates top European firms and see how your firm’s activities compare.

03

Practical guidance

Get actionable insights into adapting your deal strategies to get ahead this year.

introduction

The flight to quality persists in Europe

23
%

Year-over-year decrease in deal volume in Europe.

source: PITCHBOOK

After a year of economic uncertainty, European venture capital (VC) deal activity took a hit—deal volume decreased 23% year-over-year (YoY) in 2024. However, valuations improved as investors doubled down on companies with clearer paths to profitability and long-term growth.

Amid the broader pullback in investment, certain sectors flourished. Unsurprisingly, AI was one of them, and saw a 24% YoY increase in deal value—closely followed by life sciences. These sectors also helped drive a recovery in the European exit market. 

In this context, we analyzed Affinity data on more than 640 European VC firms across 27 countries (who we refer to as “All Firms”) versus a subset of those ranked as top investors by Dealroom’s EMEA VC Investor Ranking (who we refer to as “Top Firms”). Our analysis focused on email volume, introductions made, and the number of deals and new contacts added to the Affinity CRM. 

Read on to explore key dealmaking benchmarks and the strategies that set Top Firms apart.

European venture capital deal activity

source: PITCHBOOK
chapter 01

Deal selectivity reigns king

Median number of deals added per firm

Top Firms remained dominant in 2024, but they were far more selective.

Across all four quarters, Top Firms added significantly more deals to their pipeline than All Firms—more than four times as many in Q1 alone. Yet even the most active investors weren’t immune to the broader slowdown. By Q4, Top Firms had added 42% fewer deals YoY, marking a sharp pullback.

This trend reflects a shift in the market toward “value over volume,” as PitchBook notes in its Annual European Venture Report. Top Firms are likely focusing on fewer, higher-quality deals. In turn, there’s an increased emphasis on thorough and specialized diligence, including greater scrutiny around companies’ product-market-fit, scalability, and founder growth potential.

Meanwhile, All Firms saw steadier, albeit slower, activity—ending the year with a 10% YoY decline in deal flow. For less established firms, competing for high-quality deals is proving increasingly difficult. The market continues to consolidate around brand-name firms with the capital and reputation to win the most competitive opportunities.

chapter 02

Two paths to deal flow

Median number of emails sent and received per user

After two slow years of dealmaking, All Firms shifted gears to outbound efforts in 2024, sending and receiving 15% more emails YoY in Q4. To counter heightened competition—a concern for 42% of investors—many firms are reaching out to a broader range of founders in niche sectors and less saturated, international locations. 

By contrast, engagement for Top Firms stayed relatively flat and they sent and received 6% fewer emails YoY in Q4 2024. Rather than casting a wide net, their priority was clear: lean into existing relationships.

Median number of contacts added per user

source: AFFINITY

With established brands and proven track records, Top Firms could rely more on inbound channels, and they ended 2024 with a 10% YoY decrease in new contacts.

All Firms took a different approach. Despite a dip in Q3 2024, they had higher, more consistent network growth throughout the year—especially in Q1 when they added 5% more contacts to their networks than Top Firms.

Regardless, to widen the deal funnel beyond their existing relationships, more firms are turning to data-driven sourcing tools

chapter 03

A shift towards portfolio support

Median number of introductions made per user

Top Firms prioritized introductions in early 2024, especially in Q1, when they made 15% more introductions QoQ. This spike came even as their network growth slowed, signaling a deliberate shift: Top Firms focused on introductions not primarily for sourcing deals but to support their portfolio companies.

With stronger visibility into their connections and larger networks to draw from, Top Firms leveraged their existing relationships to create value for their portfolio companies—connecting them with talent, potential customers, and vendors. 

While All Firms followed a similar pattern, the volume and intent of introductions differed. For All Firms, making introductions played a more traditional role—helping fuel their deal flow. 

Many firms are feeling the pressure to deliver returns on aging funds. According to Carta, “Half of all funds from the 2018 vintage have still not distributed any capital back to their LPs.” In response, Top Firms are doubling down on portfolio support to boost LP confidence.

chapter 04

Strategies of Top Firms

28
%

of investors say the biggest opportunity for data in their investment operations lies in network management.

source: Affinity’s 2025 private capital predictions report

The trends in this report reveal three key differences in the dealmaking activities of Top Firms:

1. Increased selectivity and a relationship-driven approach to diligence

Top Firms saw a decrease in deal volume in 2024, which reflects a deliberate shift toward “value over volume”—honing in on fewer, higher-potential companies. These firms are applying stricter sourcing and diligence criteria, with a sharper focus on founder quality and growth potential

At the same time, founders are becoming more sophisticated in how they choose investment partners, making the relationship component of venture investing more important.

2. A targeted network strategy

With a YoY decrease in new contacts in 2024, Top Firms are prioritizing network depth over breadth in their relationships—and they’re using technology to help. 28% of investors say the biggest opportunity for data in their investment operations lies in network management. 

With clear visibility into their extensive networks, Top Firms are able to pinpoint the right connections at the right time, whether for a warm introduction or to support a portfolio company.

3. Integrating data throughout the deal cycle

To enable greater selectivity and maximize the value of their networks, Top Firms are turning to data and technology. Over the past year, the number of data-driven VCs has grown by 20%—with 38% of these firms using data tools to source over 40% of their deals. 

From spotting early signals of product-market fit to accelerating company research with AI, Top Firms are using data to sharpen decision-making and stay competitive in a more selective market.

chapter 05

Navigating an uncertain dealmaking landscape

While European venture capital continues to face an array of challenges, looking at the industry’s performance over a longer horizon offers reason for optimism. 

Over the past decade, European venture investment has increased 10-fold, and the number of early-stage companies has more than quadrupled—from 8,000 in 2015 to over 35,000. Many investors remain hopeful about the industry, with 72% of dealmakers expecting to close more deals in 2025 than they did last year. 

With ongoing volatility, firms will need to stay grounded in the fundamentals of venture capital—prioritizing meaningful relationships and sound decision-making—while embracing the tools that make them faster and sharper. 

That means using data to guide strategy, leveraging technology to streamline deal sourcing and management, and investing in systems that help firms adapt with the market.

“We're in the midst of a cycle shift. There's a lot of uncertainty ahead of us, and so in times of uncertainty, there tends to be a flight to quality and people saying, ‘Okay, I can't really understand the directions that all of these different trends are going in, but I can at least put my chips in a couple of bets that are going to turn out for sure.’”

Mercedes Bent
Venture Partner at Lightspeed Venture Partners
source

“Having a single source of truth is super important, and a single source of truth that's extendable is doubly important. The way that Affinity has architected data, especially with API v2, has made things incredibly straightforward.”

Abhishek Lahotia
Head of Platform, Highland Europe
source

Find and win better deals faster with Affinity, the leading CRM for VC

Affinity combines AI, automation, and relationship insights to streamline your entire dealmaking process—from sourcing and relationship management to portfolio support and fundraising.

With Affinity, you can: 

  • Discover companies beyond your network: Uncover and monitor high-potential startups with data enrichment, growth signals, and watchlists. Check out Affinity Sourcing
  • Reach the right deals first: Accelerate outbound deal sourcing by understanding the strength of each relationship in your firm’s network and the warmest introduction path. Fast-track company research with Industry Insights, Affinity’s AI-driven market intelligence tool. 
  • Drive portfolio growth: Respond to founder requests, share timely updates with LPs, and demonstrate your firm’s value to founders and LPs with centralized tracking and comprehensive analytics
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About our data

The Affinity platform data displayed in this report is aggregated and anonymized. It represents the dealmaking trends of more than 640 European VC firms (“All Firms”) versus a subset of those ranked as top investors by Dealroom’s VC Investor Ranking - EMEA Combined who use Affinity (“Top Firms”). 

Dealroom defines top investors as: “A ranking of venture capital investors, based anywhere, investing in companies anywhere, and at any stage. The ranking looks at how successful investors are at picking startups that go on to big outcomes – primarily looking at unicorns and future unicorns (companies valued $250M-$1B). Investments are weighted by the stage at which firms invest in the most successful companies, with the aim of creating insights from a level playing field, e.g. most points for backing a unicorn at Seed, then Series A and so on.”

The data in this report uses median figures to provide an accurate picture of how the market has evolved on a quarterly basis from 2023 - 2024.

The information in this report is provided for general informational purposes only. While efforts have been made to ensure its accuracy, no warranties or representations are made regarding the completeness or reliability of the content. Project Affinity, Inc. is not liable for any losses or damages arising from the use of this report. This report does not constitute professional advice. For specific concerns, consult a qualified expert.