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December 22, 2012 04:00 pm GMT

From Silicon Valley To Europe: Is The U.S. Series A Crunch Affecting European Startups?

cc-imageQ: Is Silicon Valley’s Series A crunch causing a chill in Europe? A: Yes and no. A lot has been written about the Series A crunch/palpable chill in Silicon Valleythat’s making founders pull their cardigans a little closer. Most recently a report by a venture capital analysis firm CB Insights suggests there hasn’t actually been a reduction in the amount of money available, but rather too much seed funding causingtoo much demand for the same amount of cashat the Series A level.Whichever way you cut it, a lot of U.S. seed-funded startups looking to upgrade their backing to Series A level are going to be going away with an empty begging bowl in the future. But what about beyond the Valley? Doesthe funding situation in the U.S. have an impact on startup funding in Europe? As the old adage goes, if the U.S. sneezes, the rest of the world catches a cold. So if Silicon Valley has a Series A chill, does that make the funding situation a little less forgiving for Europe’s seed-funded startups too?I asked several European VCs and investors for their views on whether the Series A situation in the U.S. is making life more difficult for startups in Europe. I’m not making any claims that this is a scientific poll — it’s a very small sample — but, nonetheless, it’s an interesting snapshot of opinion in the European investor community as 2012 draws to a close. My takeaway from the poll is that while this group of European investors hold slightly differing views on how much influence the Valley has on the funding situation in Europe, they tend to fall into two camps on the Series A crunch: those that say there’s no change in Europe because it’s always been tough raising a Series A round here; and those that say Europe is having its own mini seed-funding boom — which means that getting a Series A is probably going to be even tougher in the future thanks to increased competition. Sucks to be a European startup then — but if you do manage to get Series A, rest assured you worked your ass off to get it (and probably deserve it). Angel investorJeremie Berrebi, who co-foundedKimaVentures, says the U.S. Series A situation makes no difference to startup life in Europe. “The answer is simple: It was always difficult to raise Series A moneyin Europe…and it’s

Original Link: http://feedproxy.google.com/~r/Techcrunch/~3/g5km-aRS0h8/

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