European tech startups struggle to raise investment money compared with companies based in Silicon Valley and New York, The New York Times reported.
Silicon Valley dominates the flow of venture money, with tech companies there getting $22 billion in 2014. In New York, where startups rely heavily on ties to existing industries such as fashion and financial services, tech companies raised $4.5 billion. That makes New York a better comparison to major European tech-startup centers like London and Berlin.
But the European cities still look underfunded by comparison. In 2014, London tech companies raised roughly one-third of New York’s amount, or $1.4 billion, and Berlin tech startups raised a total of just $1.1 billion this year.
Both those numbers are still improvements over 2013’s venture-capital takes. London’s investment total roughly doubled in 2014, as investors backed startups including alternative lending company Funding Circle (which raised $65 million) and online fashion company FarFetch ($66 million).
Berlin’s venture total jumped by 140 percent, according to CB Insights. The German capital was also home to two of Europe’s biggest tech IPOs in 2014: Zappos-like e-tailer Zalando and e-commerce startup incubator Rocket Internet. Both companies were launched by the Samwer brothers, and both earned multibillion dollar valuations on going public — $6.7 billion for Zalando and $8.4 billion for Rocket.