CVC the way to go for your early fundraising?

As many of you will know, we (Hyperion) support post-investment cleantech startups and scaleups to recruit their senior and executive teams. Therefore, we take an active interest in investment patterns and trends that impact our clients. 

In 2022, early series investments were high and there seemed to be a real healthy appetite for $MM rounds to help scale cleantech innovators, and in many cases the VC route was the preferred way to go.

Things have been a little different in H2 2023, and so far in 2024, certainly in Europe anyway. The companies I speak to in Energy Storage and Grid have described it as a slow and tough period for raising capital, especially from VCs. There is money out there, but it's more challenging and time consuming to close than before, with many companies settling for bridge rounds with existing investors or small <€5M tickets. Of course, there are odd exceptions - for example, Cylib and Instagrid in Germany, who raised €60M (Series A) and €87M (Series C) respectively.

For early rounds, there is often an obsession with the VC landscape, but this article from Sifted, featuring analysis from Dealroom, shares some eye opening insights around the growing role of Corporate Venture Capital in these rounds. 

Some of the key notes found in this particular analysis include: 

• Corporates accounted for >25% of total capital invested in European start-ups so far in 2024 
• CVCs have also been involved in 1 in 4 European startup deals
• Seed to Series B stages are the sweetspot for CVCs, with Series A most dominant 
• Low levels of CVC interest at pre-seed and Series D and beyond stages 

                                                        (Source: Sifted / Dealroom)

It's clear that the corporate route is one to seriously consider, if you're a Founder / CxO looking at early round investments for your startup. As the article says, this approach not only provides capital support but also extra value in terms of increased international visibility and credibility, strategic support, internal business opportunities (within the corporate ecosystem), and access to external customers. 

Have you considered CVC investment for your startup? If not, perhaps now is the time!

Hyperion supports post-investment cleantech startups and scaleups to build their teams at executive and mid-senior levels, right across Europe. We have a wide network amongst the startup ecosystem and investment communities. If you're looking for support on building your team, then we should talk. Get in touch at david.beeston@hyperionsearch.com