Web Summit x Crunchbase funding report

“Web Summit is great for us, as it’s the one week each year when we reconnect with many investors who visit Lisbon year after year for the event. Seaya Ventures visited our lab store during the event and by December, we were in Madrid signing the term sheet, leading our Seed round the following year. Also we attended Web Summit Rio in Brazil, where we met Kamay Ventures, the investment arm of Coca-Cola and Arcor Group, which joined our recent Series A funding round.”

– Joana Rafael, co-founder and COO of Sensei. Sensei is a Portuguese startup focused on autonomous retail technology.

$60 billion raised, with cleantech leading the funding race among startups

Web Summit brings together a global community of founders, entrepreneurs, business leaders, and investors to connect and exchange ideas about the technology and trends shaping the world. Since launching in 2009, Web Summit has been dedicated to creating an experience at its events that drive meaningful connections for young entrepreneurs alongside hosting the most critical conversations about technology and society. 

Through its flagship events in Lisbon, Rio, Qatar, Vancouver, and Asia, Web Summit has become known as the largest gathering of startups in the world. Just this year, Web Summit in Lisbon is set to feature a record breaking 3,000 startups and 1,000 of these will be women founded. 

For more than a decade, young entrepreneurs and next-generation thinkers have taken to Web Summit to propel their business, meet the right investors and business partners and tell their company’s story. The relationships formed at Web Summit events over the years have led to remarkable advancements, from investment opportunities to seminal partnerships to the birth of new, game-changing companies. 

In partnership with Crunchbase, a leading platform for private company intelligence, Web Summit aimed to capture a snapshot of funding flows into companies within 12 months of attending the event. This analysis offers insight into emerging trends and hot sectors, showing how they align with broader market movements and where capital is flowing for early-stage startups that could soon become household names.

A word from Web Summit and Crunchbase

Paddy Cosgrave, CEO of Web Summit, said: “I’m delighted to have Crunchbase, a trusted leader in startup data, collaborate on our first ever funding report, examining where investment is flowing for startups attending our events.” 

Cosgrave said the data had revealed a number of trends which will be closely analysed across the tech sector.

“There is an incredible surge in investor trust in cleantech: meanwhile investor sentiment appears to have cooled substantially towards fintech and e-commerce startups. What I find most interesting is that while overall funding is down globally in 2023, especially for early stage startups, Web Summit has more startups than ever before joining our Startups Programme and 75 percent of these are early stage startups. Throughout the years, these startups tend to outperform the market in average raises,” he said. “In a landscape of tightened financing, Web Summit is a crucial platform where early to late-stage startups can connect with a vast array of VCs and partners to propel their businesses.”

Crunchbase CEO Jager McConnell welcomed the report, saying: “It’s exciting to see the Web Summit team leverage Crunchbase’s proprietary private company data to assess how attendee startups have performed against broader market and industry trends.” And he added:

“As a long-time attendee of Web Summit events, I’ve had the privilege of meeting many impressive founders there, so I wasn’t surprised to learn how participants have outperformed the market by several key metrics. I look forward to tracking many of these impressive startups via Crunchbase as they grow and become household names.“

Categories of companies 

For this report, we organised our research into three categories, focusing on the stage of companies and their participation at Web Summit, our flagship event that gathers 70,000 tech leaders, entrepreneurs, and investors to Lisbon each November. We analysed the funding these companies secured from investors within 12 months of attending, covering the period from Web Summit 2021 to 12 months after Web Summit 2023.

Startup programme 

Firstly, and most importantly, we wanted to capture the funding received by the startups who participated in Web Summit’s renowned startup programme, which gives early stage startups who have raised less than $20 million the chance to exhibit and take part in exclusive investor meetings, mentor hours and more. We believe this is the most interesting cohort to watch and analyse given it is likely an indicator of what is hot in the sector.

All startups 

Similarly, we wanted to see where investor money went when looking at companies that participated in Web Summit who were early to late stage startups. This would capture what we believe to be the most accurate picture for startups generally and can capture the success and funding from those who have attended as speakers, founders, executives, chairpeople and attendees. 

All companies

The last category comprises all companies who received funding within the 12 months of attending Web Summit from Web Summit 2021, Web Summit 2022 and Web Summit 2023. This includes all types of funding from pre seed to late stage to pre-IPO debt financing.

General funding trends

Startup programme  

• Startups who take part in Web Summit’s renowned startup programme, which supports early-stage companies with less than $20 million raised.

In 2021 the average raised by attending startups taking part in the startup programme was $8.7 million. This was substantially higher than the market average, which was $3.4 million for startups globally. Breaking this down, of the 1,519 startups exhibiting at Web Summit, 189 companies raised $1.7 billion. 

The average raised by early-stage startups globally in 2022 was $3 million, according to Crunchbase’s data. However, the Web Summit startup programme cohort once again beat the market by raising on average $3.4 million. Out of the 2,296 startups from the Web Summit 2022 cohort, 255 successfully raised a total of $861.5 million between them. This total was nearly $1 billion lower than the 2021 figure – a decrease which corresponds with tightening of funding alongside increased interest rates in The United States and Europe since 2022.

Crunchbase data shows that  the 2,608 startups who were part of the Web Summit 2023 startup programme cohort raised on average $4.6 million – which beat the market average for equivalent firms by more than $1 million. In total,  171 Web Summit startups raised $755.1 million – which was once again down from 2021 by more than a billion dollars. 

All startups

• All early to late stage startups, providing a clearer picture of startup success for those who participated as speakers, founders, executives, or attendees.

Breaking it down further, we saw 249 startups (incluing all early and late stage startups) raise $12.2 billion after attending Web Summit 2021.

2022 saw a substantial dip in funding raised, down to $4.4 billion. However, the number of companies which raised was higher than previous year, at 289.

In 2023, however, 293 startups which attended Web Summit raised $11.4 billion within the year of attending.

All companies 

• All companies that secured funding within 12 months of attending Web Summit 2021, 2022, or 2023. It covers all funding stages, from pre-seed to post-IPO debt financing.

241 companies raised $60.6 billion within the year of attending Web Summit 2023.

This is up from 342 companies raising $30.1 billion in the year after Web Summit 2022, and 289 companies raising $40.1 billion in the year after Web Summit 2021.

Industry breakdown: Startup programme

Examining the Web Summit startup programme cohort over the three-year period from Web Summit 2021 to 12 months after Web Summit 2023, the data reveals a significant shift in investor sentiment, with cleantech seeing the strongest growth and fintech experiencing the steepest decline.

Sustainability and cleantech firms raised $169 million after attending Web Summit 2023 – representing 22% of the overall fundraising pie for Web Summit startups.

This is a dramatic rise from $72.9 million in 2022 and $40 million in 2021. 

Meanwhile, despite Crunchbase reporting a “cooling interest” in investment for SaaS startups, with funding only reaching $4.7 billion between January and May 2024. SaaS firms came second to sustainability by raising $120 million in the year since they attended Web Summit 2023.

While SaaS remains in the top 10 performing industries, the money flowing into the industry has been volatile. A mere $99 million was raised 12 months after Web Summit 2022 which is a significant  dip from $201 million the previous year.

While AI has generated the most hype – and the biggest single raise in history for OpenAI – it is not yet getting the lion’s share of early stage startup funding, the Crunchbase data shows. AI and machine learning startups has continued to make in roads raising $72.6 million – amounting to 9% of total funds raised within the year of Web Summit 2023. Funding reached similar levels in 2022 with $78 million and $71.6 million in 2022 and 2021 respectively.

However it was a very different picture for fintech startups, which had enjoyed several years of significant fundraising. Fintech funding plummeted to just $25m in 2023, from $252m in 2021 and $231m in 2022. The latest figure represents just 4.5% of all startup funding for Web Summit startups – whereas it had been 30% the year before. 

E-commerce funding also fell to just $6m in the past year,  from $713m in 2021 and $40m in 2022. The latest figure represents just 1% of overall funding raised for all startups, early to late stage. In 2021, E-commerce had bagged over 42% of all startup funding.

Meanwhile mobility startups are also struggling compared to previous years: they raised $25m in 2021, $53m in 2022 but just $2.5m in 2023.

Top performing startups: startup programme 

Of the 171 startups who raised from the Web Summit 2023 cohort, the following ten raised the highest amount through various types of rounds.

Instagrid

BETA startup, German portable battery maker Instagrid raised $95 million in a Series C funding round led by the Ontario Teachers’ Pension Plan and Morgan Stanley’s 1GT climate fund. This funding brought the company’s valuation  over $400 million, enabling its expansion to North American markets.

Protect AI

BETA startup, AI and ML security firm Protect AI, which safeguards AI systems throughout their lifecycle, raised $60 million in Series B funding led by Evolution Equity Partners, bringing its total funding to $108.5 million, with participation from investors like 01 Advisors, Samsung, and Salesforce Ventures.

Pale Blue

BETA startup, Pale Blue, a Japanese startup specialising in propulsion systems for small satellites, secured approximately $16 million in Series B funding. The company aims to advance the development and demonstration of its water-based thrusters, while also establishing new production capabilities and expanding its team to support future space mobility solutions.

LiveEO

GROWTH startup, LiveEO uses AI and satellite data to help businesses manage climate risks and infrastructure resilience, raising €25 million to expand its innovative solutions.

Vertice

GROWTH startup, Vertice, a London-based spend management platform, helps finance teams optimise software and cloud costs, having raised $52.5 million since its 2021 founding.

SurrealDB

GROWTH startup, SurrealDB, a multi-model database platform, raised $20 million from FirstMark, Georgian, Crew Capital, and Alumni Ventures to streamline database consolidation for developers, launching its new cloud beta to enhance flexibility and scalability.

Codesphere

BETA startup, Cloud coding startup Codesphere secured $18 million in funding led by Creandum, with participation from LEA Partners, Begin Capital, 42CAP, and 468, to reduce infrastructure costs and enhance cloud-based app development scalability.

Aikido

BETA startup, Aikido has raised $17 million in a Series A round led by Singular.vc, with participation from Notion Capital and Connect Ventures, to simplify security for developers and SMEs by integrating compliance standards into an easy-to-use, open-source platform.

Banxware

GROWTH startup, Berlin-based fintech Banxware raised €10 million in a seed extension led by Element Ventures, with participation from D4 Ventures, FinVC, and Varengold Bank AG, alongside existing investors Force over Mass, VR Ventures, and HTGF, to expand its embedded business lending solutions for digital platforms.

Categories of funding trends: Startup programme and startups

From 2021 to 2023, startups showcased through the Web Summit startup programme navigated a challenging funding landscape marked by volatility, mirroring broader venture capital trends that defined the startup ecosystem in 2023.

Initially, angel funding surged by 68%, climbing from $2.86 million in 2021 to $4.8 million in 2022, only to plummet by 91% to a mere $0.40 million in 2023.

Pre-seed funding exhibited similar fluctuations, dipping from $33.78 million in 2021 to $27.07 million in 2022, before modestly recovering to $30.38 million in 2023.

Seed-stage funding experienced robust growth in 2022, reaching $215.08 million,only to contract by 33.18% to $143.72 million the following year, as investors grew more cautious.

Overall, Series B funding faced the steepest decline, falling from an impressive $524.26 million in 2021 to $115.17 million in 2022, and slightly decreasing to $111.81 million in 2023.

Notably, the Series C stage displayed unexpected resilience, rebounding from $50 million in 2022 to $154.9 million in 2023, indicating that some startups showcased at the Web Summit managed to navigate the downturn effectively. 

Overall, the evolving funding dynamics reflect a pivotal shift toward sustainability and careful capital deployment, encouraging startups to adopt more efficient and profitable business models in the face of economic adversity.

Changing nature of startup funding: the rise of debt

While startups in the Web Summit startup programme experienced a massive decline in debt financing, the same category of financing emerged as the most prominent funding source for the wider group of all startups. 

In 2021, 17 percent of funding raised by Web Summit startups came in the form of debt financing, at $2 billion. While debt financing became the top category of funding in 2022, it dropped by $700 million from the same period a year previous, totalling $1.3 billion. 

By contrast, of the $11 billion raised by all startups, early to late stage, in Web Summit 2023, $9 billion was raised through debt financing. This counts as a staggering 79 percent of all startups funding and suggests a shift towards leveraging debt due to tighter equity markets. It also highlights the tendency for debt to be the preferred fundraising route for later-stage startups.. 

“The massive shift in funding among later-stage startups, from equity financing to debt financing, is also an extraordinary trend identified by this research,” said Cosgrave. “Three years ago, debt financing accounted for just 18% of all funding raised by this cohort: last year, it accounted for 85% of all funds raised among this group.” 

“It’s important that we examine this shift, and consider what the implications may be – both for startups and for public policy. While there can be perceived advantages to debt financing – such as founders retaining more control, or in some cases being able to reduce tax liabilities – the industry should also be considering the potential risks. These can encompass everything from adverse credit ratings in case of a default, right up to the risk of losing control of a business. Is debt financing an ingenious solution to the recent reduction in availability of private equity, or a more worrying trend which will have longer-term implications for the companies trying to build the future?” – he continues

A closer look at specific investment types reveals a diverse funding strategy among investors for the wider group of startups. Both Series C and Series D funds managed to raise significant amounts, with Series C accumulating $885 million and Series D reaching $2.08 billion. 

Vlada Musvydaite Vilciauske, CEO and Founder of Walk15, said: “Web Summit is a vital platform for startups who are often overlooked despite their big ideas. In 2022, Web Summit connected us with EIT Urban Mobility Impact Ventures – our first foreign fund. Since then, we have raised €2 million, with investments from Vinted Co-Founder Mantas Mikuckas, Coinvest Capital, the NGL, Litban, Dailides family and etc. We are grateful for this fuel to execute action toward a healthier society and a greener planet.”

Conclusion: 

While this report analyses the last three years of Web Summit’s flagship event in Lisbon, more than a million attendees have walked through  Web Summit’s doors in cities around the world and formed incredible relationships that have helped drive their businesses forward. The emphasis on meaningful connections has always been central to Web Summit’s mission, facilitating relationships that drive business growth and innovation. 

Despite the current decline in startup funding, it is essential to view this report as an data-driven assessment of market trends as reflected by the thousands of startups participating in Web Summit each year. The event serves as a critical lens through which emerging trends can be observed, enabling a comprehensive understanding of the entrepreneurial landscape. By leveraging its position as the largest gathering of entrepreneurs globally, Web Summit can identify early indicators of what is gaining traction and what is not.

The first Web Summit funding report, produced in collaboration with Crunchbase, aims to provide valuable insights that can stimulate ideas and reflection within the startup community. Moving forward, we will continue to analyse our data to share compelling stories and insights about the evolving startup ecosystem.

Startup? Our startup programme for 2024 now reached capacity, but you can still sign up now to learn more about ticket packages for Web Summit 2024 exclusive to startups.