Atomico Invests $1.24 Billion in European Tech, Including Klarna

Atomico, a prominent venture capital firm known for its early backing of European tech giants like Stripe and Klarna, has launched two new funds totaling $1.24 billion to support emerging and growth-stage startups in the sector. The move comes as a much-needed boost to the European tech scene, which has been grappling with declining valuations and widespread layoffs.

The new funds include a $754 million growth-stage fund targeting Series B to pre-IPO companies and a $485 million early-stage fund focused on Series A and Seed investments.

The growth fund, Atomico Growth VI, will support entrepreneurs from Series B through to pre-IPO stages. While, Atomico Venture VI will continue to engage with early-stage founders, focusing primarily on Series A, with some opportunities at the Seed stage.

Klarna's IPO Plans and the European Tech Landscape

The announcement comes as Atomico's prominent portfolio companies, Stripe and Klarna, are rumored to be considering stock market listings. Stripe, valued at $70 billion in its last secondary share sale, is seen as a potential IPO candidate, while Klarna is exploring a secondary share sale to provide liquidity ahead of a highly anticipated IPO.

While this year has seen fewer major tech listings in Europe, there is optimism for a revival in 2025.

Klarna is a Swedish fintech company that provides online payment services and buy now, pay later options. It's a major player in the European fintech landscape, and its IPO is being closely watched by investors and industry experts.

Atomico's Focus on Early-Stage Startups and Series A Funding

Atomico, founded by Niklas Zennström, co-founder of Skype, has been a key player in supporting Europe's tech ecosystem. The firm has evolved from Series A investments to include growth funding since 2011.

Zennström believes that European technology is reaching new heights and that founders need investors with the right experience to navigate market cycles. Their new funds will help early-stage startups scale globally from Europe.

Atomico's focus on early-stage startups and Series A funding is crucial for the growth of the European tech sector. Series A funding is often the most difficult stage for startups to secure, and Atomico's support can make a big difference in their success.

Challenges Facing European Tech Startups

In 2023, venture funding for European tech startups dropped to $45 billion, down from $82 billion the previous year, reversing the surge in tech valuations seen before the pandemic.

Despite this decline, the total value of all private and publicly listed tech companies in Europe exceeded $3 trillion in 2023.

However, Europe’s tech sector experienced a $400 billion reduction in market capitalization in 2022 due to falling valuations.

Atomico's Investment Strategy and Support for European Startups

Atomico's new funds represent a more than 50% increase over the $820 million raised in its previous round, Fund V, in 2020.

This significant investment demonstrates Atomico's commitment to supporting European tech startups, even in challenging market conditions.

Atomico's investment strategy is focused on backing ambitious founders who are building world-class businesses. They believe that Europe is home to some of the most innovative startups in the world, and they are committed to helping them achieve their full potential.

The Importance of Atomico's Support for the European Tech Ecosystem

Atomico's investment in European tech startups is crucial for the growth and development of the sector. The firm's expertise and network provide valuable support to founders, helping them navigate the challenges of scaling their businesses.

Atomico's investment in Klarna, Stripe and other European tech startups has had a significant impact on the sector. These companies are now global leaders in their respective fields, and their success has inspired a new generation of entrepreneurs.