Today’s Insights 🔍 

• Crypto startups globally

• A music blockchain startup

• VC investments in crypto

• Crypto hubs in Europe

Read Time: 2.5 minutes

Worldwide Crypto Startups 📊 

Europe has the highest concentration of crypto startups with over 35% of early-stage crypto ventures. There is over 11,000 crypto startups globally, with the two major hubs being the US & Europe.

Europe leads in crypto startups as it leverages a supportive regulatory framework which provides clarity and safety across blockchain investments. It also benefits from a deep tech talent pool for fintech which represents 52% of crypto startups (with 32% infrastructure & 16% Web3).

Weekly Startups News 🧑‍💻

Microsoft’s AI Ambitions Beyond OpenAI
Microsoft announces a deal with French AI start-up Mistral, a leader in open source language models, to expand its presence in the AI economy.

Copenhagen-based crypto startup raises seed extension
Januar secures a €1.5 million seed extension to bolster its financial infrastructure for crypto businesses. The firm unveiled a new platform for seamless fiat-to-crypto conversions.

Verdane closes €1.1B Edda III fund
The Norwegian private equity firm announced the final close of its fund, which will invest in European companies that help digitalise and decarbonise the economy.

Startup feature
The blockchain startup making music an asset

The Swedish based startup Anotherblock is democratizing music ownership as an asset. Featuring artists such as Rihanna, The Weeknd & Justin Bieber the blockchain-based platform provides fractionalized shares of song rights.

It allows anyone to own a share of their favorite songs and earn royalties alongside the artist & producer based on the number of streams these songs receive.

Since their launch in 2022, the music startup has raised close to $6 million in total funding aiming for a more extensive range of music, as well as new talent which currently includes a team with experience from Spotify, Universal Music & Nasdaq.

The music rights category already receives $5bn in institutional investments. As it is for many other blockchain and crypto based startups, Anotherblock is leveraging the fast-paced technology to disrupt a previously opaque market controlled by large institutions.

VC investments in crypto ⚖️

European crypto startups receive the majority of their investments from American VCs. With a total of $5.9bn dollars invested in European crypto startups for 2022, a near 70% of this investment was from non-European VCs.

This highlights the risk averse nature of European VCs which due to the strict nature of government capital and more risk averse approach of institutional LPs have a lower risk tolerance than US investors.

Crypto hubs in Europe 💹 

Across Europe, several key hubs have emerged for crypto startups. A primary location being London due to the international investors familiar with UK regulations, in addition to the UK attracting nearly 40% of the overall startup investments for Europe YoY.

Two other key hubs that have formed include Zurich & Berlin. Switzerland benefits from versatile and private banking regulations, while Berlin benefits from an immense tech talent pool required for the quick to innovative blockchain space.

SearchVentures Insights

The data underscores Europe's leadership in the crypto startup ecosystem, with a 35% share of global early-stage ventures located in the region. This is driven by conducive regulatory environments and a strong talent pool, enabling innovation in blockchain and fintech sectors.

A key insight is European crypto startups drawing significant international VC interest, revealing a divergence in risk strategies between European and global investors, highlighting the important role of foreign investment for crypto startups.

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Cheers,

Odin Lund & Hariprasad Mohandas