Venture Capital Overview Fundraising 2,000 1,600 1,200 800 400 0 2018 2019 2020 2021 2022 2023 Fundraising € Millions Investment 2,200 1,600 1,200 800 400 0 2018 2019 2020 2021 2022 2023 Investment international VC Investment domestic private VC Investment domestic public VC € Millions Divestment 400 300 200 100 0 2018 2019 2020 2021 2022 2023 Divestment € Millions Main conclusions for 20231 Venture Capital Following the highs recorded in 2022 and 2021, the volume of Venture Capital investment in Spanish start-ups in 2023 fell by 58% to €899M,2 recovering pre-pandemic levels. This decrease can be explained by lack of large funding rounds for start-ups in more advanced stages, primarily “late stage venture”3 and, to a lesser extent, for Series B/C or “other early stage”4. Rounds above €10M lost momentum: A total of 16 start-ups took part in rounds above €10M compared to 28 the previous year. There were no rounds above €100M compared to 6 in 2022. The innovation ecosystem continues to grow: 687 Venture Capital investments5 were made in 2023 (third best figure on record) to fund 424 Spanish start-ups. The number of start-ups that received follow on funding (55%) surpassed the number of start-ups receiving funding for the first time6. Domestic private Venture Capital firms continue to drive the Spanish innovation ecosystem despite a difficult environment for this activity. In 2023, investments totaled €330.3M (-18% compared to 2022) in 438 investments (-11% compared to 2022), the majority of which (82%) were investments to support companies in the earliest stages. Public Venture Capital firms increased their direct investment in start-ups in 2023, totaling €138M, an all-time high. Their investment activity in the IT and life sciences sectors stood out. The investment of private and public domestic Venture Capital firms exceeded the investment of international funds for the first time since 2013. The international Venture Capital funds’ activity fell by 73% compared to 2022 due to the fewer large funding rounds for scale ups (late stage venture). Nevertheless, international funds maintain a heavy presence in the Spanish innovation ecosystem, making a high number of transactions (121 in 75 start-ups). A total of 103 international GPs made at least one investment. The majority of these were in start-ups in more mature stages. As at the end of 2023, 296 of the 420 international entities with Spanish portfolio companies were Venture Capital firms. At the national level, the sector has 125 firms investing in Venture Capital7, 16 of which are public. Venture Capital investment in terms of GDP reached 0.061%, slightly surpassing the European average (0.059%)8. The entrepreneurial ecosystem generated value thanks to Venture Capital investment. Regarding the ability of Venture Capital investment to attract funding from other co-investors towards start-ups, i.e. transaction value, defined as the sum of total equity invested by Venture Capital GPs (€899M) plus investments made by other co-investors (€798.4M) totaled €1,697M in 2023. Notes