Discover the Proptech & Contech Index by AXC and RENT for Q3 2023

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Article Date
November 7, 2023

To monitor the developments and trends in the European Proptech & Contech ecosystem, Axeleo Capital and the RENT label have released the sixth edition of their 'Proptech & Contech Index,' covering the 3rd quarter of 2023. Q3 2023 turns out to be the most dynamic of the year with a clear increase in the amounts raised, although with a drop in the number of operations.

Biggest quarter of the year by the amount raised   

European Proptech and Contech startups raised a total of €628 million in funding during the third quarter of 2023, marking a significant increase compared to the second quarter of 2023 (€441 million, +42%). This figure even surpasses the funding raised in the third quarter of 2022, which amounted to €600 million during the same period last year.

This growth is primarily attributed to a relatively high number of 'jumbo rounds,' with four of such rounds taking place in Q3 2023, compared to only one in both Q1 and Q2 2023. Notable among these were Accenta, securing €108 million for their decabornization solutions, PV Case raising €89 million for their solar BIM technology, Poralium securing €84 million for their energy storage solutions, and Perenna raising €52 million for digital mortgage services. This trend embodies a maturation of the ecosystem, as it witnesses the emergence of genuine European industry leaders, effectively catching up with other sectors.

Other startups were not left behind, as there were still a total of 99 funding rounds in Q3, despite a slight 6% decrease compared to Q2 2023.

The Impact boom from the Q2 2023 confirmed

In the third quarter, the proportion of impact startups in total funding rounds remained significantly high at 41%. While this percentage is slightly lower than the 44% recorded in the second quarter of 2023, it still surpasses by far the standards set in 2022, which stood at 32%. This persistent upward trend reflects the sector challenges in energy efficiency and building renovation. The percentage of startups securing funding with at least one female founder also remains consistent with the figures for 2022 and 2023, standing at 16% in Q3 2023, compared to an average of 18% throughout 2022.

Less Nordics, a better distribution across all Europe, and less of a UK domination

While Q2 2023 saw great dynamism in the Nordics, this Q3 2023 stands out with an increase in the number of rounds in the countries of Eastern Europe (Hungary, Lithuania, etc.) and Southern Europe (Italy, Spain & Portugal). 

As for the top three, the dominance of the UK seems to diminish (21 rounds, far less than the Q1 2023 and its 37 rounds) caught up by Germany (19 rounds). France stands out with the largest fundraising in this quarter with Accenta (€108m).

Hardware aside, but Construction Technology and Energy Solutions still on top

Quarters follow one another but certain dynamics remain the same. Digital tools for Construction, Homes Energy Services and Property Management tools still collect the highest number of rounds (30% of the total in Q3 2023, ). There are therefore always fewer rounds for Market & Transact and Finance & Invest (20% of the total in Q3 2023, compared to 23% in Q1 2023, and even 43% in 2022). Professionals are not mistaken here because of the contraction in bank rates and the rise in construction prices. 

Web platforms & services and SaaS are more dominating than ever (48% of the total in Q3 2023, 44% in Q2 2023). Machine Learning and AI are shaking up the lines and offering new market opportunities (satellite analysis, grid management, etc.).

Methodology: The Proptech & Contech Index is based on data from Axeleo Capital's analysis as well as databases, Dealroom and Crunchbase in particular. These data sources mainly gather information on deals and rounds that have been publicly disclosed - many other raises are taking place, but without announcements or communications on amounts (thus difficult to track). The analysis is limited to companies with fewer than 250 employees, founded after 2010, headquartered in Europe, and with a value proposition focused on real estate and construction sectors. We also refer to venture capital fundraising only (i.e., excluding debt, grants, and non-equity financing).

For more information on the Proptech & Contech Index, click here.

To view the previous editions of the " Proptech & Contech Index " by Axeleo Capital & RENT, please see here. 

About Axeleo Proptech I:
Axeleo Proptech I is a €40M early-stage VC fund dedicated to proptech and contech startups across Europe. Axeleo Capital is a venture capital firm active in the European early stage tech scene and supported by a large pool of entrepreneur-investors. Axeleo Capital offers startup founders a unique support framework that combines equity investment, operational and strategic coaching and an active ecosystem of more than 100 high-level partners and mentors. Its Proptech investments include GarantMe, Check&Visit, Prello, Beanstock, Laiout, Bright Spaces... ‍

About RENT:
Created in 2013, RENT (Real Estate & New Technologies) is the must-attend event for innovation at the heart of real estate. The 11th edition of this major European event for real estate professionals (visitors) and technology professionals (exhibitors) will be held in November at Paris Expo - Porte de Versailles. RENT is also exporting at a European level with a participation to RENT Switzerland and PROPTECH EXPO, in collaboration with SIMAPRO, in Madrid.