Klarna and Improbable identified as Europe's top founder factories

Swedish fintech Klarna and UK deeptech firm Improbable are Europe's leading companies for producing successful startup founders, according to a new report from venture capital firm Antler. The study identifies "real founder factories" – companies that act as talent incubators whose alumni go on to found successful startups.

The report analyzed over 51,000 startups across the UK, Germany, France, and Sweden that raised seed funding between 2010 and 2021. It found that employees who worked at a startup as it scaled from seed to Series C are nearly twice as likely to go on to build startups that themselves reach Series A funding.

This surge in success is attributed to the experience gained during critical growth phases. While only about 23% of European startups generally secure Series A funding, this figure jumps to 45.6% for founders who have direct experience working at a scaling startup. The report states, "No other previous employment or experience comes close."

Antler suggests that investors often overrate established names and overlook the potential of founders from less mainstream, but rapidly growing, companies. "Investors should pay more attention to the time a founder spent at a Series B logistics startup that's far less mainstream," said Christoph Klink, a partner at Antler. "We've felt this for a long time, and we're a little surprised to see it confirmed so heavily in the data."

The research also implies that experience gained just before a company's IPO is less valuable for a future founder than navigating a challenging Series A round. The challenge for European investors is now to update their filters to identify and back these promising founders early.