Summarizing the month in European dealmaking.

Discovery risk is for VCs like yesterday's newspaper. With the Big Pharma market for discovery tools abysmally quiet, early-stage funding for such firms saw a steep decline.

Private financings were down in 2002 across all sectors -- just 353 were completed, versus 438 in 2001 and 504 in 2002. The biggest stacks of money went to start-ups with the potential to bring numerous products to market, particularly to spin-offs. Quite a few of the big financings went to private companies that almost certainly would have launched a public stock offering if times were better. Start-ups lacking superstar pedigrees are now competing against public firms whose stock prices have fallen, as the dismal market encourages investors to expend their efforts on organizations and products that already exist. Cyclical as markets may be, this trend isn't likely to evaporate even if the financing climate warms up in 2002.