New hope for European tech? VC funding up 12% to $30B in 2024

Whisper it, however startup funding is displaying indicators of a rebound.

Enterprise capital funding in Europe has risen by 12% thus far in 2024, according to Dealroom. By June, the financing for startups and scaleups had reached $29.3bn.

If the present spending charge continues, this 12 months will turn into third-most lively ever for VC within the continent.

The main business for funding is power, which raised $5.6bn throughout the first half of 2024. This continues a development from final 12 months, when power corporations topped the funding charts in each quarter.

There have been shifts, nonetheless, within the sector’s greatest targets.

Hydrogen corporations bagged the largest rounds in quarter two of 2024. The largest beneficiary was France’s HysetCo, which raised €200mn to develop hydrogen taxis. An additional €140mn went to Belgium’s Tree Vitality Options, which produces electrical pure gasoline from inexperienced hydrogen.

Synthetic intelligence, in the meantime, now contains 18% of Europe’s VC funding — up from 10% a decade in the past.

Wayve, a London-based startup growing AI for autonomous autos, topped the quarter’s investments with a $1.1bn Sequence C spherical. Throughout the sphere, generative AI introduced within the bulk of the money.

VC eyes on GenAI

GenAI attracted a report $2.6bn throughout the second quarter of 2024. It now makes up 10% of the continent’s whole enterprise capital funding.

Jeannette zu Fürstenberg, Managing Director and Head of Europe at VC firm General Catalyst, expects the momentum to proceed.

“We’re within the very early innings of one of many largest expertise sea adjustments in historical past,” she instructed TNW through electronic mail.

“As entrepreneurs and business leaders grasp the transformative energy of generative AI, they’re uncovering new enterprise fashions, merchandise, and kind elements.”

Common Catalyst is financing this imaginative and prescient. The agency co-led the quarter’s second largest VC funding in European GenAI: a $640mn Sequence B spherical for Mistral AI.

Zu Fürstenberg depicts the Paris startup as a flag-bearer for the continent.

“Mistral stands out not only for its groundbreaking applied sciences, but in addition for its adherence to European values and an open-source philosophy,” she mentioned.

“Seeing Mistral’s founding crew’s ambition and expertise caliber has undoubtedly inspired different traders to hunt out hidden gems throughout Europe.“

UK and France lead cost

Europe’s main nation for VC funding this 12 months is the UK. The nation has raised $9.4bn in whole, $6.8bn of which has gone to London-based companies.

Cambridge additionally makes the highest 10 European cities for funding. The town’s corporations have raised $664.6mn — up 83% on 2023.

Within the nation rankings, France took second place with $4.3bn. The bulk ($3.1bn) arrived in Paris, which the likes of Mistral have changed into an AI hub.

Geneva has additionally loved a profitable six months. The town has already raised extra within the first of 2024 ($385.7mn) than throughout the entire of final 12 months ($262mn).

Startups behind the increase embody biopharma firm iOnctura ($86.4mn), digital financial institution Alpian ($83.7mn), and drug growth agency Neurosterix ($63mn).

They show that synthetic intelligence isn’t the one subject elevating large rounds. For zu Fürstenberg, nonetheless, AI in Europe has a novel attract.

“Europe is usually a key participant within the immense financial alternative unleashed by AI, which I wish to name a European RenAIssance,” she mentioned.

“Leveraging the facility of AI to bolster European productiveness and development we consider can be key when constructing globally profitable expertise corporations on this continent.”