Europe's deep tech sector has shown surprising resilience in the face of a general global downturn for startups.
Europe's deep tech sector has shown surprising resilience in the face of a general global downturn for startups.
Europe's deep tech sector has shown remarkable resilience despite the challenges facing startups globally, according to the third annual report on deep tech in Europe published by Dealroom, Lakestar and Walden Catalyst. Despite an approximate 70% decline in fintech investment, the deep tech sector, with approximately $15 billion invested year-to-date in 2023, remains one of the most resilient categories of venture capital.
European deep tech market outpacing global trends
The deep tech market in the EU27 has shown remarkable resilience compared to other regions, achieving a 6% growth rate over the last 12 months. This contrasts with declining investment in other regions.
Emerging deep tech hubs
The report highlights the rise of deep tech hubs in Europe.London attracts $12.8 billion in deep tech funding between 2018 and 2023, followed by Stockholm ($10.3 billion), Paris ($7.7 billion), Munich ($4.9 billion), and Oxford and Cambridge combined ($9 billion).
Top countries receiving deep tech funding in 2023
Germany: $2.9 billion
France: $2.5 billion
United Kingdom: $2.2 billion
Education sector contributes to deep tech success
Europe's strong education sector is a key factor in the success of its deep technology industry. The continent accounts for six of the world's top 20 universities in computer science, has a highly educated STEM talent pool, and benefits from significant government and public support, including the $1 billion NATO Fund, programs such as SPRIND and JEDI.
New Artificial Intelligence and the Future of Computing
The report highlights the growing importance of new AI and the future of computing in deep technology. in 2023, European investment in new AI startups reached $1.3 billion, an increase of more than 50% from the previous year. In addition, investment in startups working on future computing is up 10% in 2023 compared to 2022, with significant funding for quantum computing startup Pasqal (€100 million Series B) and AR/VR startup Aledia ($120 million Series D).
A paradigm shift in computing infrastructure is inevitable as AI models become more complex, Moore's Law approaches its limits, and societal factors become more pressing. The future of computing lies in developing the architectures and technologies of the future to drive innovation and foster a new era of prosperity.
The report concludes by emphasizing Europe's strong position in the global deep technology space and its potential for leadership in developing the technologies that will shape the future.
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November 18, 2023
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