Balderton Capital and Dealroom: European AI startups attracted 25% of the region's VC funding, or ~$13.7B, in 2024, compared to 15% in 2020
Anna Heim / TechCrunch : X: @dorialexander and @jamespaulwise LinkedIn: Ofer Mintz and James Wise X: Alexander Doria / @dorialexander : @Xenoimpulse Clearly not the best moment but infra is good, economic lag is amplified by bad dollar/euro exchange rate. AI is probably the first time EU does not seem to miss out completely on a tech shift: https://techcrunch.com/... James Wise / @jamespaulwise : I shared some data in @TechCrunch today on why the negative narrative around the EU & UK AI sector isn't supported by the data. Start-Ups started here have raised $100Ms & $1B rounds this year to grow globally. Some of the fastest growing companies in terms of $ per FTE are LinkedIn: Ofer Mintz : 1/4 of all VC funding in Europe in 2024 went to AI startups. Quite a large percentage, showing among other positive things … James Wise : As we come to the end of the year, I shared some thoughts with TechCrunch (supported with great data from Dealroom.co) on why we should be far more optimistic about the EU & UK ‘AI’ sector. …
Context & Ripple Effects
The finding arrives as Europe’s overall startup fundraising was expected to soften in 2024, even while AI drew a larger share of the available pool. A subsequent breakdown found that most 2024 European AI funding was concentrated in seed through Series B rounds, indicating that the shift was not limited to a handful of mature companies.
This makes AI’s rising share more consequential than a headline funding total: it signals a reallocation within a constrained European VC market. Later coverage shows that AI’s pull on capital continued, with AI leading European venture investment in 2025 even as North American funding grew faster.
First-order effects
- European AI founders gain a stronger claim on scarce VC attention, while non-AI companies compete for a smaller relative share of regional venture funding.
- Balderton and Dealroom’s data gives investors and founders a benchmark for positioning European AI as a material funding category rather than a peripheral one.
Second-order effects
- Generalist European funds face pressure to build AI investment capacity or risk losing competitive rounds to specialist and cross-border investors.
- As AI valuations help support European deal value, capital may become more unevenly distributed across sectors; Dealroom later identified AI, fintech, and defense as drivers of that valuation lift.
Third-order effects
- If AI continues to take an expanding share of European VC, the region’s startup economy could become more dependent on a narrower set of capital-intensive technology categories, even if total funding remains subdued.
- The pattern also raises the strategic importance of later-stage funding sources: US investors’ growing participation in European AI rounds suggests local early-stage formation does not by itself determine who finances scale-up.
The trend: European venture capital is increasingly concentrating around AI, with the key unresolved question being whether European investors can fund companies through their more expensive growth stages.