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Europe is emerging as a global factor in deeptech, a sector characterized by novel scientific or engineering breakthroughs that make their way into transformative products and companies for the first time. As highlighted in a report by Dealroom, Europe’s unique combination of robust fundamental research, a highly skilled talent pool, and increasing public support sets the stage for unprecedented growth and innovation in deeptech.

The Resilience and Growth of Deeptech

Amidst a challenging economic landscape, deeptech has demonstrated remarkable resilience within the venture capital space. In 2023, deeptech funding in Europe reached $15 billion, nearly matching the figures from 2022. This steadfast performance stands in stark contrast to sectors like Fintech, which experienced a significant decline.


Geographical analysis of deeptech funding reveals a concentration of investments in key regions, with the UK, France, and Sweden leading the way. Notable innovation hubs such as Stockholm, London, Paris, Grenoble, and Munich have emerged as critical centers of deeptech activity, each benefiting from significant mega-rounds that bolster their respective ecosystems.

Key Drivers: Public Support and Talent

Europe’s ambition to become a deeptech leader is supported by robust public initiatives. Programs like the European Innovation Council (EIC), the €1 billion NATO fund, SPRIND, and JEDI offer crucial funding and resources to nurture deeptech startups. This public backing is bolstered by a societal sentiment that overwhelmingly views science and technology in a positive light, with 90% of Europeans recognizing their beneficial impact.


The continent is home to a rich talent pool, with European universities producing a high number of STEM graduates. Institutions such as Cambridge, Oxford, ETH Zurich, and TUM are at the forefront of this educational excellence, supplying the talent needed to drive deeptech innovation. However, aligning technical prowess with business acumen within deeptech teams remains a key area for improvement.

Funding Landscape and Investment Trends

Europe’s deeptech funding landscape is diverse, featuring a range of investors including dedicated deeptech funds, sector-agnostic funds, and corporate investors. While early-stage investments dominate, there is growing recognition of the need for more late-stage, deeptech-focused capital to support the scaleup of these ventures.


Recent successful deeptech exits, such as the IPO of ARM and BioNTech’s acquisition of InstaDeep, highlight the potential for substantial returns in this sector, attracting more investors to the field.

From Obstacles to Opportunities

Despite the promising outlook, several challenges must be addressed to fully realize Europe’s deeptech potential:


  • Encouraging Entrepreneurship: More initiatives are needed to attract entrepreneurs to deeptech. Programmes that foster an entrepreneurial mindset and support startups are essential.
  • Harmonising Terms for University Spinouts: Simplifying and standardising the terms and processes for university spinouts can facilitate the transition from research to viable businesses.
  • Creating Dense Talent Clusters: Forming clusters of talent and excellence can enhance collaboration and innovation within the deeptech ecosystem.
  • Increasing LP Base and Institutional Involvement: Expanding the base of limited partners (LPs) and engaging more institutional investors can provide the capital necessary for growth.
  • Strengthening Exit Channels: Improving pathways for exits, whether through IPOs or acquisitions, can make the sector more attractive to investors.
  • Promoting Diversity: Ensuring diversity among founders and investors is crucial for fostering an inclusive and innovative environment.

The Road Ahead: Embracing Coopetition

To navigate the above challenges, a unified approach that embraces coopetition—where competitors collaborate for mutual benefit—is crucial. By working together, European countries can leverage their collective strengths to build a more robust and deeptech ecosystem. This collaborative spirit, combined with Europe’s strong research foundation, educated workforce, and supportive public policies, positions the continent as a potential global player in deeptech innovation.


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