Europe

Despite expectations that deal volume might begin to show a true rebound in Q1’25, the number of VC deals in Europe fell to a nine-year low amid a fresh wave of geopolitical and economic uncertainty driven in part by concerns related to the new US administration’s announcement of various tariffs regimes.

During Q1’25, VC investors in Europe continued to show significant interest in AI, although deal sizes were relatively subdued compared to previous quarters — partly due to the absence of big raises by LLM-focused companies. Startups focused on industry applications of AI saw the strongest interest in Q1’25, with companies in the health and biotech (Neko Health — $260 million, Cera — $150 million) and enterprise communications (Synthesia — $180 million) spaces raising large rounds.

The European Commission showed very strong commitment to the evolution of AI in Q1’25 with the announcement of its $206 billion InvestAI program,1 including significant funding for the development of gigafactories. In Q1’25, France also announced $112 billion in committed AI investments, including €20 billion from Canada-based investment firm Brookfield for AI-focused projects in the country.2

investment in the health and biotech sector was robust in Q1’25, with numerous $100 million+ funding rounds across the region, including raises by UK-based Verdiva Bio ($410 million) and Cera ($150 million); Sweden-based Neko Health ($260 million); Switzerland-based Windward Bio($200 million), Numab ($194 million), CeQur Simplicity ($120 million), and Ireland-based Fire1 ($120 million). The diversity of investments across both geographies and focus areas (e.g. obesity therapeutics, oncology treatments, insulin delivery wearables, digital healthcare solutions, medical scanning) highlights the continued strength of investor interest in all areas of health and biotech, from health management and monitoring to medical devices, digital health, and disease prevention.

VC investment in the Nordic region fell quarter-over-quarter, although investors continued to show interest in areas like healthtech and cleantech. During the quarter, Sweden-based preventative health technology company Neko Health raised $260 million, sustainable energy services company Elvy raised $153 million, and Finland-based low carbon hydrogen producer Hycamite raised $45.8 million. Current geopolitical uncertainty, tariffs and trade tensions may prolong the stagnate state of the Nordic VC investment further down 2025.