Europe

VC investors in Europe continued to invest in AI in Q2’26, increasingly prioritizing AI-native companies over software companies adding AI to existing offerings. The UK saw the largest AI funding rounds in Europe, including Isomorphic Labs’ $2.1 billion raise, autonomous driving company Wayve’s $1.3 billion raise and Ineffable Intelligence’s $1.1 billion raise.

Defensetech has evolved from an off-limits area of VC investment into one considered mainstream in Europe, driven by protracted geopolitical conflicts and the increasing focus of governments on sovereign defense capabilities. Investors showed interest across autonomous vehicles, drones, spacetech, intelligence, secure communications, cyber solutions and dual-use technologies. France-based Aura Aero raised €50 million in equity funding as part of a broader €340 million financing package, while a UK-based defense firm announced investments into two defensetech VC funds during the quarter.

VC activity in the Nordics continued its strong momentum in Q2’26, reaching $4.6 billion across 213 deals — the region’s strongest quarter since Q1’21 — as investors continued to prioritize AI, defense technology, cleantech and other deeptech investments. The quarter included several sizable Nordic rounds, most notably Stegra’s $1.6 billion late-stage VC financing in Sweden and ICEYE’s $1.2 billion Series F round in Finland. While many investments in the region have been concentrated at earlier stages to date, the speed at which some startups are scaling could quickly translate into larger VC rounds and companies beginning to consider IPO opportunities. Deeptech also continued to gain attention across the Nordic region, although some startups have found it challenging to navigate later-stage funding routes. In Finland specifically, one notable recent trend has been the growing participation of pension funds in late-stage VC investing, driven largely by regulatory changes to allocation models