Amid rising geopolitical tensions, the US, Europe and China are all vying to secure homegrown capabilities in key tech.
More European policymakers say losing out on the global innovation race will threaten the region’s ability to defend its interests and even its own sovereignty.
Sifted has compiled a list of 25 privately owned deeptech startups and scaleups at the heart of Europe’s battle for technology sovereignty.
Companies on this list have raised more than $100m from investors and were founded post-2005. They are working on areas that will help Europe remain competitive, from AI to quantum computing. Their technologies could have a major impact on the future of the global economy.
H2 Green Steel — Sweden
The Stockholm-based company is what Sifted has termed an “infrastructure startup” — a climate tech with large capex (capital expenditure) needs that have become more common in Europe. The scaleup wants to produce so-called green steel, cutting down the CO2 emissions produced in the steelmaking process by up to 95%, at its facility in Boden, northern Sweden. Its tech is key for the energy transition and manufacturing in Europe, earning it a place on our list. Earlier this month, it raised a massive €1.5bn equity round from an investor group led by Altor, GIC, Hy24 and Just Climate.
Northvolt — Sweden
Northvolt is the continent’s best-capitalised gigafactory scaleup, having raised a jaw-dropping $9bn from investors, including €1.2bn in convertible bonds in August. With one factory already operating in Sweden, and three new ones planned for Sweden, northern Germany and North America, the company is seen as a key player in the green transition; its batteries are used in electric vehicles.
Northvolt is also reportedly imminently preparing to raise more than $5bn in equity financing ahead of a planned stock market listing, possibly next year.
Verkor — France
Another key gigafactory scaleup in Europe, Grenoble-based battery producer Vektor secured €2bn in financing earlier this month to build a facility in Dunkirk. The financing included €600m from the European Investment Bank and €650m in state subsidies. The gigafactory is expected to create 1,200 jobs and launch in 2025 with an initial production capacity of 16 gigawatts (GWh) a year.
The announcement comes as French President Emmanuel Macron pushes to attract investment in EVs and compete with US and Chinese subsidies. High on Verkor’s to-do list now: securing its supply chain through deals like the one it’s inked with Renault to have access to Morocco’s cobalt.
Morrow Batteries — Norway
A scaleup founded in 2020, Morrow manufactures battery cells enhanced with graphene, which grants them higher electrical conductivity than lithium-ion batteries. They also charge faster — a feature sought by electric vehicle manufacturers.
Headquartered in Oslo, it will open the first battery cell factory in Arendal, southern Norway, next year, onshoring its production from South Korea. The company aims to produce 43GWh hours annually at the site from 2028 — enough to power some 600k electric vehicles per year.
Morrow is one of the few companies on this list to be fully owned by European investors: shareholders include Siemens, ABB, the Danish pension fund PKA, the Norwegian state’s climate investment company Nysnø Climate Investments, Norwegian environmental company Noah AS and the Norwegian renewable energy company Å Energy. It has raised €191.8m over three years, according to Dealroom.
ICEYE — Finland
From Espoo, northern Finland, ICEYE has been developing data satellite services for security and industry purposes since 2015 and owns a constellation of satellites that generate high-resolution remote-sensing imagery. These capabilities are seen by EU officials as key to regional tech sovereignty to prevent European companies from relying on data gathered by satellites owned by companies or governments in other parts of the world.
Its customers include NASA, which is interested in data for its scientists, and the Australian government, which is using its near real-time flood and bushfire data to strengthen its disaster response. ICEYE also operates the so-called “People’s Satellite” (bought via a crowdfunding campaign), which has helped war-torn Ukraine launch attacks against Russian military equipment.
The company has raised over €320m in total funding according to Dealroom.
Orbex Space — UK
The Scottish startup aims to facilitate small satellite launches, especially of cube-shaped nanosatellites, on board its small commercial orbital rocket called Prime, from a spaceport under construction in northern Scotland, and a future site in the Portuguese Azores. Europe needs more launching capabilities to address current constraints on access to space and prevent becoming reliant on US, Chinese or Indian rockets.
Orbex expects to fly Prime for the first time this year, subject to a Civil Aviation Authority launch license. The departure of its founding CEO Chris Larmour in April, close to such an important milestone, raised eyebrows in the industry. He’s been replaced by Martin Coates, involved in Orbex since its launch.
Over the last eight years, however, Orbex has raised $127m, including grants from UK Space and the European Innovation Council, and a $45.8m Series C deal led by the Scottish National Investment Bank.
D-Orbit — Italy
D-Orbit launched in 2011 with the aim of creating a product to deorbit satellites at the end of their life, but has since come to specialise in so-called “space tugs”, which help satellites reach their desired destination after launch.
The company was the first in the space sector to win funding from the European Investment Bank (€15m in 2020) and, in June, it won four juicy contracts under Italy’s National Recovery and Resilience Plan, totalling about €60m. Backers include Seraphim Space and Silicon Valley-based Noosphere Ventures. Headquartered in Como, D-Orbit has expanded to Portugal, the UK and the US.
Isar Aerospace — Germany
A spinout from the Technical University of Munich and founded in 2018, Isar Aerospace develops and manufactures rocket-powered launch vehicles for small- to medium-sized satellites. It’s Europe’s best-funded spacetech venture, after raising $330m in total funding from investors including 7-Industries Holding, Bayern Kapital and Earlybird Venture Capital, among others.
Isar’s first and second missions, which it hopes to launch this year, will lift off from its own launchpad in Andøya, Norway, carrying European satellites. If early flights are a success, the company hopes to quickly get to 10 launches a year, eventually rising to 30-40 annually. Companies signed up to use Isar’s services include space logistics company D-Orbit (also on this list), French satellite startup Exotrail and US launch company Spaceflight.
Helsing — Germany
Munich-headquartered Helsing is a rare defence tech startup in a region where investors have traditionally shied away from backing tech with military uses.
Helsing’s software platform processes data from sensors and cameras on vehicles and systems to create real-time views of battlefields. Recent projects focused on providing capabilities for upcoming European fighter jets and providing technology to Ukraine since last year. Helsing has also deployed personnel to Ukraine.
AI and robotics
Wayve — UK
Created in a London garage in 2017, the self-driving car scaleup has grown steadily. In contrast with its much bigger competitors, which rely on cameras, laser-powered lidar sensors and radar, Wayve’s approach relies on vision technology underpinned by reinforcement learning — basically trying to teach a car how to drive itself like a person might learn.
Wayve landed $200m in a Series B round in January 2022 from investors including Microsoft, Virgin and Baillie Gifford. The company is already testing its self-driven vehicles in limited parts of London and other UK cities.
“I think the clock starts now — we’re seeing very small slivers of adoption, but they’re in affluent areas… Where you’ve got good infrastructure,” founder Alex Kendall told the CogX festival in London this month.
Aleph Alpha — Germany
The Heidelberg-based startup offers a platform to help businesses and governments develop generative AI tools and research, which includes large language models trained in five languages and the ability to modify systems to suit the needs of specialised environments.
Many in Europe hope Aleph Alpha could help the EU become less dependent on US GenAI companies such as Microsoft-backed OpenAI. It’s already built its own chatbot called Lumi.
Most recently, Aleph Alpha raised a €100m round in June from funders including chip-maker NVIDIA. Its customers include the German government, the City of Heidelberg and several German universities.
Poolside AI — France
Poolside AI is working on a ChatGPT-like tool that can write software code. This would enable people with no coding experience to become creators of useful software. Born in the US, the startup has opened a French subsidiary and announced it is relocating to Paris after raising a mammoth $126m seed round backed by French billionaire Xavier Niel and US VC Felicis in August 2023.
Mistral AI — France
Also based in France is Mistral AI, which aims to take on OpenAI with its own GenAI models, the first of which are expected in 2024. It raised €105m in a seed round in June 2023, just four weeks after a trio of former Meta and Google AI researchers launched the company and before putting any product on the market. Its backers include Headline, Index Ventures, Lightspeed Venture Partners and Bpifrance.
Graphcore — UK
The Bristol-based AI chip-designer unicorn has developed chips it calls Intelligence Processing Units (IPUs), which are supposed to be used for AI applications, and is one of a handful of companies trying to take on chip giant NVIDIA. The sharp increase in AI adoption and applications has fuelled a surge in demand for chips globally.
It is also developing an ultra-intelligent AI computer that would be much more affordable for companies and universities than existing supercomputers. Christened the Good Computer, the machine relies on a new type of silicon processor also developed by Graphcore.
Wandelbots — Germany
Wandelbots, a Dresden-based no-code robotics software developer, wants to make it easier for humans to work with robots, allowing us to shift more monotonous tasks to our mechanical brothers and sisters. The company claims to have developed the world’s easiest robot programming software, which is already being used by several robot manufacturers such as Denmark-based Universal Robots.
Wandelbots has raised $122m since its launch in 2017, including over $84m in its Series C round early last year, led by US VC firm Insight Partners and with backing from Microsoft. Part of the cash is funding its expansion in the US and Asia.
Exotec — France
The Lille-based warehouse robotics manufacturer became France’s first industrial unicorn last year, when it raised $335m in a Series D round led by Goldman Sachs.
Exotec builds scalable warehouse robotic solutions, with Skypods robots that roam freely, carry bins with objects and reach a height of 36ft. Skypicker robots can pick and drop goods from the bins. Investors say that industrial tech like Exotec’s is key for Europe as more companies look to secure manufacturing capabilities closer to headquarters.
Since its launch in 2015, Exotec has picked up $463m in total funding, and is growing fast in North America, with customers such as Decathlon using Exotec solutions in fulfilment centres.
Quantinuum — UK
Cambridge-based Quantinuum claims to have built the world’s highest-performing quantum computer, System Model H2. Founded in 2021 and led by Rajeeb Hazra, who spent 25 years at Intel, Quantinuum has raised over $268m in total.
Quantum capabilities are seen as key to cybersecurity and could revolutionise many other technologies and manufacturing. Automotive, chemicals, financial services and life sciences are the four industries likely to see the earliest economic impact from quantum computing — and they stand to potentially gain up to $1.3tn in value by 2035, according to McKinsey.
In May, Quantinuum announced a breakthrough that could support an alternative approach to the traditional way of building quantum computers.
The startup has recently teamed up with Airbus and BMW Group to use quantum computers to improve the chemical reactions of fuel cell catalysts.
IQM Quantum Computers — Finland
Another top player in Europe’s vibrant quantum ecosystem, IQM is a spinoff of Aalto University and VTT Technical Research Centre of Finland. Its most sophisticated computer is 54 qubits (the essential building block of quantum computers) but it also sells less powerful, five-qubit quantum-processing units to universities and research labs. Its processors will also be used in the first quantum accelerator in Spain.
In 2020, IQM unveiled a new way to measure the energy state of a superconducting qubit faster than conventional methods. IQM, which has raised €220.5m over its five-year existence, employs 280 people across its Espoo HQ and offices in Paris, Madrid and Munich.
SiPearl — France
The French chip manufacturer is building Rhea, an energy-efficient HPC processor for Europe’s future supercomputers, which it plans to commercialise in early 2024. The company says Rhea will ensure Europe’s tech sovereignty by solving major challenges in medical research, security, energy management and climate change mitigation, by processing huge volumes of key data in a fraction of a second with low energy needs.
The firm raised €90m from Cambridge semiconductor firm Arm in a Series A round in May, bringing its total financing to €110.5m, including EU and French grants worth a combined €30.5m.
SiPearl is boosting its staff from 130 to 1,000 by the end of 2025 and is eyeing Cambridge and Bristol as potential targets for future footprints, according to CEO and founder Philippe Notton.
PASQAL — France
Paris-based PASQAL, a startup founded on the Nobel Prize-winning research of cofounder Alain Aspect, has already sold two 100-qubit quantum computers for on-premises install in Germany and France, which will be commissioned by the end of this year, according to CCO Benno Broer. But the company has higher goals: it is aiming to commercialise a 1,000-qubit quantum computer by next year.
To fund that work, it raised €100m in a Series B round led by Temasek in January.
Simultaneously, it offers cloud access to its quantum computers located in Paris and is exploring potential quantum computing applications, working in partnership with several Fortune 500 companies, such as BASF, Siemens, Airbus and Crédit Agricole CIB.
Energy and climate tech
CORE POWER — UK
CORE POWER wants to decarbonise the maritime industry using nuclear power, specifically with a proprietary modular molten salt reactor. The reactor uses liquid fuel instead of solid fuel to propel ships, which it says will help prevent one of the most common types of accidents associated with traditional nuclear reactors.
The five-year-old startup has raised €167.9m in total funding according to Dealroom.
CORE POWER is also collaborating in a $600m programme with TerraPower of the US, backed by Bill Gates, Southern Company of the US and Orano of France, to build a test reactor by early 2026, with a view to start deploying the technology in the early 2030s.
Descartes Underwriting — France
Using AI and real-time monitoring from a range of sources including satellite imagery and sensors, Descartes offers parametric insurance products against climate change, aimed at protecting companies and governments against natural catastrophes, weather events and emerging risks. Its selling point: models based on historical data are no longer reliable, because climate change is causing events that are hard to predict. Descartes has raised a total of €127.9m since its launch in Paris in 2018.
Vay — Germany
Vay, founded in 2018 in Berlin, is trying to accelerate the arrival of self-driving cars to Europe’s streets by pursuing a teledriven approach. It works more or less as follows: app users order an electric car, which is brought to them by a teledriver, who controls the vehicle remotely from Vay’s teledrive centre. Then the customer drives the car manually, and when they’re done, the teledriver takes over the vehicle again, removing the need for parking.
Vay’s service was one of the attractions of this year’s Mobile World Congress, in Barcelona, where one of its teledrivers drove a car through the streets of Berlin.
The company raised a $95m Series B round in late 2021, and $109m in total.
Elliptic — UK
A London-based blockchain analysis provider, Elliptic offers anti-money-laundering software for financial services types, as well as forensics software that helps identify cryptocurrency transactions that appear to be linked to illegal activities, including terrorist financing and sanctions evasion.
Elliptic has raised $101m since its launch in 2013, according to Dealroom. Its last funding round was a Series C yielding $60m, led by Evolution Equity Partners and including SoftBank Vision Fund 2, AlbionVC, J.P. Morgan and others.
Asia has become the fastest-growing market for Elliptic, which has opened offices in Singapore and Tokyo, in addition to its London HQ and New York.
NEAR Protocol — Portugal
The Portugal-HQ’d startup is investing $100m in gaming and metaverse ventures, using sharding technology, a blockchain scaling technique that enables more transactions per second with lower transaction costs. It offers native NEAR tokens, which can be used to pay for transaction fees and storage on the NEAR crypto platform.
The startup, which is registered in San Francisco but has most of its team working from Portugal, aims to compete with Ethereum. It has raised $524m since 2017, with backers including Andreessen Horowitz, Pantera Capital and Dragonfly Capital Partners.