September 20, 2022

European deeptech startups are on track to raise more in 2022 than 2021

The European deeptech sector is growing despite the economic downturn

Northvolt's facilities

While other tech sectors, including fintech, have seen investment slow down after a record high in 2021, deeptech is booming. European deeptech startups have raised €12.3bn in 2022 to date, compared to €12.2bn raised in the same period of 2021, according to data company Dealroom.

A big chunk of the funds flowing into European deeptech last year came from battery startup Northvolt’s €2.8bn fundraise in June 2021 — the largest round by far in the deeptech sector in Europe that year. In July this year the company raised an additional $1.1bn — which is, so far, 2022’s largest round too. 

The development of deeptech products "is not as dependent on the immediate macroeconomic conditions as, say, consumer-focused or app-based startups,” says Manjari Chandran-Ramesh, partner at VC firm Amadeus Capital. 


“Furthermore, the timeline for these innovations is over a five to seven-year horizon and not in the next couple of years. This is another reason why the current slowdown doesn’t affect the deeptech [sector] as much.”

The top raises in 2022

Among the top 10 deeptech fundraises in 2022 so far, three went to companies with an environmental focus. 

Northvolt, which is based in Sweden, is making batteries for electric vehicles with an 80% lower carbon footprint than most manufactured batteries. Switzerland-based Climeworks, which raised CHF600m (€615m) in April, is developing carbon capture technologies. H2 Green Steel, another startup based in Sweden, which raised €190m in August, is a fossil-free steel producer.

Most of the other companies in the top 10 are working in artificial intelligence and machine learning, with applications ranging from retail optimisation (Relex Solutions) to advertising (Seedtag) and self-driving cars (Wayve).

Which subsectors received the most money? 

Artificial intelligence and machine learning keep receiving most of the attention from investors within the deeptech sector, followed by hardware and energy. 

While much lower in comparison, quantum computing is seeing a record amount of investment this year. European quantum startups received more than triple the investment in 2022 compared to the same period in 2021. It’s likely this trend will continue as several new funds — such as Quantonation and 2xN — have launched in the past year that have a focus on quantum technology.

UK startups lead the pack 

Most investment in European deeptech has gone to startups in the UK — a trend seen across tech sectors. 

Sweden claims second place in terms of investment raised, thanks to Northvolt and H2 Green Steel’s mega raises.

The most active investors

Given the focus on research that define deeptech startups, the European deeptech sector attracts a lot of investment from public funds. The two most active investors in European deeptech — the European Innovation Council (EIC) Fund and Bpifrance — are backed by the EU and the French government, respectively. The fourth most active deeptech investor in Europe, High-Tech Gründerfonds, is a private-public partnership backed by the German government.