Paris-based Mistral AI’s huge €105m funding round last month, just four weeks after launching, is a sign that open source startups are worth keeping an eye on. And, while the US still largely dominates when it comes to companies commercialising free code, Europe boasts a wealth of engineering talent that is fuelling a rise in the number of open source startups on the continent.
From London-based StabilityAI, which offers an open source sketch-to-image generative AI tool and has raised a total $101m, to Helsinki’s Aiven, an open source cloud data platform that raised a $210 Series D last year — open source businesses are becoming increasingly visible in Europe.
Yet the business value of open source, which is by definition about giving software out for free, is difficult for some investors to grasp. Sifted asked several VCs for the most promising startups in the field, which don’t feature in their portfolios.
Ekaterina Almasque, general partner at OpenOcean
OpenOcean is a pan-European, early-stage VC firm specialising in investment in tech startups building the data economy
Deepset.ai (Germany)
Deepset.ai offers open source tools for programmers to create natural language processing systems, from prototyping to deployment and monitoring. These systems enable enterprise customers to make sense of data by asking plain-language queries about complex datasets. The company also addresses the German language in its offering — a major differentiator in a market still dominated by English.
Coqui.ai (Germany)
Coqui.ai’s open source technology leverages generative AI to create voice content for a variety of use cases, ranging from video game development to dubbing and post-production. As voice technology advances, Coqui's open source approach allows developers globally to contribute to the development of voice interfaces across various languages and dialects.
Mistral AI (France)
With significant talent at this French AI startup from the likes of Google’s DeepMind and Meta, Mistral holds great promise in delivering on its mission to "make AI useful” and create an AI leader in Europe to rival America’s OpenAI. The founders are pushing for a sea change in the AI market away from proprietary models towards open source. By spearheading the development of foundational models with European values, the data that will be created from Mistral’s work will be priceless for European technology — spurring new innovation across the continent.
Jina AI (Germany)
Jina AI is a unique commercial open source software company that specialises in a powerful multimodal AI platform. With an impressive $37.5m raised in just 20 months, its platform enables enterprises to conduct comprehensive searches across diverse data types throughout the world. It’s set to revolutionise the search market, becoming a coveted AI-driven search application.
Konstantin Vinogradov, general partner at Runa Capital
Based in Luxembourg, Runa Capital has invested in open source companies since 2011 and produces the ROSS Index, a quarterly public report on the fastest-growing open source startups
Medusa (Denmark)
The open source wave covers purely developer-focused products all the way to broader business software. Copenhagen-based startup Medusa is a great example of this — it targets the commerce tech stack and offers plenty of modules for building customised digital commerce experiences.
SurrealDB (UK)
The popularity of open source tools in databases surpassed that of closed source in 2021 and open source became the default go-to strategy for this market. Unsurprisingly, open source is used by London-based SurrealDB to develop its multi-model database. Its product carries features like its own SQL-like query language, API layer and many others, which are missing in legacy databases.
Quickwit (France)
Open source search platforms were pioneered by search and analytics engine Elasticsearch, but unprecedented data growth has driven new developments in this area. Paris-based Quickwit innovates by building a high-performant search for modern cloud-native environments.
Harry Haeck, principal at Smartfin
Smartfin is a European venture and growth capital investor that invests throughout Europe and the UK in mid to later-stage technology companies, with a focus on B2B technologies
Passbolt (Luxembourg)
Developing an open-source password management software, Passbolt helps to implement information security practices. This includes centralising passwords, preventing teams from reusing the same password on multiple systems, increasing password strength and enabling team members to store and share credentials securely.
Lago (France)
Lago describes its open source product as a “Stripe billing alternative”. The company provides a subscription and usage-based billing API to help teams implement complex billing structures.
Theta (Italy)
Theta is a no-code app builder designed to facilitate quick UI design by enabling the creation of remote interfaces directly within the app. Developers can incorporate the software into their existing workflows, which ensures seamless integration while maintaining code quality.
Qdrant (Germany)
Qdrant offers a high-performance vector database for AI applications. This means that it stores data as vectors — multi-dimensional mathematical representations of features or attributes which can reflect a highly complex dataset. This is available as a managed database as a service (DBaaS) in the cloud, enabling users to adopt the product with reduced resources and costs.
