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66 billion euros of investments in Europe, AI and defense take the largest share
2026-02-10 16:32:03 / BOTA
Investors are pouring billions of euros into European Artificial Intelligence (AI) and defense technology startups, sectors considered essential to the continent's economic competitiveness and strategic security.
According to PitchBook data, total venture capital investment in Europe grew by 5% in 2025, reaching €66 billion – the highest level since the post-pandemic period. The growth was driven mainly by large deals in the fields of AI and defense.
In the Artificial Intelligence sector, several companies have achieved high valuations after recent funding rounds. Swedish legal AI startup Legora is in talks for funding at a valuation of around $4 billion. London-based company Synthesia has secured $200 million at a $4 billion valuation, while ElevenLabs reached a valuation of $11 billion after a $500 million round.
Meanwhile, in the defense sector, investments have increased significantly. German company Isar Aerospace, which specializes in developing orbital rockets, is discussing raising new funds, while drone manufacturers Helsing and Quantum-Systems secured nearly 1 billion euros in financing last year.
According to the NATO Innovation Fund and research group Dealroom, investment in European defense and technology startups is expected to grow by 55% in 2025, reaching a record $8.7 billion. Key areas include quantum computing, space and “deep tech” technologies.
However, the rapid rise in valuations has also raised concerns about potential overvaluation in the market. Google DeepMind head Demis Hassabis has warned that the enthusiasm in some parts of the AI industry could resemble a “bubble.”
Analysts say the surge in investment is also linked to geopolitical developments, including the war in Ukraine and the push by European governments to strengthen technological and security independence. The issue of European rearmament is also expected to be at the center of discussions at the Munich Security Conference.
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