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European AI Startups Raised $8B Last Year

European AI Startups Raised $8B Last Year

Christopher Webster
February 05, 2025

Startups:

Deel unloads $300M:

Deel is a fintech-turned-HR startup that seems to be preparing for an IPO. They have reportedly grew their annual revenue run rate to $800 million, which is 70% growth. The startup, which helps businesses globally hire, manage and pay employees remotely, also said it has sold $300 million in secondary shares to General Catalyst and an unnamed “sovereign investor”. This gives their early investors a payout. The reported unnamed investor is Mubadala Investment Company, the sovereign wealth fund of Abu Dhabi. This is a clear sign that the company is looking to either IPO this year or the next. In May 2022, Deel was valued at $12 billion. After its secondary sale, its valuation was $12.6 billion. The company recently filed a motion asking a Florida court to dismiss a lawsuit that charged that Deel enabled money laundering. When will we see Deel IPO?

$8B went to European AI startups last year:

In Europe AI companies accounted for around 20% of all VC funding in 2024. That would bring the total dollar amount to around $8 billion. The number is expected to continue to grow as we are still in the very early stages of AI. The big AI investment hubs are located in the typical VC funding countries like the U.K., France, and Germany. The only question is what should we expect from European startups? Although $8 billion is a lot it is nowhere near what just one U.S. company, OpenAI is raising alone. The counter argument is that China’s DeepSeek didn’t cost as much as U.S. models, although there is heavy debate on how much DeepSeek really spent. Will these European countries be left behind in the AI race?

Venture:

Marine turned investor:

Powerhouse venture firm Andreessen Horowitz has hired Daniel Penny as an investor. This has been confirmed via a16z website. Penny is the former Marine who was tried last year and found not guilty of criminally negligent homicide in the death of a homeless man on a New York City subway. After the man acted erratically, Penny held him in a chokehold and the man was later pronounced dead. The case polarized the nation. Penny does not have a background in investing, but a16z plans to train him, according to an internal statement obtained by The Free Press, which broke the news. Penny will work in the American Dynamism practice, which invests in government and defense tech. How good of an investor will Penny be?

Big Tech:

Google Weaponizes:

Google removed a pledge to not build AI for weapons or surveillance from its website this week. This is a big change for a company like Google. The company appears to have updated its public AI principles page, erasing a section titled “applications we will not pursue”. The company now believes that making “responsible AI” includes working together to create AI that protects people. How will this work out for Google? Google has had employees protest for their contracts to provide the U.S. and Israeli militaries with cloud services. Can Google really guarantee that their AI will not be used to harm humans? Will we see another protest from their employees?