Early-stage AI funding in Europe is broadly comparable to the United States. Median round sizes at angel, pre-seed, and seed stages are similar across both regions. The similarities however stop here. The gap between EU and US funding becomes pronounced from series D onwards and when outliers are taken into considerations.
The problem is structural, not cultural. European VCs demonstrate equal willingness to invest at early stages. The constraint difficulty lies in the availability of large capital pools for later-stage rounds, fewer large funds, fragmented markets across multiple countries, and lower appetite for high-magnitude growth bets.
Within Europe, average seed round sizes vary considerably by country. France and Norway sit at the top of the range, whilst Hungary, Poland, and Belgium figures are approximately four times smaller than their highest-ranked European counterparts. Still, it is important to consider a country like France has its mean inflated by some outliers, suggesting the presence of some large deals and not an overarching growing ecosystem.
It is also important to consider how the lack of capital shapes the structure of EU startups. The companies under study show a lower closure rate (8.1%) than US counterparts (14.0%), in line with the lack of capital availability pushing for early stage stable models. A setting suitable for more stable companies but not offering the opportunity for large bets.
For a deeper look at the data underlying this analysis, including deal-level breakdowns, sector segmentation, and investor activity across states and regional AI ecosystems, write to us at team@aiworld.eu or through the form.
Sources: Crunchbase