21 European startups to watch in the AI and deep tech race

Investors have identified 21 European startups to watch, ranging from pre-launch to unicorn status, based on recommendations from venture funds. While these selections may not reflect where the region’s hottest hubs are, they highlight the breadth of innovation currently emerging from the continent. The list suggests that Europe should be known for BottleCap AI, a Prague-based AI startup, rather than bottle cap memes.

The list underscores a shift in European tech, where defense tech has moved from pariah to trending, and deep tech talent could help Europe play its own cards in the AI race. This trend is supported by capital, including funding rounds for companies like Proxima Fusion and PLD Space. Proxima Fusion secured $460 million from the state of Bavaria to support its plans to build a fusion power plant in Europe, starting with a demonstration stellarator near Munich. Meanwhile, Spanish rocket launch provider PLD Space secured a $209 million Series C round, bringing its total funding to more than $350 million.

Across sectors, startups are tackling specific market needs:

AI & Deep Tech

• Fundamental: An AI startup valued at $1.4 billion following a $255 million Series A.
• Gradium: An AI voice model developer that raised a $70 million seed round.
• Inbolt: A physical AI developer active in more than 70 factories.
• Macrodata Labs: An AI training data infrastructure provider. As the startup claims, “Every strong model starts with great data.”
• Multiverse Computing: A Spanish model compression provider that has raised $250 million.
• HappyRobot: An AI agent developer backed by a16z (Andreessen Horowitz, a major US VC firm) and Y Combinator (a major US startup accelerator).
• Botify: An SEO and generative engine optimization provider and Disrupt NY (a major tech conference) alum.
• Cala, Roofline, and BottleCap AI: Developing knowledge graphs, model deployment software, and foundational LLMs.

Fintech & Legal Tech

• Pennylane & Apron: Fintechs targeting SMBs, which can be a lucrative segment for fintech companies.
• Legora: A Swedish-born legal tech startup now headquartered in New York.

Energy, Space & Defense

• Alta Ares, Cailabs, & Optics11: Developing counter-drone systems, photonics, and fiber-optic sensing.
• Space Forge & Theker: Focused on in-space manufacturing and robots as a service.
• Flower: A Swedish renewable energy management provider that raised over $60 million in bonds.

Why it matters

The list highlights European startups that insiders are tracking closely, reflecting how deep tech talent could help Europe play its own cards in the AI race.