European deeptech startups on observe to lift extra in 2022 than 2021


Whereas different tech sectors, together with fintech, have seen funding decelerate after a file excessive in 2021, deeptech is booming. European deeptech startups have raised €12.3bn in 2022 to this point, in comparison with €12.2bn raised in the identical interval of 2021, in keeping with knowledge firm Dealroom. 

A giant chunk of the funds flowing into European deeptech final 12 months got here from battery startup Northvolt’s €2.8bn fundraise in June 2021 — the biggest spherical by far within the deeptech sector in Europe that 12 months. In July this 12 months the corporate raised an extra €1.1bn — which is, to date,  2022’s largest spherical too. 

The event of deeptech merchandise “is just not as depending on the instant macroeconomic circumstances as, say, consumer-focused or app-based startups,” says Manjari Chandran-Ramesh, associate at VC agency Amadeus Capital. 

“Moreover, the timeline for these improvements is over a 5 to 7 12 months horizon and never within the subsequent couple of years. That is another excuse why the present slowdown doesn’t have an effect on the deeptech [sector] as a lot.”

The highest raises in 2022

Among the many high 10 deeptech fundraises in 2022 to date, three went to corporations with an environmental focus. 

Northvolt, which relies in Sweden, is making batteries for electrical automobiles with an 80% decrease carbon footprint than batteries made utilizing coal vitality. Switzerland-based Climeworks, which raised CHF 600m (€615m) in April, is growing carbon seize applied sciences. H2 Inexperienced Metal, one other startup based mostly in Sweden, which raised €190m in August, is a fossil-free metal producer.

A lot of the different corporations within the high 10 are working in synthetic intelligence and machine studying, with purposes starting from retail optimisation (Relex Options) to promoting (Seedtag) and self-driving automobiles (Wayve).

Which subsectors acquired essentially the most cash? 

Synthetic intelligence and machine studying preserve receiving many of the consideration from traders throughout the deeptech sector, adopted by {hardware} and vitality. 

Whereas a lot decrease as compared, quantum computing is seeing a file quantity of funding this 12 months. European quantum startups acquired greater than triple the funding in 2022 in comparison with the identical interval in 2021. It’s probably this pattern will proceed as a number of new funds — similar to Quantonation and 2xN — have launched up to now 12 months which have a deal with quantum know-how.

UK startups lead the pack 

Most funding in European deeptech has gone to startups within the UK — a pattern seen throughout tech sectors. 

Sweden claims second place by way of funding raised, due to Northvolt and H2 Inexperienced Metal’s mega raises.

Probably the most energetic traders

Given the deal with analysis that outline deeptech startups, the European deeptech sector attracts loads of funding from public funds. The 2 most energetic traders in European deeptech — the European Innovation Council (EIC) Fund and Bpifrance — are backed by the EU and the French authorities, respectively. The fourth most energetic deeptech investor in Europe, Excessive-Tech Gründerfonds, is a private-public partnership backed by the German authorities.

 



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