European startups raised approximately €12.4 billion in Q2 2025 across roughly 2,900 deals, marking a meaningful increase from €10.8 billion in Q1 and representing the strongest quarterly performance since late 2022. This growth reflects a shift in investor psychology from defensive caution to calibrated conviction. The median deal size increased, particularly at Series B and beyond, with late-stage rounds returning forcefully after being absent during the 2023-2024 correction. Several rounds exceeding €100 million closed in AI infrastructure, defence tech, and climate sectors. Early-stage funding remained stable throughout the downturn, while the significant story involves reactivation of growth-stage capital as investors found normalized valuation levels acceptable.
"European startups raised approximately €12.4 billion in the second quarter of 2025, marking a meaningful uptick from the €10.8 billion logged in Q1 and representing the strongest quarterly performance since late 2022. The numbers aren't a return to the frothy peaks of 2021. They're something more interesting: a signal that investor psychology has shifted from defensive caution to calibrated conviction."
"The €12.4 billion figure spans roughly 2,900 deals across the continent, with the median deal size ticking upward - particularly at Series B and beyond. Late-stage rounds, which had been conspicuously absent during the 2023-2024 correction, are returning with force. Several rounds north of €100 million closed during the quarter, concentrated in AI infrastructure, defence tech, and climate-adjacent sectors."
"Early-stage funding (pre-seed through Series A) remained broadly stable - it never really collapsed, even during the downturn. The real story is the reactivation of growth-stage capital. Investors who had been sitting on dry powder, waiting for valuations to normalise, appear to have found price levels they can work with."
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