Europe’s startup engine is quietly back in top gear. More than ten companies crossed the $1 billion valuation threshold this year, defying the late‑stage funding chill and underscoring how deep tech, AI, defense and healthcare are reshaping the region’s next generation of category leaders.
While mega-rounds are rarer than the boom years, the new unicorns span a striking range of sectors and check sizes—from nine‑figure Series As to convertible growth rounds—suggesting investors are prioritizing fundamental technology, mission‑critical software and capital‑efficient business models. PitchBook, Dealroom and Atomico’s ongoing analyses all point to the same trend: fewer frothy deals, but a healthier mix of durable, R&D‑rich companies reaching scale.
Where the new unicorns are coming from
AI remains the headline act. Enterprise AI platforms like Parloa secured unicorn status with a $120 million round at a $1 billion valuation, while workflow automation player Tines crossed $1.1 billion on a $125 million raise as its software executes over a billion automated actions for customers each week. Framer, the design‑forward, no‑code website builder, hit roughly $2 billion after a $100 million infusion to double down on enterprise and AI features. Lovable, the fast‑rising “AI coding” entrant, reached about $1.8 billion following a $200 million Series A led by Accel—an unusually rapid path to unicorn scale that reflects AI’s current pull with both developers and executives.
Defense and dual‑use aerospace are equally prominent. Germany’s Quantum Systems became a unicorn on a €160 million Series C backed by Balderton and strategic investors like Hensoldt and Airbus Defense and Space, highlighting how autonomy and AI‑native drones are now considered critical infrastructure. Isar Aerospace vaulted past the mark via a €150 million convertible deal with Eldridge, adding to Europe’s growing private launch capabilities. Portugal’s Tekever confirmed a valuation above £1 billion as it advances long‑range maritime surveillance drones with backing from the NATO Innovation Fund and long‑only investors.
Health and biotech produced some of the year’s biggest checks. Isomorphic Labs, the AI drug‑discovery spinout from DeepMind, drew $600 million from Thrive Capital alongside GV and Alphabet. Verdiva Bio, working on an oral GLP‑1 therapy in the mold of blockbuster metabolic drugs, reached unicorn status straight out of the gate with a $410 million Series A. Preventative health startup Neko Health—co‑founded by Spotify’s Daniel Ek—raised $260 million at around $1.8 billion to scale full‑body scanning and early detection.
Deep tech infrastructure is punching above its weight. Finland’s IQM joined the club after securing more than $300 million for quantum hardware and a cloud platform, bringing total funding to roughly $600 million. France’s Zama crossed the threshold with a $57 million Series B to productize fully homomorphic encryption, a technique that lets companies compute on encrypted data—an increasingly attractive capability as AI and privacy requirements converge.
The breadth extends beyond hard tech. Mubi, the curated streaming platform that also produces and distributes films, became a unicorn on a $100 million round led by Sequoia Capital. In energy, Fuse Energy, founded by former Revolut executives, was reported by The Times to have raised at a valuation north of $1 billion as it builds a modern renewable utility.
Smaller rounds, stronger signals
Compared with the cycle’s peak, many of these rounds are smaller in absolute dollars, but they’re sending more credible signals. CB Insights and Dealroom have noted the rise of unicorns achieved on disciplined burn and real revenue traction rather than momentum alone. Several of this year’s entrants reached scale on efficient go‑to‑market models—security and operations automation at Tines, AI‑assisted service at Parloa, and design‑led SaaS at Framer—where gross margins and net retention are easier to scrutinize.
Another theme is strategic capital. Deals in space and defense often include corporate and government‑adjacent backers—Airbus entities at Quantum Systems, NATO Innovation Fund at Tekever—reflecting an ecosystem that now values capability and procurement readiness as much as growth rate. Convertible structures, like Isar Aerospace’s, also show late-stage investors looking for downside protection while keeping exposure to potential breakout outcomes.
A genuinely pan‑European pattern
The new unicorns map a broad geographic spread: the Nordics (IQM in Finland; Neko Health and Lovable in Sweden), DACH (Isar Aerospace, Quantum Systems, Parloa), the U.K. and Ireland (Isomorphic Labs, Tines, Fuse Energy, Mubi), France (Zama), and Portugal (Tekever). University spinouts and research clusters are pivotal—Isar emerged from the Technical University of Munich, which now counts dozens of alumni companies at unicorn scale—supporting the view, highlighted in the State of European Tech report, that Europe’s edge sits at the intersection of world‑class research and applied engineering.
Cross‑border capital remains a constant. U.S. growth firms like Sequoia, Thrive, General Catalyst, Altimeter, and Accel appear alongside European stalwarts such as Balderton, Atomico and HV Capital. That mix helps European startups scale globally earlier, especially in regulated industries where distribution and partnerships can make or break the P&L.
What to watch next
Two catalysts could sustain this pace. First, AI is moving from pilots to production. As enterprises harden security, privacy and governance, platforms that combine automation with provable compliance—think Tines, Parloa, Zama—are well positioned. Second, policy tailwinds in defense, energy and health create durable demand curves that favor European strengths in dual‑use hardware, clean power and medical innovation.
Exits remain the open question. IPO windows are narrow, and many of this year’s unicorns will rely on secondary sales, strategic partnerships or revenue‑funded growth. The European Investment Bank and several national initiatives have called for deeper late‑stage and crossover capital pools; if that materializes, expect more home‑grown companies to scale independently rather than sell early.
Mind the caveats
Not all unicorn badges look the same. Some valuations are private, others inferred, and a few are based on convertibles or mixed equity rounds. As analysts at PitchBook often caution, down‑round risk hasn’t disappeared. Still, the cross‑section of this year’s cohort—AI software, quantum, drones, biotech, encrypted computing, renewables and media—suggests substance over sizzle.
The headline is simple: Europe is producing billion‑dollar companies again, with a tilt toward hard problems and global markets. If that continues, the question won’t be whether the region can mint unicorns, but how many will grow into resilient public companies anchoring the next decade of European tech.