European deep tech deals raised $17.7 billion last year — report

The report sets out ideas on how to maximise European deep tech success.
European deep tech deals raised $17.7 billion last year — report

Europe's deep tech startups closed off 2022 having brought in around $17.7 billion, down 22% on the year but still 60% above 2020 trends, according to a new data report.

The report, published by Dealroom, Lakestar and Walden Catalyst Ventures, puts forward an argument that, in the second half of last year, European deep tech was the second best performer on a sector-by-sector basis; energy was first.

The data is borne out by investor sentiment. An LP survey included in the study cites deep tech as investor's number two pick for innovation, trailing only societal impact models, or "Planet Positive" as the report says.

In the third and fourth quarter deep tech valuations dipped 9% on 2021  equivalents, but surpassed funding totals VC-wide that were down 45%.

The report highlights four key sectors on deep tech's emerging frontier: novel AI, future of computing, novel energy and space tech. In 2022, a record $4.4 billion was invested across these four sectors, more than doubling their haul from two years prior. Future of computing tech in 2023 is off to a raring start already. Before January's even done Tech.eu has tracked four big quantum disclosures (Pasqal, Chalmers University of Technology, Welinq and Oxford Ionics.)

Christina Franzeskides, deep tech investor at Lakestar, argued European deep tech talent and research could be further leveraged by maximising IP value from Europe's leading universities, which more often than not sponsor deep tech by forming spinout companies.

Franzeskides, whose specialties include AI, robotics and quantum, added: "More must be done to avoid unconscious bias. Last year only 3% of VC funding in Deep Tech was invested in startups that were female-only founded. However, diversity of thought, opinion and creativity is essential for our Deep Tech ecosystem to thrive. To that end, we must strive towards inclusivity, across all backgrounds and genders, for the space to reach its full potential.”

Walden Catalyst Ventures partner Nicolas Autret added: "We are looking for the next Marie Curie or Max Planck, scientists and entrepreneurs taking disruptive technologies out of the lab and turning them into commercial products.

"Distributed at global scale, these technologies eventually make their way into everyone's life, and have the potential to solve some of the many challenges humanity is facing.”

Lead image: Louis Reed

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