In Q2, Europe posted its strongest quarter in four years for venture funding, Crunchbase data shows. All told, Europe-based startups raised $24 billion in the just-ended quarter, up around a third quarter over quarter and two-thirds higher than the $14.4 billion raised in Q2 2025.
Within the region, U.K. startups gained significant share in Q2, raising more than $10 billion. That marked the third-largest funding quarter for the U.K. on record, and came in at less than $500 million below its peak quarter in 2021.
European startup M&A activity also picked up in Q1 and continued that momentum in Q2, even as public-market exits stayed subdued.
Table of contents
- Large rounds drive gains
- H1 2026 up 50%
- UK momentum builds
- By stage
- Looking ahead
- Methodology
- Glossary of funding terms
Large rounds drive gains
Four companies raised venture fundings of a billion dollars or more last quarter, accounting for 25% of all startup investment in the region in Q2, Crunchbase data shows.
Those billion-dollar-plus rounds were raised by an AI-centric group: Alphabet-owned AI drug developer Isomorphic Labs, which was spun out of DeepMind; green steel production manufacturer Stegra; Neura Robotics, which is developing robots for home and industrial applications; and Ineffable Intelligence, an AI lab founded by former DeepMind researchers.
However, most of the growth in funding year over year and quarter over quarter was driven by rounds of $100 million and over. The majority of funding — 65% — went to a group of 42 companies that raised rounds of $100 million-plus. Sectors that stood out for these companies include biotech, quantum, financial services, AI labs, aerospace, semiconductor, robotics and energy.
H1 2026 up 50%
Funding to Europe-based startups in H1 was up 50% year over year to total $42 billion, Crunchbase data shows. Still, the region’s startup investment for the first half of the year remained well below the 2021 H1 peak, when VC funding in Europe totaled $60 billion.
It’s also drastically lower than the $392 billion raised in North America’s record-setting H1, with that region’s funding up 158% year over year.
Europe’s funding deal count subsided last quarter, but mostly at the seed stage. Late-stage rounds were up a bit, while early-stage deals dipped slightly year over year. (It’s worth noting, seed stage rounds are often added to the Crunchbase data set after the close of the quarter, so those numbers will increase over time.)
UK momentum builds
The United Kingdom widened its venture-funding lead last quarter, as startups based in the country raised $10.4 billion — not far from the peak in 2021 at $10.8 billion.
The region’s No. 2 startup market, Germany, trailed with $3.2 billion raised by its startups in Q2, and France followed in third place with $2.4 billion. Sweden was Europe’s fourth-largest startup market last quarter, with its companies raising $2 billion.
Crunchbase data shows funding to Europe’s AI-focused companies reached more than $10 billion in Q2 — the largest quarterly amount so far — but slightly below the Q1 percentage, when those companies raised more than half of the region’s startup investment.
By stage
Europe’s late-stage funding totaled $12.1 billion in Q2, up 90% year over year. Large Series C and D rounds were raised by Germany-based robotics developer Neura Robotics; Netherlands-based Nearfield Instruments, which makes inspection tools for semiconductor manufacturing; U.K.-based quantum computing startup Oxford Quantum Circuits; and Germany-based satellite launcher Isar Aerospace.
Early-stage funding reached $8.6 billion across 250-plus Europe-based startups last quarter, Crunchbase data shows. Large Series A and Series B rounds were raised by London-based Isomorphic Labs, London-based AI self-learning lab Recursive, Germany-based fusion energy company Focused Energy, London-based semiconductor developer Fractile, and London-based quantum processor provider QuantWare.
European seed funding totaled $3.2 billion last quarter, with a billion dollars of that raised by just one company: Ineffable Intelligence.
Other large seed rounds were raised by Inherent, a London-based AI lab for science; Italy-based autonomous driving technology producer Niulinx; and Stockholm-based defense tech company Swebal.
M&A increase
While IPO activity for European startups was muted, M&A showed strong momentum following increased activity in Q1. A total of 154 Europe-based, venture-backed companies were acquired for a cumulative $11.5 billion or more in Q2, Crunchbase data shows. That includes three companies acquired for more than $1 billion each in biotech, industrial AI and micromobility.
Looking ahead
European startup investment has now steadily increased since the fourth quarter of 2024, with increased momentum in the just-ended quarter, driven by larger rounds of $100 million and over. The region’s startup ecosystem shows particular strength in deep tech and financial services as well as the formation of new AI labs, and M&A activity has fueled liquidity for the next batch of startups.
Now the question remains: Will it be enough to keep Europe competitive with the frontrunners, the U.S. and China?
Related Crunchbase queries:
Related reading:
- Crunchbase Data: Global Startup Investment Hit Record $510B In H1 2026 As AI Boom Accelerates Funding And Exits
- North American Startup Funding Shattered Records In First Half Of 2026, Driven By AI
Methodology
The data contained in this report comes directly from Crunchbase, and is based on reported data. Data is as of July 6, 2026.
Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.
Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.
Glossary of funding terms
Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.
Early-stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.
Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.
Technology growth is a private-equity round raised by a company that has previously raised a “venture” round. (So basically, any round from the previously defined stages.)
