Growth in Europe’s ‘deep tech’ start-ups provides some welcome positivity for the future of the region’s digital hubs. European industrial tech applications and technical platforms are attracting record levels of investment; more than $2.3 billion has been invested in the deep tech sector since the start of 2015, according to a study by Atomico. Industry executives have attributed this to the emergence of expertise in robotics, chips and artificial intelligence (AI). Deep tech start-ups are expected to raise almost $1 billion, representing four times the capital invested in 2011. Companies such as Sigfox, UpCloud and Euklid have all been involved in fund raisings during the past few months.
Mattias Ljungman, a partner at Atomico, expressed the view that innovation and scientific invention are fuelling the strategies of numerous companies. He told the Financial Times: “Take artificial intelligence — European companies are using it creatively for everything from fashion design and music creation to healthcare.” This was echoed by Kathryn Mayne, managing director of Horsley Bridge, who stated: “What’s different since 2010 is that Europe has been able to generate some of these big outcomes. It feels like we’re entering a time when the power of things like artificial intelligence will really drive fundamental change faster than has been the case in the past.”
Indeed, AI has proven to be a powerful driver of growth, particularly in Europe and the UK due to the presence of DeepMind, a British AI company. Additionally, Amazon, Twitter, Apple and Microsoft have all acquired UK AI businesses, as there is growing trend for US tech giants utilising European expertise. For example, Amazon’s voice-controlled Bluetooth speaker, Alexa, was partly built by its team of engineers in Cambridge, acquired through its purchase of Evi Technologies. Furthermore, Microsoft recently announced that it would invest $14 million in an internet of things “incubator” based in Finland.