$8 Billion Funding Surge: How European AI Startups Are Challenging US & China in 2024

In just a few days, France will host the Artificial Intelligence Action Summit, drawing world leaders and top tech executives to Paris. The summit is expected to feature major announcements on AI investments and global agreements, with a strong focus on AI safety and environmental impact.

The French AI Report: A Deep Dive into Europe’s AI Growth

Ahead of the summit, early-stage venture capital firm Galion.exe, growth investment firm Revaia, and advisory firm Chausson Partners collaborated to publish the French AI Report, highlighting key trends in Europe’s AI ecosystem.

While much of the world’s attention remains on the U.S. and China, where OpenAI is raising tens of billions of dollars and DeepSeek is making headlines, Europe has also experienced an AI startup boom.

In 2024, AI startups accounted for approximately 20% of all VC funding in Europe, amounting to around $8 billion in investments.
70% of AI funding in 2024 was directed at early-stage companies, from Seed to Series B rounds.
The U.K. leads in AI investment, followed by France and Germany, with Nordic countries performing exceptionally well given their smaller populations.

France’s Expanding AI Ecosystem

France has positioned itself as a significant AI hub. According to Clara Chappaz, France’s Minister Delegate for AI and Digital Technologies, the country is home to:

More than 750 AI startups, creating 35,000 jobs across various industries.
2,000 AI-focused scientists and 600 doctorate students researching artificial intelligence.
A strong talent pipeline, with many French engineers and researchers playing key roles in top AI firms in the U.S.

France’s Rising AI Stars: Beyond Foundation Models

The French AI Report examined 400 leading AI startups to identify key players shaping the industry. While Mistral AI and Poolside are already well-known for their work on foundation models, most AI startups in France are focusing on infrastructure and industry-specific applications.

AI Infrastructure Startups

Several French companies are making strides in optimizing AI infrastructure, including:

Linkup & Kestra – Streamlining data workflows and pipelines for AI applications.
ZML – Enhancing AI inference performance to make models run faster and more efficiently.
Dust – Developing AI agents that process large datasets to boost productivity.

AI Applications: Health and Climate as Key Sectors

Rather than competing in the race to develop general AI, many French startups are focusing on specific industry applications—with health tech and climate tech emerging as major areas of innovation.

The Globalization of AI Investment

As French AI startups scale beyond early funding rounds, they are increasingly attracting international investors:

By Series C and later stages, U.S. venture capital firms account for nearly 50% of AI investment in France.
This trend suggests that European AI startups are gaining global credibility, drawing in capital from major international players.