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Home COUNTRY DACH

Europe’s AI push: €150 billion pledge to supercharge European AI startups

EU Startupsby EU Startups
February 10, 2025
Reading Time: 5 mins read
in DACH, FRANCE, GREEN, VENTURE CAPITAL
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As the 2025 two-day AI Action Summit unfolds in Paris, a major push to position Europe as a global leader in AI is taking shape. The EU AI Champions Initiative, spearheaded by the global investment and transformation company General Catalyst, has issued a call to action urging simplified AI regulation, increased investment in infrastructure, and a public awareness campaign to boost trust in the technology.

The centrepiece of the plan? A €150 billion investment in European AI over the next five years, backed by 20 key investors.

The initiative has already secured support from major corporations, venture capital firms, and AI startups, marking a significant coordinated efforts to scale AI in Europe. Among the backers are Germany’s Deutsche Bank, defence startup Helsing, French AI darling Mistral, and music-streaming giant Spotify.

In addition, French President Emmanuel Macron also announced this morning a €109 billion pledge for AI development in France.

AI as the cornerstone of Europe’s economic and strategic future

With a collective market capitalisation exceeding €2.9 trillion and a workforce of 3.7 million employees, the initiative’s supporters represent a notable force in European industry.

The new strategy aims to accelerate AI adoption across critical sectors such as manufacturing, energy, healthcare, and defence—all areas where Europe already holds global leadership but has been slow to integrate AI at scale.

At the core of the initiative is a new strategic report, An Ambitious Agenda for European AI, which outlines how Europe can leverage AI to boost productivity, drive economic resilience, and maintain strategic autonomy. The report emphasises the need for radical collaboration between established companies, AI technology providers, and policymakers to unlock AI’s full economic potential​.

Jeannette zu Fürstenberg, managing director and head of Europe at General Catalyst, highlighted the urgency of the moment: “By seizing the moment, working with greater intention and embracing deep collaboration, Europe can seize a generational opportunity by leading in applied AI, integrating it into our industrial base to boost productivity, resilience and economic sovereignty.”

A race to close the gap

The urgency behind this initiative is clear. AI is rapidly reshaping the global economy, with tech giants in the US and China already driving innovation at an unprecedented pace.

According to the Initiative, companies such as Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla—collectively known as the “Magnificent Seven”—have reached a combined market capitalisation of €16.4 trillion, roughly equivalent to the entire GDP of the European Union​.

While Europe produces world-class AI research—nine of the ten most widely used open-source AI models were developed in Europe​—it has yet to convert this technical expertise into scalable economic success. The EU AI Champions Initiative is designed to address and change that.

Stef van Grieken, Co-founder and CEO of Cradle, a BioTech machine learning platform based in the Netherlands and Switzerland, highlighted the urgency of this transformation during the AI Action Summit in Paris: “Cradle is proud to join the EU AI Champions Initiative, launched today at the Elysée Palace. As we join this crucial summit of a broad alliance of European nations, led by President Macron including President Ursula von der Leyen and heads of state from 17 EU member states, their commitment to strengthening Europe’s AI capabilities is evident.”

Van Grieken continued: “The last major technological transitions such as mobile, social and cloud created completely novel markets. As we enter the new area of artificial intelligence many industries that are at the core of Europe’s prosperity will be under pressure to transform. As recently seen with automotive companies, failure to respond in a timely and adequate way to technological disruption can have significant negative consequences for business and the people working there.”

Van Grieken pointed to the pharmaceutical and BioTech sectors as prime examples of industries where AI is already having a transformative impact, noting that European pharmaceutical companies are embracing AI-driven protein design.

“This is a collective effort to turn ambition into reality. With the right talent, resources, and momentum, Europe is ready to lead in the development, deployment and scalability of AI,” van Grieken concluded.

Investment, regulation, and public trust

For Europe to lead in AI, industry leaders and startups argue that three major barriers need to be addressed:

  1. Simplified AI regulation – While the EU AI Act sets a global benchmark for AI safety, startups warn that overly complex rules could stifle innovation. The initiative calls for a more streamlined, pro-business regulatory framework.
  2. Infrastructure investment – AI requires massive computing power and energy resources. Europe must invest in cloud infrastructure, semiconductor manufacturing, and energy-efficient AI data centres.
  3. Public awareness and trust – Misinformation and fear around AI could slow adoption. A large-scale public engagement campaign is planned to showcase AI’s benefits while addressing ethical concerns.

Europe’s AI Investment Boom

The planned €150 billion in AI investment will, in part, focus on:

  • Scaling European AI startups through funding and corporate partnerships.
  • Developing AI models tailored for industrial applications in manufacturing, energy, and pharmaceuticals.
  • Modernising AI infrastructure, including data centres, energy grids, and cloud computing.
  • Strengthening Europe’s semiconductor supply chain to reduce reliance on non-European chipmakers.

According to early projections, GenAI could boost Europe’s annual productivity growth by up to 3% through 2030, adding €575 billion per year in economic value​. This level of AI-driven transformation has the potential to outpace the impact of the cloud computing revolution, which the EU has projected to unlock €2.8 trillion by 2030​ in the Digital Decade Agenda.

AI in motion

With thousands of tech executives, AI researchers, and government leader gathered in Paris for the AI Action Summit, a follow-up to the UK’s AI Safety Summit, the EU AI Champions Initiative could serve as a shift from regulation-focused discussions to tangible investment and deployment strategies.

Beyond industry applications, AI is also a matter of strategic resilience. The report underscores that AI is not just a technological trend but a key determinant of Europe’s future economic strength.

The real challenge now is execution—turning ambition into outcomes that reshape Europe’s technological landscape.

Read the orginal article: https://www.eu-startups.com/2025/02/europes-ai-push-e150-billion-pledge-to-supercharge-european-ai-startups/

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