Sifted has done the full interrogation on funding numbers for the first six months of 2025. The results are in our new midyear report.
Headlines that jump out: AI-native funding is up 61%, German deeptech startups are hoovering up capital, climate tech has suffered a big drop.
Discerning readers — of which Sifted has many — will know all of this already. So our goal here is to highlight some of the lesser-reported, but no less intriguing, tales of H1.
Fintech: a victim of its own success?
Fintech had a small dip in H1: nothing dramatic, just a bit meh. The numbers “fall short of a return to form for the sector,” Sifted’s fintech reporter Tom Matsuda writes in the report. “And reflect a sentiment among VCs that many of the leading players in fintech have reached a level of maturity that would make it challenging for a new entrant to break through.” The likes of Monzo, Revolut and Starling have millions of customers and consecutive years of profitability. That’s nice for them, but this dominance may also be a reason for investors to look elsewhere.
Amsterdam’s got AI moves, too
Some 17% of funding rounds raised in Amsterdam in H1 were by AI-native startups, meaning those developing generative AI applications, AI agents and specialised AI hardware. That’s a bigger proportion than in Paris (12.8%), London (11.9%) and Stockholm (8.8%), which are considered Europe’s three big AI hubs. “We might have been off to a slower start, but we have always been a very relevant player in AI,” says Bas Rieter, investor with Amsterdam-based Dutch Founders Fund. “That’s thanks to fantastic technical universities, virtually no language barrier and talent clusters forming around ‘hot’ companies like Cusp AI, Cradle and Monumental.”
AI frees up Europe’s technical talent
The median deal size in deeptech reached €4.4m in H1 — higher than any other vertical, and 40% higher than the same period in 2024. Deeptech startups generally require more capital than their peers given the complexities of the technology they are developing, often with hardware systems in sectors such as quantum computing, spacetech, robotics and defence tech.
“Europe’s natural advantages in research infrastructure suddenly look a lot less boring,” writes Saish Rane, a Paris-based investor. “While the Valley’s been optimising ad clicks, we’ve been quietly building the world’s deepest bench in materials science, precision manufacturing and industrial systems. And as AI frees up this talent, it’s all flowing toward the hard stuff: climate adaptation, advanced materials and precision medicine.”
A vast venture debt desert
It’s common for startups in the US to raise a little venture debt on the side of an equity round. Not so in Europe, where most of the continent is still figuring out this financing option. Venture debt is heavily concentrated: 66% of debt financing in H1 went to startups in the UK, Germany and Netherlands (without the €1.3bn raised by Romanian gaming company SuperBet, that figure rises to 82%). “We only focus on northern Europe: not all lenders want to go too far east, because they don’t understand all the rules and regulations for lending in this part of Europe,” says Sean Duffy, managing director of CIBC Innovation Banking’s UK and Europe division. “Plenty still to do to develop this market.”
Series A and B rounds: looking more like that Spiderman finger-pointing meme
The gap between Series A and B round sizes in Europe is narrowing. Sifted tracks median deal sizes across rounds, sectors and verticals to spot pockets of growth — which usually signals an uptick in competitive, oversubscribed rounds — and decline, signalling the opposite. Median Series Bs have fallen quite significantly from €39.6m in H1 last year, to €35m in H2, all the way down to €29.6m in the first half of 2025 — a 25.3% decrease year-on-year.
Meanwhile, the median Series A has nudged up past €14m. It suggests that companies in demand are coming back to the table quicker than they may have done previously and raising a smaller round at Series B to maintain momentum. For example, buzzy London-based AI notetaking assistant Granola has already raised two additional rounds since its $4.3m seed in May 2024: a $20m Series A in October that year and a $42m Series B in May 2025.
Chart design by Gaétan Nivon
Read the orginal article: https://sifted.eu/articles/europes-lesser-reported-h1-stories-in-5-charts/
