Hybridity, a Stockholm-based AI RegTech startup, raises €2 million (SEK 22 million) funding to accelerate the commercialisation of its AI platform Hy5, which automates complex EU regulations like DORA, NIS2, and GDPR.
Its new investors include Henrik Ekelund (BTS Group), Hans Otterling, and Jörgen Bladh (formerly Northzone). New investors also include the family office Fonos with the Irinarchos family, and Björn Hovstadius, founder of Pagero and board member of the European Big Data Value Association. The Swedish company previously closed a €2.16 million (SEK 23 million) Seed round in March 2025, bringing its total funding amount to €5 million (SEK 54 million).
“Compliance is one of the biggest operational barriers to growth in regulated industries, costing European businesses over €150 billion annually. Our platform Hy5 enables organisations to manage complex regulations continuously and at scale with the help of AI, instead of relying on manual processes. The new capital allows us to take the next step in commercialisation,” says Magnus Sahlgren, CEO of Hybridity.
Sahlgren joined Hybridity as CEO on February 1. Formerly, he was the head of research for Language Technologies (NLU) at AI Sweden and possesses over 20 years of experience in AI research, language technology, and applied machine learning.
Some previous EU-Startups coverage of funding rounds from the AI RegTech / regulatory compliance automation sector includes the €30 million Series B funding round of Danish RegTech startup Formalize, €6.8 million Series A funding round of Dublin-based Dataships to automate compliance for the eCommerce sector. In the environmental compliance segment, Germany’s Tanso raised €12 million to expand its industrial environmental compliance platform.
Hybridity was founded in 2023 with the aim to automate and facilitate the way organisations work with regulations via its AI-native platform Hy5. According to the company, it transforms regulatory compliance by combining artificial intelligence with legal engineering.
The company states that Hy5 automates regulatory compliance by structuring AI to perform the heavy lifting work, which allows organisations to grow faster, stay continuously compliant and manage risk effectively.
According to Hybridity, its platform can automatically review contracts to ensure compliance with regulations such as CSRD, DORA, NIS2, GDPR, and SFDR, identify gaps and inconsistencies, and generate action lists. The platform can also automate CSRD reporting and conduct GAP analyses, and ensure that policy documents remain up to date and can generate AI-based handbooks from existing governance documents.
“Hybridity has developed a technically strong solution for a large and rapidly growing problem. The combination of deep AI expertise and a clear business focus positions the company well to scale internationally,” says Hans Otterling.
The company is previously backed by tech investors, including Noam Perski, Head of Europe at Palantir, Stefan Lennhammer, Chairman of the Board at Hybridity, former Chairman of the Board at Truecaller and founder of Reeda Capital Family Office, as well as co-founder of Catella and Stronghold, and Simon Josefsson, former CTO at Yubico.
Read the orginal article: https://www.eu-startups.com/2026/02/stockholm-based-hybridity-raises-e2-million-to-automate-regulatory-compliance-through-ai/
