Tech Landscape in Europe: H1 2025 Analysis Report
European tech investment has witnessed significant changes over the past three years, with shifts in deal counts and capital inflows. According to recent data, the funding environment has become more selective, and the total capital in H1 2025 dropped significantly compared to H1 2024.
In H1 2024, the funding reached a peak of €50.1 billion, marking the highest funding ever recorded. However, H1 2025 saw a steady deal count but a significant decrease in total capital compared to previous years. The number of deals in H1 2025 remained just under 2,000, which is relatively consistent compared to the previous years.
The trend suggests a more cautious and selective funding environment in H1 2025. This could be due to the increasing investor interest in technology-themed assets in Europe, as professional investor interest in internet- or technology-themed ETFs jumped from 27% in 2020 to 70% in 2023 in Europe and other major markets.
Notable large-scale transactions highlight continued capital investments in European technology firms. For instance, in 2025, Dutch semiconductor company NXP B.V. acquired Austrian automotive tech firm TTTech Auto for USD 625 million, focusing on software-defined vehicles. This reflects ongoing consolidation and capital inflow into high-growth subsectors like automotive software and safety technology.
However, regional differences exist within Europe. For example, Poland’s overall innovation investment has declined relative to the EU average since 2018, primarily due to low R&D spending and limited public-private collaboration. However, Poland improved significantly in investments related to information technologies, particularly cloud computing, indicating focused tech investment growth despite broader challenges.
Tech investment themes have evolved, with increasing attention to disruptive innovation, cybersecurity, and digital assets. Moreover, emerging fields like nuclear energy tech, supported by frameworks like the EU Taxonomy, are being evaluated for their investment potential within Europe’s tech landscape.
In summary, European tech investment over the past three years exhibits growing capital inflow driven by rising thematic investor interest and strategic acquisitions in advanced tech sectors, though regional disparities exist with some countries improving in IT-specific investments while overall innovation investment growth varies.
Investors are increasingly focusing on technology-themed assets, as professional investor interest in internet- or technology-themed ETFs in Europe has risen from 27% in 2020 to 70% in 2023. Notable transactions, such as the acquisition of Austrian automotive tech firm TTTech Auto by Dutch semiconductor company NXP B.V. for USD 625 million, showcase ongoing capital investments in European technology firms.
