Europe’s AI startups look stateside for bigger checks, quicker deals

Within a week of landing in San Francisco, Brandon Abreu Smith had something that had eluded him for months in London: $500,000 in pre-seed funding for his artificial intelligence-based workflow startup, Structured AI.

- Anvee Bhutani [e-mail]

Smith and his co-founders had been working 9-to-5 jobs and thought the startup world was out of their reach before heading to the U.S. Now, they have money to hire engineers and recently won a spot at Y Combinator, the famed Silicon Valley accelerator.

"SF is where it all happens," Smith said.

The British entrepreneur is among a new crop of European tech founders seeking to raise their first checks across the Atlantic, and in some cases moving their fledgling businesses there too.

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The U.S. has long wooed European startups with a deeper pool of capital and a more risk-tolerant culture. But with Al's heavy upfront costs for powerful computing infrastructure and specialist talent, founders say the pull of America is greater than ever.

That's a concern for Europe, which wants to establish itself as a global AI hub to rival the U.S. and China. The region's inability to create big tech firms is also seen as a reason why its economies are stagnating.

While Europe's venturecapital scene has grown in recent years, it still lags behind the U.S. American AI and machine-learning startups raised more than $160 billion in the first nine months of this year, far outstripping the roughly $20 billion pulled in by those in Europe, according to data provider PitchBook.

U.S. investors also account for a growing share of the money raised by AI startups in Europe. As of Sept. 30, they had spent about $14.2 billion across 549 European AI and machine-learning VC deals this year, up from $11.7 billion in all of 2024, PitchBook data show. That represents 71.1% of deals by value, up from 57.5% last year.