(Editor’s note: The Eindhoven Business Briefing focusing on Europe’s new 5 billion euro Scale Up Europe fund is part of Dispatches Europe’s Tech Tuesday series. Dispatches covers tech because so many of our highly skilled internationals are engineers and founders.)
As European leaders feel the pressure to achieve “tech sovereignty” while falling farther behind the United States, their response seems to be, “We’ll fund our way out of this” while creating new bureaucracies.
On 3 June, the European Union is launching the Scaleup Europe Fund, the EU’s 5 billion euro investment fund for scaling up promising young tech companies in hopes they’ll become European tech giants … and not run away to Sand Hill Road for funding, then move to The Valley. The fund is billed as “a new, multi-billion late-stage and growth fund aimed at investing in the most promising European companies in strategic tech areas such as artificial intelligence, quantum technologies, semiconductor technologies, robotics and autonomous systems, energy technologies, space technologies, biotechnologies, medical technologies, advanced materials and agritech and across all parts of Europe.” Deep breath.
The Scaleup Europe fund will invest directly in “strategic technology companies” starting with Series B level investments. The plan is for 1 billion euros to come from Horizon Europe, the EU’s research and innovation program, with 4 billion euros from private investors. Sifted reports that at the end of 2025, private investors had committed 1.5 billion euros.
Alongside the European Commission, founding investors include Novo Holdings, EIFO (Export and Investment Fund of Denmark), CriteriaCaixa, Santander/Mouro Capital, Fondazione Compagnia San Paolo/ Intesa Sanpaolo/Fondazione Cariplo, APG Asset Management, acting on behalf of Dutch pension fund ABP, Wallenberg Investments and Allianz. So, some pretty big names not previously associated with tech investing in Europe.
From what we’ve read, Scaleup Europe will be able to write tickets for 100 million and above, including follow-on investments.
The EU’s main innovation agency, the European Innovation Council. has appointed Swedish investment firm EQT as manager of the new fund. The idea is that EQT will run the fund like a private-sector fund and not like a government lottery that randomly hands out funding based on some bureaucrat’s whim and political favoritism. And you have to admire Europe’s unbreakable conviction that one more government program will push the EU over the top.
The most troubling element of this whole ambitious state intervention is that EQT claims to be Europe’s largest private market investor, with – drumroll – 269 billion euros in total assets under management. How does that compare to American VCs and private equity funds? The largest U.S. private equity and alternative asset managers such as Blackstone have $1 trillion AUM, and the largest VCs such as Andreessen Horowitz also are right at $1 trillion AUM these days. Sand Hill Road alone, not to mention Boston and Wall Street, has dozens of investment firms bigger than EQT and bigger than Scaleup Europe Fund.
As we posted in the most recent EBB, Eindhoven startups and scale-ups are starting to attract real funding from the private sector. The positive part of this is the EU is trying to motivate more and bigger private investors and pension funds to finally taking significant positions in European scale-ups.
The downside of this is, 100 million is where American investors start for AI startups.
So, explain to us like a child, or a golden retriever, how this initiative keeps the most promising European scale-ups down on the farm.
Stay or go … that is the question
We posted in the most recent EBB that Eindhoven startups and scale-ups are starting to attract serious funding from the private sector.
But for moonshot semiconductor efforts such as Euclyd, is there even enough risk capital in Europe?
Last week, at the AI Meet-Up XL: Towards Europe’s Full Stack AI Sovereignty event at High Tech Campus Eindhoven, Euclyd co-founder Bernardo Kastrup could not bring himself to say he would never take Euclyd to the U.S. when moderator Irene Rompa broached the question.
We reached out to Bernardo for clarification and got this response:
Irene asked me if U.S. investors were requesting me to move the company’s headquarters to the USA. That’s what I declined to answer. I, as a shareholder, definitely prefer that Euclyd stays in Europe. As a CEO, I must do whatever is best for the company. We see more market potential in the USA. Way more than in Europe at this point.
During his part of the discussion, Bernardo advocated for building fabs, essentially chip factories, in the EU rather than relying on TSMC in Taiwan.
Just as we were posting, we saw this on LinkedIn from VC Michael Jackson:
“Building a global tech company from a European base has also gotten harder over the past decade.” – Robert Vis
And reality is that it’s only going to get even harder going forward. Market fragmentation, energy costs, regulations, taxes, customer base, etc. aren’t getting any better in Europe. All the reports and letters and posts and committees and ‘wake-up calls’ fall on deaf ears. Europe needs to act with urgency, but that is not what’s happening. In my 20ish years of investing on both sides of the Atlantic I’ve never seen more European founders moving to the US than I see now. And they should be. Europe hasn’t done enough to keep them.
Read more here on X about Vis’s observations.
Open Day is Sat., 13 June
During Open Day, High Tech Campus Eindhoven comes to life with a wide range of activities across multiple locations. Bear in mind that this was once the gated and guarded campus for Philips, so below the radar there were people in Eindhoven who had never been allowed to visit.
Now, the big names on campus such as Philips, NXP Semiconductors, Signify, Shimano, TMC and Brunel will open their doors and offer demos, showcases and interactive experiences.
This will be our fourth Open Day, and each one has been a real festival of fun and tech, with music, food, sports and other stuff. Dispatches always assisted with the startup exhibits, and we’ll be in HTC 37 this year. So come by and say howdy. We’ll have more details as we get closer to the event.
More events on campus.
In addition, June is packed with events. Explore the campus lineup covering topics including AI governance, engineering simulation, healthcare innovation, robotics and digital engineering.
Here’s what’s coming up:
• 27 May: 𝘎𝘰𝘷𝘦𝘳𝘯𝘪𝘯𝘨 𝘈𝘐 𝘢𝘵 𝘚𝘤𝘢𝘭𝘦
An executive roundtable by The Shift Academy (Agentic Shift (EU)
🔗 https://lnkd.in/e6tW7ETA
• 9 June: 𝘈𝘤𝘤𝘦𝘭𝘦𝘳𝘢𝘵𝘪𝘯𝘨 𝘌𝘭𝘦𝘤𝘵𝘳𝘰𝘯𝘪𝘤𝘴 𝘐𝘯𝘯𝘰𝘷𝘢𝘵𝘪𝘰𝘯 𝘸𝘪𝘵𝘩 𝘚𝘪𝘮𝘶𝘭𝘢𝘵𝘪𝘰𝘯
An event bij Dassault Systèmes and HiTech BV
🔗 https://lnkd.in/eEh9FzP7
• 23 June: 𝘔𝘉𝘚𝘌 𝘪𝘯 𝘈𝘤𝘵𝘪𝘰𝘯: 𝘉𝘦𝘺𝘰𝘯𝘥 𝘋𝘰𝘤𝘶𝘮𝘦𝘯𝘵𝘴, 𝘛𝘰𝘸𝘢𝘳𝘥𝘴 𝘋𝘪𝘨𝘪𝘵𝘢𝘭 𝘌𝘯𝘨𝘪𝘯𝘦𝘦𝘳𝘪𝘯𝘨
An event by Dassault Systèmes
🔗 https://lnkd.in/eZvvBUvb
• 23 June: 𝘗𝘩𝘺𝘴𝘪𝘤𝘢𝘭 𝘈𝘐: 𝘙𝘰𝘣𝘰𝘵𝘪𝘤 𝘔𝘢𝘯𝘪𝘱𝘶𝘭𝘢𝘵𝘪𝘰𝘯 𝘪𝘯 𝘵𝘩𝘦 𝘖𝘱𝘦𝘯 𝘞𝘰𝘳𝘭𝘥
An event by 3EALITY
🔗 https://lnkd.in/eFZTssV4
• 30 June: 𝘊𝘭𝘢𝘶𝘥𝘦 𝘊𝘰𝘥𝘦 𝘰𝘯 𝘈𝘮𝘢𝘻𝘰𝘯 𝘉𝘦𝘥𝘳𝘰𝘤𝘬
A hands-on workshop by Amazon Web Services (AWS)
🔗 https://lnkd.in/eSFeUupU
Co-CEO of Dispatches Europe. A former military reporter, I'm a serial expat who has lived in France, Turkey, Germany and the Netherlands.
