Europe's climate -Tech -startups collected 2.3 billion USD (2 billion €) In the first quarter of this year – the lowest sum since the third quarter of 2020, according to Dealroom.
Behind the headline there is a complex mix of growing pain, the shift in investor and a wider VC market dynamics, said experts TNW.
In particular, they said that the slowdown was based on a mixture of market maturity, strategic repositioning, oversized capital and a difficult exit environment.
“If we use the story of Dunning Kruger curveWe are now in the climate in the climate, at least for investors. ” Rokas Peciulaitis, founder and managing partner of Contrary Ventures in Lithuania, told TNW.
“NO Fast victories, no massive outputs, mergers and acquisitions are limited, “he added.” Most companies needed more capital than accepted and did not show enough traction. The regulatory tail wind also completely failed in most cases. ”
However, peciulaitis believes that there is light at the end of the tunnel. “I think those who are disciplined will prevail and win, both on the founder and on the VC page,” he said.
Startups of the European climate tech recorded $ 2.3 billion in the first quarter of 2025. This graphic also contains the beginning of Q2. Credit: Dealrom
The financing dip from an extraordinary run comes from the back. The European climate tech financing has increased in the past ten years. The best year of the sector was more than her colleagues in the USA in 2023 when Klima -Tech -Tech -Startups collected $ 15 billion in risk capital. Despite a total of poor financing environment this year.
Orla Browne, head of insights in the dealroom, told TNW that there were several possible reasons why the European Climate Tech -Financing had so far slowed down in 2025.
First, the market matures. Some forms of Cleanetech who have previously attracted a lot of VC bar money – such as startups for electromobility – have become mainstream. If these markets become more established and the growth stabilizes, they tend to attract less venture financing in the early stages, said Browne.
Investor Hype around AI could also make the slowdown. “AI takes the oxygen from VC, at least for other sectors,” said Browne. “More than 25% of all VC now go to AI startups, a few years ago.”
Another reason for the break -in could be that startups for Klima -Tech are amplifying as “resilience” or “security” in order to benefit from the exploding defense -tech editions and the current advance of Europe for technical sovereignty.
The dip probably also signals a broader return after an unprecedented increase in VC investments in 2021. But Peciulaitis believes that there could be a lot “Unsseerced Deals” in the pipeline this year.
Start -up financing is one of the most important topics TNW conferencewhich takes place on June 19 to 20 in Amsterdam. Tickets for the Event are now for sale – Use the Code TNWXMedia2025 at the cash register to get a 30% discount.
