Nearly 80 European deep-tech university spinouts reached $1 billion valuation or $100 million in revenue by 2025 | TechCrunch

Universities and research labs have long been Europe’s deep tech treasure trove. Now, academic spinouts have consolidated into a solid startup funnel worth $398 billion — and venture capital money is following.

According to Dealroom European Spinout Report 202576 of these deep tech and life sciences companies have reached a $1 billion valuation, $100 million in revenue, or both. This includes unicorns such as Iceye, IQM, Isar Aerospace, Synthesia and Tekever, which are now inspiring more funds to support university spin-outs.

Just this month, two new funds have emerged that will provide more funding for talent coming out of Europe’s technology universities, while adding breadth to a pipeline currently led by Cambridge, Oxford and ETH Zurich.

PSV Hafniumfrom Denmark, recently closed its first fund on an oversubscription of €60 million (approximately $71 million), with a focus on Scandinavian deep tech. With offices in Berlin and London, but also in Aachen, U2V (University2Ventures) is targeting the same amount for its first fund, which it recently decided to fund completed the first closure.

These two newcomers join the growing ranks of European venture firms that have university spinouts as a core part of their investment thesis. This category, developed by the likes of Cambridge Innovation Capital and Oxford Science Enterprises, which have now fully matured, has also diversified.

While still largely made up of funds backed by one or more universities and institutes, it now also includes independent companies that see spinouts simply as potential fund returners – and rightly so. Oxford Ionics, acquired by the American IonQwas one of six spinouts from Switzerland, Britain and Germany that delivered exits of more than $1 billion to their investors by 2025.

These exits are associated with higher financing amounts. According to Dealroom, European university spinouts in deep tech and life sciences are on track to raise a near-record high of $9.1 billion by 2025. This is in stark contrast to total venture capital funding in Europe, which is down almost 50% from its 2021 peak.

Grand rounds completed by 2025 also reflect demand for spinouts in sectors as diverse as nuclear energy – Proxima Fusion – and dual-use drones – Quantum Systems, now with a value of more than $3 billion. In many cases, these startups use research from specialized laboratories, which also explains why there is a long line of European locations that can produce spin-outs.

Building relationships with hubs outside Oxbridge and leading countries can also be a way for newcomers to differentiate themselves and find deals. “Scandinavia’s research institutions have extraordinary, untapped potential,” said the partners of PSV Hafnium in a press release.

PSV Hafnium is itself a spin-out of the Technical University of Denmark (DTU), but also makes early-stage investments in other Scandinavian countries. One of the nine checks so far went to We are Semitica Finnish startup using a decade of research at the University of Turku to bring new surface cleaning technology to the semiconductor industry.

It’s good news for teams like SisuSemi that more funding is available to them. It is also in addition to subsidies, commercialization support and improved deal terms that contribute to an encouraging environment for the European spin-outs. However, one sore point remains: growth capital.

As the report’s authors note, this gap “is not a unique trend to spinouts, but something that affects the entire startup ecosystem in Europe.” Yet it is quite striking that almost 50% of late-stage funding for European deep tech and life sciences spinouts comes from outside Europe, mainly from the US.

Although this share has declined over the years, Europe will not reap the full benefits of its investments in talent and research unless this changes substantially – but that is a wider problem that needs to be solved.