Niklas Zennström, one of Europe's most successful technology entrepreneurs and investors, believes startups on the continent can still succeed in AI despite the huge funding gap with their US rivals.
European startups can thrive by developing applications built on AI platforms run by US-based companies such as OpenAI or Google. Zennstrom He told the Financial Times.
“Think about what happened with mobile and the cloud: There are only a few cloud providers in the world, and they are empowering thousands and thousands of companies,” he said in an interview. “It's not like everyone needs to be a big language model. . . . You can create value as an application provider.”
The comments from a leading industry voice come as European policymakers and investors worry that the United States is getting ahead of the region. Amnesty International.
Many worry that Europe once again risks being left behind by deep-pocketed Silicon Valley groups in transformative new technology, with huge consequences for the region's competitiveness and national security.
The European technology industry has created hundreds of “startups” — private companies valued at more than $1 billion — and has narrowed the gap in early-stage funding with the United States “regardless of whether Europe has much of the critical (technological) infrastructure that is considered European.” “, the Skype co-founder told the Financial Times.
“European companies can build on (AI platforms) whether they are from France or from the United States,” he said.
European entrepreneurs' confidence in the region's technology prospects will reach a new low in 2024, according to a new report. State of European technology A report by Atomico, the venture firm founded by the Swedish entrepreneur in 2006. Its latest survey found that 40 percent of founders felt “less optimistic” about the future of European technology compared to the previous year.
However, while admitting 2024 was “very difficult” for startups and investors, with capital invested in European tech expected to decline for the third year in a row, Zennström believes pessimism about the region’s prospects is overblown.
“It is a European problem to talk about the problem,” he said. “There's a lot of exciting data that shows we're really catching up (with the U.S.), and we're doing very well.”
Despite this progress in the European technology industry in general, the transatlantic investment gap in AI startups in particular is stark.
A a report Published in October, venture firm Accel found that US investment in generative AI reached nearly $48 billion in 2023 and 2024 combined, more than five times the investment in Europe and Israel, where total funding in This sector is about $9 billion.
A large portion of US GDP is driven by startups developing so-called “foundation” models, the expensive and complex AI systems that underpin general-purpose chatbots and media creation services, like OpenAI’s GPT.
In Europe, there are a few startups working on enterprise models, including companies based in Paris Mistral and Black Forest Laboratories in Germany.
However, US-based companies OpenAI, Anthropic and xAI have together raised tens of billions of dollars more than their European rivals, while major tech groups Microsoft, Google, Amazon and Meta are also companies. Invest heavily In their large linguistic models.
Atomico, which raised $1.24 billion in new funds in 2024, has backed European AI startups that build more specialized models around specific applications, including Corti, a Danish manufacturer of digital assistants for healthcare, and Germany's DeepL, which Provides machine translation tools. .
“It's not just five LLMs,” Zennstrom said. “There's also a lot more being created in terms of value.”
But he admitted that “the jury is still out” on whether Europe can build competitive, general-purpose MBA programs in the long term.
“What you need for AI is you need a lot of money, you need a lot of data, you need distribution. So naturally the big tech companies will have a competitive advantage,” Zennstrom said. “The fact is that the rich are getting richer.”
