Sifted - Europe's new deeptech hotspot

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On the agenda today, "France's Silicon Valley" is having its moment in the sun, early-stage funding saw signs of a resurgence last month and German CVCs are still putting more cash into US startups than they are European ones.

— Amy Lewin, editor

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Grenoble: Europe’s new deeptech hotspot

Grenoble, known in some circles as “France’s Silicon Valley”, is having its

moment in the sun. 

In September, low-carbon battery startup Verkor raised €2bn in financing, including €850m in equity, to build a gigafactory. Earlier in the year, other startups working on semiconductors, nuclear fusion and quantum computing

all raised double-digit funding rounds too. 

Grenoble currently ranks fourth (tied with Munich) for deeptech funding among European cities in 2023, behind Stockholm, Paris and London. 

But, local entrepreneurs say, it could be even more prominent soon; the city has a unique mix of academia, public innovation hubs, large industrial players, small upstarts — and — now, increasing amounts of venture capital too.

🇪🇸 Spanish power provider Holaluz is cutting 200 jobs. Just four years after going public with a €160m valuation, Holaluz is shedding 27% of its staff amid falling demand for solar panels. 

• The company, which offers 100% renewable energy as well as solar panel installation, has struggled with high interest rates, government subsidies on household energy prices and competition from oil and gas giants that offer cheaper power to consumers. 
• CEO and cofounder Carlota Pi said that despite the cuts, Holaluz “will continue to lead on the transition toward an energy model 100% green.” 

🇪🇸 Cabify refinances its debt. Madrid’s ride-hailing unicorn Cabify has renegotiated its €60m debt as revenues in the first half of 2023 rose to €420m, almost €100m more than H2 2022. 

• Cabify saw a 33% rise in services to private customers, according to data from UBS, which has been hired by Rakuten to sell its 47% stake in the company. 
• The startup was meant to repay almost half of its debt to Inter-American Development Bank this year, but now has a two-year extension.
• Cabify’s EBITDA was negative in the first half of 2023, potentially pouring cold water on founder Juan de Antonio’s plans for an IPO in 2024.

🇬🇧 Some well-known names in Britain’s startup community lost their jobs, stepped down or moved into new roles amid British prime minister Rishi Sunak’s cabinet reshuffle yesterday. 

• Science minister George Freeman, tech minister Paul Scully and transport minister Jesse Norman are all out. 
• Health secretary Steve Barclay became environment secretary, replacing Thérèse Coffey. Sunak handed Barclay’s old job to Victoria Atkins. She was previously financial secretary to the Treasury.
• Greg Hands has become a business and trade minister (for the fourth time).

🇫🇮 Finnish satellite spacetech ICEYE has put four additional SAR satellites into orbit, carried by SpaceX rockets and fired from California. The company has deployed 31 satellites since 2018.

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😩 ‘When I see you, three young women, I’m not so sure.’ Funding for startups has reduced dramatically across Europe so far in 2023, and founders across the board are struggling to secure their next round of funding. But for companies like female-founded health app Omena, that could spell greater trouble, as cofounder Mathilde Nême found out when she went out to raise the startup's second round of funding. “We’re women, we’re young, we’re doing femtech,” she says. “Clearly, that doesn’t help.”

💬 When Zareen Ali was growing up she found people impossible to understand. Many years later she was diagnosed as neurodivergent and it suddenly made sense why. Now, Ali says, we have an opportunity to make AI a useful and accessible tool for neurodivergent people. Here’s what we have to do to achieve it. 

🤖 How to turbocharge your productivity with a GenAI assistant (sponsored by Zoom)

⏰ How to get fundraise-ready without spending all your time on it (sponsored by Floww x LESG)

German corporate venture funds still invest more in US than European startups. 

• Since 2010, the five most valuable German corporations (SAP, Deutsche Telekom, Siemens, Airbus and Allianz) have made 498 investments into US startups vs 129 investments into European startups. 
• In 2022, those five CVCs made 13 investments into European startups (totalling $603m) vs. 35 into US startups.
• But so far this year, the group’s made just six investments in Europe — totalling $161m — a decrease of 75%.

European pre-seed and seed-stage startups raised €599m in October, compared to €488m in September AND €373m in October 2022.

• There were also more deals — 361 in October, compared to 287 in September, according to Dealroom data.
• And fintech took the top spot for funding, coming out of a several month slump.

🔥 Spanish startup Kamleon has raised €1m in pre-seed cash for its S-Urinal product for the sports sector, a smart urinal that measures people’s hydration levels in real time. Investors included former Spain and Real Madrid goalkeeper Iker Casillas and former Barcelona star Gerard Piqué.

🔥 Scottish startup Mocean Energy, which develops wave energy converters to provide ocean equipment and the grid with clean energy, has raised £2.2m from existing investors including Scottish Enterprise and the University of Edinburgh’s venture fund, as well as new shareholders including Katapult Ocean and MOL PLUS. The company has also raised £500k in grant money. 

🔥 French logistics startup Stockoss, an end-to-end supply chain management platform, has raised €4m in seed funding led by Pi Labs. 

🔥🔥 Norwegian startup Otovo, a residential solar and battery installations marketplace, has raised €40m in a private shares placement.

🔥🔥 UK-based blockchain fintech Fnality has raised a £77m Series B led by Goldman Sachs and BNP Paribas.

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