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Why Paris is the best European startup hub
Paris overtakes London as the best European startup hub, how FlexAI is powering AI Infrastructure for Europe, and more...
SearchVentures
May 28, 2025
Paris is now the best startup ecosystem
For the first time, Paris has overtaken London as Europe’s top-ranked startup hub, driven by AI momentum, public investment, and a sharp rise in enterprise value.
What’s driving Paris’s sudden rise?
This Week’s Trends
How Paris beat London as the best place for startups
How FlexAI is powering AI Infrastructure for Europe
Startup with $13 million seed funding and more
Read Time 3 minutes
The Startup Trend
Best startup ecosystems in Europe
According to a Dealroom report, Paris ranks #1 in Europe, ahead of London, Stockholm, and Munich, scoring highest across VC, patents, and AI strength.
> From 2017 to 2024, Paris startups grew their combined enterprise value by 5.3x, outpacing London’s 4.2x, despite raising nearly half as much funding.
> AI now accounts for nearly half of Paris’s VC funding. Deals like Poolside and Mistral, along with AI talent from École Polytechnique, are reshaping the ecosystem.
💡 Paris’s rise is the result of long-term bets on talent, research, and AI, showing how strategy can beat sheer size and shift Europe’s startup balance.
Startup Feature
How FlexAI Is Quietly Building Europe’s AI Infrastructure
While most AI startups race to launch consumer apps, FlexAI is focused on what powers them. Based in Paris, the startup is building core infrastructure to help companies deploy AI models more efficiently across chips and cloud platforms.
As AI models grow larger and more complex, the shortage of compute has become a growing problem. FlexAI has raised over $30 million in seed funding in one of the largest seed rounds in Europe this year with the goal of making compute flexible and easily accessible at scale.
Solving the Compute Bottleneck
Access to compute is now a major hurdle for AI startups. Chip shortages, vendor lock-in, and high costs have created friction that slows down innovation.
FlexAI addresses this by creating a software layer that connects different types of processors and environments, allowing developers to train AI models more efficiently and at a reduced cost by only paying for what they need without the high upfront costs of buying GPUs.
Its platform aggregates processing capacity from existing data centers and adds a software layer that allows startups and enterprises to access compute without being locked into a single provider.
“Most teams today are spending more time wrangling infrastructure than developing models. We want to flip that.”
FlexAI’s approach is similar to how cloud services changed software delivery. It gives teams access to infrastructure without needing to control or fully understand the physical layer. This is now a growing necessity for AI developers across Europe, where hardware scarcity and cost barriers are more visible than in the US or China.
The Infrastructure Play Europe Needs
While most attention has gone to AI models and applications, the infrastructure powering those models is under strain. Training foundation models requires massive compute power.
As the demand for AI infrastructure grows, there is increasing pressure from European governments and enterprises to avoid total dependency on American cloud providers. FlexAI is part of a new group of startups working to build sovereign infrastructure without sacrificing global competitiveness.
“The future of AI infrastructure will not be built in just one place. Europe has the talent, the demand and the urgency to do this differently.”
FlexAI’s model is not about replacing Amazon or Microsoft. It is about offering an alternative that aligns with Europe’s regulatory environment, procurement needs and cost structures.
With fresh capital and a growing team in Paris, it is now building the integrations and partnerships to scale across Europe.
Headline News
This Week In Startups ✍️
Founders
> SpAItial, an AI startup, has emerged from stealth mode with a $13 million seed round led by Earlybird Venture Capital and joined by several high-profile angels.
> Volare, a Finnish biotech company, has closed a €26 million funding round to advance sustainable insect protein production.
> Inven, a Finnish AI-native deal sourcing platform, raises $12.8 million Series A led by Ventech VC and Vendep Capital.
Investors & VCs
> QuantumLight, a VC firm led by Revolut founder Nik Storonsky, has closed a $250 million fund, signalling confidence in its AI-led deal decision-making platform.
> Cathay Innovation, a global VC firm based in Paris, has closed a €1 billion multi-stage fund dedicated to AI.
> Lunar Ventures has closed its second fund of €50 million to invest in pre-seed deeptech startups across Europe and the US.
Cheers,
Odin Lund & Hari Mohandas
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