While many embrace “Dry January” for a fresh start, Europe’s startup sector began the year with significant activity, defying any notion of restraint.
The initial weeks of 2026 saw five European startups achieve unicorn status, each valued over $1 billion. These new unicorns emerged from diverse fields, including cybersecurity, cloud optimization, defense technology, ESG software, and education technology.
This surge in activity suggests more than just a funding increase; it points to a developing innovation identity for Europe. There is a growing conviction that the continent can cultivate and expand world-class tech companies independently, rather than primarily serving as a source for later-stage acquisitions by U.S. firms.
Although the United States maintains its lead in startup volume and ecosystem strength, Europe’s recent progress indicates its innovation landscape is maturing and building global confidence.
By late 2025, Europe already hosted over 217 unicorns across various sectors like fintech, AI, and enterprise software. This represents a significant achievement for a region traditionally known for its cautious venture culture.
The new unicorns
- Aikido Security (Belgium): This cybersecurity platform achieved unicorn status with a $60 million Series B round, reaching a valuation of approximately $1 billion. Aikido provides tools for unifying security throughout the software development lifecycle and has reported significant revenue and customer expansion.
- Cast AI (Lithuania / Global): Becoming Lithuania’s fifth unicorn, Cast AI surpassed a $1 billion valuation following a strategic investment. The company develops technology to optimize cloud infrastructure and AI workload deployment, assisting enterprises in reducing GPU expenses and operational complexity.
- Harmattan AI (France): This French defense software startup secured a valuation of about $1.4 billion after a $200 million Series B funding round. Harmattan AI focuses on developing mission systems and autonomous capabilities for defense applications, attracting early interest from industry collaborators.
- Osapiens (Germany): Osapiens reached unicorn status with a valuation exceeding $1.1 billion after a $100 million Series C round led by Decarbonization Partners. Its platform supports large enterprises with ESG data management, sustainability reporting, and compliance, driven by increasing regulatory requirements.
- Preply (Ukraine / Global): The edtech marketplace, now valued at approximately $1.2 billion after a $150 million Series D, connects students with tutors globally. Preply’s approach, combining human instruction with AI enhancements, has achieved global scale while maintaining strong operational ties to its Ukrainian founders and teams.
More than a unicorn rush
The significance lies not just in the quantity of new billion-dollar companies, but in their diverse nature. The era where a single sector, such as generative AI, predominantly shaped European unicorn growth appears to be evolving. Now, cybersecurity, cloud optimization, defense software, sustainability data, and education marketplaces are all attracting top valuations and investor support.
A broader perspective reveals that in 2025, deep-tech and university spinouts, encompassing aerospace, robotics, materials, sensors, and health sciences companies, received near-record funding levels, with many reaching substantial valuation or revenue milestones.
This trend aligns with a clearer narrative: European capital is demonstrating deliberate investment rather than exuberance. Investors are funding ventures where market traction, viable revenue models, and regulatory demand intersect. This explains the attention given to platforms assisting with compliance and ESG reporting, or cloud efficiency infrastructure, alongside defense-tech innovators.
Europe’s tech ecosystem has matured despite ongoing challenges. While venture funding saw a peak and subsequent dip, with total European VC investment in 2024 reported at approximately $45 billion, the valuation successes and funding depth remain significant.
This situation points to a structural change: funding has become more selective and focused on outcomes, moving away from broad capital flows. Investors, limited partners, and strategic collaborators are seeking evidence of product-market fit, regulatory advantages, and sustainable business models.
Market and language fragmentation, often seen as a European hurdle, can also be an asset when combined with specialized expertise clusters. Examples include cybersecurity hubs in Belgium, deep tech in the Nordics, cloud infrastructure in the Baltics, and education technology linked to diverse EU labor markets. These clusters are attracting venture capital, with founders not exclusively seeking opportunities in Silicon Valley.
Policy instruments and institutional backing are increasingly supporting European innovation. The European Union’s research and innovation framework programs, particularly Horizon Europe, are allocating significant funds to areas like digital transformation, strategic autonomy, and industrial competitiveness.
From 2021 to 2027, Horizon Europe serves as the EU’s primary funding program for research and innovation, with a budget of approximately €93.5 billion. This funding aims to enhance competitiveness, tackle climate and social issues, and support critical technologies ranging from AI to advanced manufacturing.
This support is crucial as initiatives previously considered niche, such as advanced sensors, ESG compliance tools, or dual-use civil and defense technologies, now align directly with the EU’s broader strategic innovation objectives.
Programs like Horizon Europe Cluster 4 – Digital, Industry and Space, along with related initiatives, unite public and private entities to address digital and green transitions. They achieve this by pooling resources and establishing clear routes from research to commercial application.
Consequently, the recent unicorn announcements appear to signify a phase transition rather than a mere anomaly.
What is the broader implication? Do these five new unicorns indicate a sustainable growth trend or merely a temporary fluctuation in enterprise valuations?
They likely represent both: a sign that Europe’s startup engine is driven by considered investment, practical applications, and fundamental problem-solving, while also posing a challenge to maintain this momentum for later-stage growth and successful exits.
Europe does not need to emulate Silicon Valley. Its path requires confidence in its unique values, disciplined capital, diverse innovation, and regulation that acts as an enabler rather than a restriction.
If this marks a significant period for European tech, its definition extends beyond impressive valuations. It is characterized by the wide array of problems being addressed and the strong commitment underpinning these solutions.
