Niklas Zennström, co-founder of Skype and prominent European tech investor, believes European startups can thrive in AI despite the significant funding gap with US competitors. In an interview with the Financial Times, as reported by Tim Bradshaw, Zennström explained that European companies can succeed by developing applications on top of established AI platforms from companies like OpenAI and Google.
The funding disparity between US and European AI ventures is substantial, with US investment in generative AI reaching $48 billion in 2023-2024, compared to just $9 billion in Europe and Israel combined, according to Accel’s research. Despite this gap, Zennström argues that success in AI doesn’t require every company to develop its own large language model.
Zennström’s venture firm Atomico has already invested in specialized European AI startups, including Danish healthcare assistant maker Corti and German translation tool DeepL. He compares the situation to cloud computing, where numerous successful businesses have been built on top of a few dominant cloud providers.
However, he acknowledges that creating competitive general-purpose AI models remains challenging for European companies, as it requires substantial funding, data access, and distribution capabilities – advantages currently held by major US tech companies.