Europe has no shortage of genius. From AI breakthroughs in Paris to advanced materials in Dresden and fusion hardware in the UK, the continent continually demonstrates that scientific imagination is not its problem. And yet, for all this intellectual firepower, too many deep tech ventures stall in the same bleak middle zone that treacherous space between functional prototypes and absolute commercial scale. Founders call it the “valley of death.” Policymakers call it a scaling gap. But in practice, it’s a slow bleed of time, capital and talent until only a handful survive.
The European Economic and Social Committee (EESC) recently captured the sentiment bluntly, Europe doesn’t struggle to create start-ups, it struggles to keep them. The question isn’t whether deep tech can originate here. It’s whether it can grow here. And right now, the evidence suggests otherwise.
The Regulatory Maze That Punishes Speed
Ask any founder building hardware, biotech or frontier AI what slows them down, and the answer lands with weary predictability, regulation. Flash Eurobarometer 559 provides numbers to back up the frustration. More than 70% of start-ups cite administrative burden as their primary scaling obstacle, and nearly two-thirds say regulatory frameworks are too slow for modern innovation.
But the real issue isn’t that rules exist, it’s that they aren’t designed for the tempo of deep tech. A biotech start-up may wait months for approvals that competitors in the US or Singapore receive in weeks. Quantum and photonics companies face different certification standards across member states, turning the “single market” into 27 versions of the same test. Meanwhile, founders spend more time explaining their work to compliance officers than to customers.
The Funding Cliff No One Wants to Admit
Europe excels at funding ideas and not companies. Public money through Horizon Europe, EIC Pathfinder, and national grants flows generously at the research stage. It’s why Europe leads in publications and prototypes. But when a start-up must transition from lab-scale to industrial scale, the money disappears almost overnight.
This is the heart of the valley of death because the continent lacks a reliable pathway from a €2M seed round to the €20–50M necessary for pilots, manufacturing, or clinical validation. American and Asian investors, accustomed to underwriting long-term technology bets, fill this vacuum. And when they do, the gravitational pull toward Boston, Silicon Valley or Shenzhen begins.
Founders don’t relocate because they want to. They relocate because Europe won’t finance the stage that matters most.
The Talent Squeeze That Turns Growth Into Guesswork
Deep tech relies on rare skills, such as those of computational chemists, fusion physicists, roboticists, and synthetic biologists. Talent defines the upper limit of any deep tech venture. And Europe’s limits are too low. Europe produces excellent scientists, but not enough of them, and the visa processes for importing additional talent remain notoriously slow. According to recent EU data, 43% of growth-focused SMEs struggle to hire, and the competition for specialised profiles is even more brutal.
For a founder, this creates a cruel paradox. Your company grows only when your team does, but building the team requires a labour system that moves as fast as your technology. Instead, hiring cycles span across quarters, and promising candidates opt for ecosystems where mobility, compensation, and career velocity align more closely with their ambitions.
The Storytelling Gap Investors Notice Immediately
There is one more barrier, softer but equally destructive. European founders, shaped by academia and grant culture, are trained to speak in caveats. They pitch with scientific precision instead of market conviction. Meanwhile, US founders stride into investor meetings with declarative verbs, near-future inevitabilities, and story arcs designed to inspire, not merely inform.
This creates a perception gap that penalises European founders before the technology has even been evaluated. Investors back confidence. They fund teams that project category leadership, not cautious competence. As deep tech strategist Adi Barel notes, “You can build something extraordinary, but without the right story, you will still be invisible.”
Infrastructure Inequality and the Myth of the Single Market
Even when a startup secures capital and talent, another obstacle emerges: access to infrastructure. Europe’s research excellence conceals a patchwork reality, where HPC centres are concentrated in specific regions, biofoundries are located in a few cities, testing facilities are unevenly scattered, and pilot-scale environments remain inaccessible to early-stage companies.
Despite the rhetoric of a seamless single market, 70% of SMEs still operate only in their home country. For deep tech, this is suffocating. A photonics company shouldn’t have to fly halfway across Europe for lab time. A biotech team shouldn’t battle national regulatory differences for identical wet-lab processes. A robotics start-up shouldn’t need three separate certifications for the same hardware.
What Europe Must Fix
The solutions are not mysterious; they’ve been discussed for a decade. But the difference now is urgency. Europe needs to act swiftly and decisively to address the regulatory, funding, talent, and infrastructure barriers that are hindering the growth of deep tech startups.
Europe needs regulation that keeps pace with reality, including fast-track approvals and mutual recognition across member states. It requires capital that supports scaling, such as late-stage funds, blended financing, and a capital markets union that enables institutional money to invest in deep tech with confidence. It needs a talent strategy with high-speed visas, cross-border labour flexibility, and STEM programmes aligned with real industrial needs. It needs to professionalise founder storytelling, embedding investor readiness into every accelerator, grant programme and university spinout office. And above all, it requires shared infrastructure, including pilot plants, AI compute, biofoundries, and robotics testbeds that turn good ideas into real industries. These are not nice-to-haves. They are the cost of competing in a world where deep tech determines geopolitical leverage.
Conclusion
Europe has everything it needs to lead the next era of deep tech: the science, the researchers, the universities, and the raw creativity. What it lacks is the terrain between breakthrough and scale. The valley of death is not a natural formation; it is a man-made gap built from slow regulation, fragmented markets, timid finance, and cultural habits that reward caution over conviction. But with the right reforms, Europe can overcome these barriers and emerge as a global leader in deep tech innovation. Founders can only build so much with brilliance alone. The rest requires an ecosystem built for speed, ambition and scale.
So, the question is now unavoidable, will Europe re-engineer the system around its deep tech founders or continue watching its greatest innovations bloom everywhere except at home?
