Paris surpasses London as the leading European tech hub
Paris has ascended to the position of Europe's chief tech hub, surpassing London for the first time, prompting concerns over the city's competitiveness within a crucial sector. The French capital made an appearance in the top five global tech ecosystems, according to Dealroom's 2025 Global Tech Ecosystem Index, overtaking London's consistent dominance.
Over the past few years, London-based tech firms have raised more venture capital, yet experienced a lesser increase in enterprise value, the report disclosed. In comparison, Paris-based tech firms saw their total enterprise value more than double during the same time frame, thereby outperforming their London counterparts.
Paris' consequential rise can be attributed to the burgeoning AI sector, which is demonstrating significant potential. A substantial proportion of the city's $7.8 billion funding in 2024 was allocated to AI startups, with notable investments in Mistral AI, Poolside, and Electra.
On the other hand, London recently faced a couple of setbacks. One of its prominent AI unicorns went bankrupt, while London-listed Deliveroo agreed to a takeover by its larger American rival Doordash. Even fintech giant Revolut, founded in London, selected Paris as its base for continental European expansion.
These developments have led to concerns regarding London's ability to maintain its hold on technology companies. Mark Pearson, CEO of Fuel Ventures, commented, "The acquisition of Deliveroo is yet another painful example of a British success story being purchased by a US giant. It underscores that the UK is struggling to retain its tech champions."
Despite this, London continues its dominance in AI investment, with startups raising £2.4 billion in 2024, surpassing Paris and Munich. Optimism persists in the deep tech and life sciences sectors, with BioNTech pledging £1 billion to a ten-year expansion in the UK, including a new AI hub in London and research space in Cambridge.
In summary, the rise of Paris as a significant tech hub is primarily due to the speed of growth in startup valuations, focused AI investment, efficient capital utilization, and a strengthening ecosystem. The challenges faced by London's tech sector, including setbacks and questionable competitiveness, stand in contrast to these positive factors.
The burgeoning AI sector in Paris, evident in the significant investment in AI startups like Mistral AI, Poolside, and Electra, has greatly contributed to Paris' rise as a notable tech hub. On the other hand, London's tech sector faces concerns, such as the exodus of fintech giant Revolut to Paris for continental expansion and the acquisition of prominent AI unicorns by foreign rivals, potentially affecting its ability to retain tech champions.
