Europe’s not-so-dry January: Unicorns and a new tech identity

Every January, millions take on Dry January, a ritual of restraint and resetting after the holiday season. If that’s the benchmark for kicking off the year with moderation, Europe’s startup ecosystem clearly didn’t get the memo. 

In the opening weeks of 2026, the region saw five startups join the unicorn club, crossing the $1 billion valuation mark across sectors as varied as cybersecurity, cloud optimisation, defence tech, ESG software, and education technology. 

January was anything but dry for European companies. This burst of activity signals more than a funding spike; it invites a deeper look at what Europe’s innovation identity looks like today. Across the continent, there’s a stronger sense that Europe can produce and scale world-class tech companies in its own right, rather than just nurture later-stage spin-offs or see them acquired by U.S. firms. 

While the United States still leads in overall startup volume and ecosystem strength, Europe’s recent momentum shows its innovation landscape is maturing and gaining confidence on the global stage.

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Europe was already home to over 217 unicorns by late 2025, spread across fintech, AI, enterprise software, and other domains. That’s a milestone for a region whose venture culture has historically leaned toward caution.

The new unicorns 

• Aikido Security (Belgium)
  Aikido jumped into unicorn territory with a $60 million Series B led by DST Global, valuing the cybersecurity platform at around $1 billion. Its tools help developers unify security across the software development lifecycle, and the company reports strong revenue and customer growth. 
• Cast AI (Lithuania / Global)
  Lithuania’s fifth unicorn after a strategic investment pushed its valuation past $1 billion. Cast AI builds tech to optimise cloud infrastructure and AI workload deployment, helping enterprises reduce GPU costs and complexity. 
• Harmattan AI (France)
  A French defence software startup that reached a valuation of roughly $1.4 billion after a $200 million Series B round. It develops mission systems and autonomous capabilities for defence applications, securing early interest from industry partners. 
• Osapiens (Germany)
  Osapiens crossed the unicorn threshold at over $1.1 billion following a $100 million Series C led by Decarbonization Partners. Its platform helps large enterprises with ESG data, sustainability reporting, and compliance, a space driven by regulatory demand. 
• Preply (Ukraine / Global)
  The edtech marketplace, valued at around $1.2 billion after a $150 million Series D, connects learners with tutors worldwide. Its human-led, AI-improved approach has scaled globally while maintaining a strong operational footprint tied to Ukrainian founders and teams. 

More than a unicorn rush

What’s notable isn’t simply the number of new billion-dollar companies, but their variety. Gone are the days when a single sector, often generative AI, defined European unicorn trajectories. Here we see cybersecurity, cloud optimisation, defence-oriented software, sustainability data, and education marketplaces all earning top valuations and investor backing. 

The broader context matters. In 2025, deep-tech and university spinouts, including companies in aerospace, robotics, materials, sensors, and health sciences, saw near record levels of funding, and many achieved significant valuation or revenue milestones. 

This goes hand in hand with a narrative that’s become increasingly clear: European capital is being more deliberate than exuberant. Rather than inflate every trend label, investors are writing checks where traction, revenue models, and regulatory demand converge. That’s why platforms helping companies with compliance and ESG reporting, or infrastructure for cloud efficiency, are winning attention alongside defence-tech innovators.

Europe’s tech ecosystem has matured, even if it still faces hurdles. Venture funding peaked in recent years and then dipped; for example, total European VC investment in 2024 was reported to be around $45 billion, down from earlier highs. Yet the valuation achievements and funding depth remain meaningful. 

This apparent paradox highlights a structural shift: rather than broad flows of unfettered capital, funding is now more selective and outcome-oriented. Investors, LPs, and strategic partners are looking for proof of product-market fit, regulatory differentiation, and defensible business models.

Fragmentation across markets and languages, long considered a European challenge, can also be a strength when paired with clusters of domain expertise, cybersecurity hubs in Belgium, deep tech in the Nordics, cloud infrastructure in the Baltics, and education technology with strong ties to diverse EU labour markets. Observers have noted that these clusters are attracting venture dollars, even if not every founder heads straight for the Bay Area. 

Policy tools and institutional support are increasingly part of the backdrop for European innovation. The European Union’s research and innovation framework programmes, most notably Horizon Europe, are directing substantial resources toward areas such as digital transformation, strategic autonomy, and industrial competitiveness. 

For 2021–2027, Horizon Europe is the EU’s flagship funding programme for research and innovation, with an overall budget of around €93.5 billion allocated to boost competitiveness, address climate and social challenges, and support key technologies from AI to advanced manufacturing. 

This support matters because initiatives that might once have felt niche, advanced sensors, ESG compliance tools, or technologies with both civil and defence applications, now align clearly with broader strategic goals set out in the EU’s innovation plans. 

Calls under Horizon Europe Cluster 4 – Digital, Industry and Space, and related programmes bring together public and private partners to tackle digital and green transitions, pooling resources and creating coherent pathways from research to commercial deployment.

That’s why this month’s unicorn news feels less like a fluke and more like a phase transition.

So what does it all mean? Are these five new unicorns signs of a sustainable upswing or just a temporary blip in enterprise valuations?

They’re arguably both: an indicator that Europe’s startup engine still runs on thoughtful investment, real use cases, and foundational problems, and a challenge to continue scaling that momentum into later-stage growth and exits.

Europe doesn’t need to be Silicon Valley. It never really did. What it needs is confidence in its own values, disciplined capital, diverse innovation, and regulation as an enabler, not a constraint.

If this is Europe’s tech moment, it’s not marked by headline-grabbing valuations alone. It’s defined by the breadth of problems being solved and the depth of conviction behind those solutions.