Europe invests far less than the United States in artificial intelligence, but it is establishing itself as a major hub for AI applications. That is the conclusion of a new report by the consulting firms McKinsey and Boardwave, reported by Fintechnews Switzerland. It is an analysis by consulting firms, based on data gathered from June to August 2026 and on expert interviews, not an official finding.
A marked investment gap
The report's starting point is a venture capital shortfall. Between January 2025 and June 2026, Europe captured only 10% of the €835 billion raised worldwide, compared with 71% for North America and 16% for Asia. In the so-called foundation layer, that of platforms and infrastructure, European funding amounts to only 4% of the US level. Capital there is concentrated on the major American labs: Anthropic, OpenAI and xAI raised €229 billion in the first half of 2026, or 85% of US funding for this layer.
Catching up is happening in applications
The picture changes in the application layer, where young European companies are developing specialized software that can run within companies' existing systems and automate complex tasks. In 2018, European funding for AI applications amounted to only 11% of the US level; in the first half of 2026, it reached 44%, or €6.8 billion. That amount equals the total for 2024 and, according to the report, puts 2026 on track to exceed the €8.1 billion raised over the whole of 2025.
So-called vertical AI, specific to a given sector, is growing particularly fast: in the first half of 2026, European start-ups in this segment captured the equivalent of 67% of the funds raised by their American counterparts, compared with 9% in 2018. The amounts remain a fraction of global AI funding, but the report sees in them a positive structural shift, coinciding with the emergence of players such as Helsing, Legora, Lovable and Wayve. Founded on average only five years ago, these companies already rank among the top 100 European tech companies by valuation.
Six sectors account for this investment: industry, energy and climate; defense and security; transport, mobility and logistics; law and compliance; health and life sciences; financial services and insurance. The report attributes this to the weight of large established groups, the research ecosystems linked to them and strict regulation. Among the largest funding rounds in 2025 and the first half of 2026 were Helsing (€1.7 billion, 21% of defense and security funding) and Wayve (around €1.1 billion, 17% of the transport, mobility and logistics segment).
Talent, research and large companies
Three drivers stand out. First, talent: according to the think tank Europe Interface, 2025 saw, for the first time in years, a net flow of tech and AI professionals from the United States to Europe. According to McKinsey, the transatlantic pay gap is narrowing: leading European labs are offering compensation of €300,000 to €500,000 for top research and engineering profiles.
Second, research: since 2015, university spin-offs have accounted for 33% of new deeptech start-ups in Europe, according to a 2026 report by Dealroom, Lake Star and Walden Catalyst. Europe is home to 30% of the top universities in deeptech disciplines, including Oxford, Cambridge and ETH Zurich.
Finally, large companies, which open up their workflows, proprietary data and distribution channels to start-ups. According to McKinsey, in the first half of 2026, the value of European funding rounds in AI applications involving at least one corporate investor reached 39% of the US level, compared with 14% in 2018. Public authorities support these collaborations: the EU AI Champions Initiative, launched in 2025, presented 18 partnerships between large groups and scale-ups, including Allianz with Parloa and Deutsche Telekom with PhysicsX, unlocking €1 billion in co-investment.
What this may mean for Swiss companies
The report, as presented by Fintechnews Switzerland, does not specifically address Switzerland, apart from the mention of ETH Zurich. It does, however, offer a framework for Swiss companies adopting AI: value is increasingly created in tools specialized by line of business, built in close contact with the processes and data of user companies. The sectors cited include finance, health and industry. One question remains open: will the country's companies want to play this partner role, opening up their workflows and data to young companies, as the report describes at the European level?
Sources: "Europe Emerges as Global Hub for AI Applications," Fintechnews Switzerland, October 12, 2026, based on a report by McKinsey and Boardwave.
