One of Europe’s major VC firms is looking to invest some $1.3bn (€1.2bn) into the budding business of European tech entrepreneurs.

The total sums, Balderton Capital revealed, include a $615mn (€563mn) early-stage fund and a $685mn (€626.8mn) “growth” fund, to focus on supporting more mature firms.

The venture capitalist is already funding a roster of well-known companies including Revolut, GoCardless and Dream Game, while projects it has invested in and moved on from include Darktrace and Depop.

Balderton’s global investors include a major US state pension fund and British Patient Capital, the UK’s largest domestic investor in venture and venture growth opportunities.

“At Balderton, we believe the best way to change the world is to build a business – and that many of these world-changing businesses will be built in Europe,” said Balderton’s managing partner Bernard Liautaud, in a statement issued on Monday.

“As a firm, our mission is simple: to be the partner of choice to the founders starting and growing those European technology companies. These new funds put us in a position to do just that.”

According to Dealroom, European VC investment came in at $15.5bn (€14.2bn) in the second quarter of 2024. That’s lower than the totals recorded during the pandemic boom funding years, although higher than pre-covid levels.

Leading segments for the year so far include electric mobility and hydrogen projects – although AI comes out on top – snatching 18% of all European VC funding.

When speaking recently to the Financial Times, Balderton’s Bernard Liautaud nonetheless expressed caution around pouring money into AI.

“We haven’t been convinced that [the underlying AI infrastructure] is necessarily the best place to get the best returns, because of the amount of capital required to be a great company,” Liautaud said.

He suggested that start-ups could nonetheless build upon AI infrastructure developed by big players such as Microsoft, Google and Amazon.

Liautaud also explained that companies now need to be much larger to successfully launch an IPO, meaning that mergers and acquisitions are crucial for VC funds to be able to withdraw their capital.