While deep tech and AI-driven startups continue to show potential, regulatory roadblocks and economic uncertainty cast a shadow over the market in 2025. Presto Tech Horizons partners Vojta Rocek and Lucie Bresova share their insights on what lies ahead in 2025, from investment shifts to the evolving startup landscape in CEE.
Regulations threaten European deep tech
One of the biggest challenges facing European startups remains the regulatory environment. Rocek warns that unless EU policies change, stagnation in technology and innovation will make Europe increasingly irrelevant. While some initiatives are emerging, he remains skeptical.
“If EU policies don’t change – which, unfortunately, seems to be the default – it will lead to stagnation of tech and innovation, making Europe increasingly less relevant. For the sake of European competitiveness and resilience, I truly hope I’m proven wrong,” Rocek explains.
Bresova echoes this sentiment, noting that bureaucracy is slowing down the adoption of cutting-edge AI and automation. The challenge? Breaking free from EU bureaucracy so founders can integrate new AI tools faster than a Slack update. Without reforms, European startups risk losing ground to more agile ecosystems in the U.S. and Asia.
Fundraising in 2025: Stability or uncertainty?
After a turbulent few years, 2025 is likely to continue on a linear path rather than bringing major disruptions. Rocek suggests that if the U.S. economy experiences a resurgence, Europe could see positive effects, but 2025 might be too soon to observe significant changes.
Valuations are normalizing across the CEE region, but this isn’t necessarily a bad thing. Bresova describes it as a market reset rather than a downturn, emphasizing that European investors need to look beyond national economic instability and focus on innovative technologies that can drive long-term growth.
“European macros are very unstable, a lot will be impacted by how France and Germany handle their national priorities and challenges. European investors must rise above these national topics, as only innovative technologies can bring the much needed edge and new capital revival,” Bresova points out.
The rise of deep tech and defense
Presto VC is adjusting its investment priorities, shifting toward deep tech, resilience tech, and defense-focused startups. B2B SaaS is slowly dying and will continue to decline for years to come, Rocek states. Instead, the future is going to develop at the intersection of hardware and software, particularly in sectors like robotics, advanced manufacturing, and cybersecurity.
“The future lies in the combination of hardware and software, deep tech and resilience tech, and startups that bring these elements together. AI is already eliminating jobs left and right, and this trend will only accelerate,” Rocek adds.
Bresova sees ‘invisible AI’ powering robotics, healthcare analytics, and next-gen cybersecurity as a key investment theme for 2025. She highlights that while AI and defense tech have already shaken up the ecosystem, they will only gain traction given the current geopolitical climate.
Challenges and opportunities
Despite economic uncertainties, the CEE region remains a strong player due to its technical talent and ability to innovate on lean budgets. However, securing funding might become harder, as investors prioritize proof of viability over pure growth.
Bresova advises founders to focus on essentials: What does the customer really need, and what are they willing to carve out money for in their budget? With tighter belts across industries, startups must prove their value through tangible business models.
The biggest lesson from 2024? AI hype alone is not enough. Slapping ‘AI’ on a pitch deck isn’t going to cut it anymore; we need AI that actually creates or saves money, Bresova emphasizes. Investors will be looking for AI-driven solutions that deliver measurable impact rather than just buzzwords.
Rocek also urges European founders to make their voices heard in policy discussions: Communicate your needs clearly, highlight your economic potential and contributions.
“You are the main reason why this continent is currently headed for an economic death over the next 20 years. Recognize the problem and act fast to fix it, or step aside,” Rocek sends a stark warning to EU policymakers.
