Europe is home to twice as many climate tech startups as the US (30,000 vs. 14,300). However, limited access to VC funding is forcing these early-stage companies to seek capital from outside the continent, according to a new report released at the Munich Security Conference today.Venture financing in Europe averaged just 0.2% of GDP between 2013 and 2023, a fraction of the US average of 0.7%. While the continent is great at creating clean tech companies, its not so good at funding them.The authors of The Importance of Climate Tech for European Resilience report the World Fund, Kaya Partners, and Worthwhile Capital Partners fear this trend isnt just bad for business, but also leaves Europe exposed to geopolitical and economic shocks. Dependency on foreign powers for everything from solar panels to EVs is eroding Europes resilience, they said.They warn that Europe has lost the early advantage in climate tech R&D that it established during the 2010s. Germany provides a good example. Despite being a frontrunner in solar and wind capacity in the early 2000s, the country saw its progress stall after 2012 due to tariff and subsidy policies. As a result, annual installed renewable capacity peaked at 9.7GW in 2012 and remained below that level until 2022.Thanks to its leadership in climate tech innovation, Europe has a second chance to build leading industries and strengthen its resilience, said Danijel Vievi, World Fund general partner and co-author of the white paper. We shouldnt repeat the mistakes made in 2012, but capitalise on our opportunities.Register NowThe authors call for bold, long-term policy and investment shifts across four key areas: energy, food security, frontier technologies, and raw materials. They view defence as a unifying thread across these sectors.The papers key recommendations include upgrading the energy grid, boosting long-term energy storage, and backing frontier tech like AI, fusion, and quantum computing. It also calls for an increase in EU defence spending to at least 3% of GDP.Additionally, the report reiterates Mario Draghis call for 800bn in annual spending via public-private partnerships, regulatory streamlining, and expanded roles for institutions like the European Investment Bank.Combined, these actions could provide a clear and solid basis for policies that actively strengthen resilience by 2029, the report argues.The paper comes as world leaders gather at tense times in global politics, which are strengthening the case for European independence in venture financing.Disruption is upon us, said Bo Lidegaard, a partner at Kaya Partners and co-author of the white paper. Europe must embrace it and reignite the creativity, innovation, and entrepreneurship so deeply rooted with us. Story by Sin Geschwindt Sin is a climate and energy reporter at TNW. From nuclear fusion to escooters, he covers the length and breadth of Europe's clean tech ecos (show all) Sin is a climate and energy reporter at TNW. From nuclear fusion to escooters, he covers the length and breadth of Europe's clean tech ecosystem. He's happiest sourcing a scoop, investigating the impact of emerging technologies, and even putting them to the test. Sin has five years journalism experience and holds a dual degree in media and environmental science from the University of Cape Town, South Africa. Get the TNW newsletterGet the most important tech news in your inbox each week.Also tagged with