EU Tech Founders Unite to Battle Startup ‘Brain Drain’ to US

European tech founders are teaming to keep young startup talent from leaving the continent.

As the Financial Times (FT) reported Wednesday (March 12), the effort — dubbed Project Europe — is a 10 million euro ($10.9 million) fund that will offer 200,000 euros (or about $218,000) to help entrepreneurs aged 18-25 build tech startups.

“The world has made up its mind that Europe is not a place of innovation. That is wrong,” said Harry Stebbings, the London-based venture capitalist leading the project. “There is a doom loop around Europe and we need to change that. The brain drain to the U.S. is very real and it’s going to really damage the future of Europe unless something changes.”

As the FT notes, Project Europe is one of many efforts aimed at boosting entrepreneurship amid worries that European startups are losing ground to the U.S. and China, particularly on the artificial intelligence (AI) front.

Contributing to the project are a group of venture firms such as Stebbings’ 20VC, along with more than 125 tech founders from the region who will act as mentors. These include Tobias Lutke of Shopify, Sebastian Siemiatkowski of Klarna and Niklas Östberg of Delivery Hero.

“Bringing together more than 100 of Europe’s top founders under one mission highlights the power and impact of Project Europe in shaping the next generation,” Siemiatkowski told the FT. “We’re here to back young talent tackling the toughest technical challenges — with capital, mentorship and infrastructure.”

While tech investment in Europe began to flourish last year after a prolonged drought, the FT report notes that there’s concern about over-regulation hindering their growth.

That sentiment exists outside of Europe as well. Addressing the AI Summit in Paris last month, U.S. Vice President JD Vance warned that “excessive regulation of the AI sector could kill a transformative industry.”

The region is also in the midst of rising tech-related tensions with the U.S., which has accused European regulators of unfairly targeting American tech giants.

Last week saw reports that EU lawmakers had written to U.S. officials saying claims that the EU is using its digital competition laws to unfairly punish American companies were unfounded.

“Given the importance of our shared values in promoting fair competition and innovation, it is essential that we align our efforts to address the challenges posed by dominant digital platforms,” the lawmakers’ letter said, per a report by the Wall Street Journal.