“The United States innovates while Europe regulates (and China replicates).”
That’s the kind of narrative we’ve been hearing a lot lately, especially from across the Atlantic.
- A narrative that paints Europe as a continent of red tape, not rocket ships.
- One that suggests we’re better at reinventing bottle caps than building breakout tech companies.
Case in point: here’s a recent slide from U.S.-based VC firm UP.Partners in its latest global mobility report:
But is that really the full story?
We’ve been asking ourselves the same question at TNMT.
And sure, we’re biased. We’re rooted in Europe.
But maybe that’s exactly why it’s time we use our TNMT platform to take a closer look.
- Yes, Europe may have fallen short on producing Google-, Amazon-, or Meta-sized tech giants.
- But that doesn’t mean there’s no tech magic happening here, especially in the Travel and Mobility Tech space.
In fact, we’re seeing more and more home-grown startups quietly hitting serious commercial milestones, scaling aggressively, and solving real industry problems.
Because of this, we’re launching a new TNMT content series.
Over the next few months, we’ll spotlight several European Travel and Mobility Tech startups that prove innovation here is not only alive, but quite literally flying!
The first startup stories await you below.
(And no, it’s not about bottle caps.)
Europe is on the rise
Before we jump to our first European breakout story, a few more (data-driven) signals that Europe deserves our attention.
Turns out investors are starting to agree.
According to our in-house TNMT investment tracker, European Travel and Mobility Tech startups have (for the first time in over a decade) raised more VC funding than their U.S.-based peers in 2025 (at least up until the end of May).
This isn’t just a fluke.
- Even U.S. investors are shifting focus toward European disruptors.
- As of Q1 2025, roughly one-third of all VC euros invested in European startups (across all sectors) have come from U.S.-based investors, up from just 23% three years ago.
And there’s more.
Dealroom data shows that, with this backing, Travel and Mobility Tech has emerged as Europe’s second-most funded sector in Q1, trailing only Health Tech.
So what’s fueling this momentum?
Surprisingly, it’s not just the AI wave.
Dig deeper into the European VC landscape, and you’ll find a rising force: Deep Tech.
- In Q1 2025, nearly 30% of all VC investment in Europe has flowed into startups working on heavy-duty innovation, such as real-world hardware, complex engineering, advanced robotics, and breakthrough materials.
- So it’s less about apps, more about atoms.
This Deep-Tech movement reflects something Europe has long excelled at: industrial ingenuity and manufacturing depth.
And it’s this Deep-Tech focus that leads us to the first Travel and Mobility Tech startup we believe deserves the spotlight.
1. Europe’s SpaceX-in-the-making?
Our first standout company in this new series might not be entirely unknown to TNMT readers.
And to be clear: there’s no sponsorship involved–our selection is based purely on market signals.
After all, Isar Aerospace has made quite a few headlines this year.
But despite the buzz, it still doesn’t get the credit it deserves.
So let’s fix that.
Isar Aerospace is Europe’s boldest Space Tech bet and a potential SpaceX rival in the making. (Even if that’s still many rocket launches away.)
But let’s take it one step at a time.
For those not familiar, Isar Aerospace builds rockets for satellite launches.
The Munich-based startup (yep, Isar is the river running through the city) designs and manufactures its own launch vehicles, most notably the Spectrum rocket, to offer independent, cost-effective access to space for small- and medium-sized satellite operators.
Its edge?
- Full vertical integration and a commercial mindset.
- Unlike legacy space agencies or fragmented European competitors, Isar builds its own engines, systems, and infrastructure.
- That means faster iteration cycles and more competitive pricing.
It’s a European answer to SpaceX, but tailored for the booming small satellite market, as industries increasingly rely on satellite connectivity, Earth observation, and in-orbit data infrastructure.
Isar’s clients range from satellite startups and commercial operators to government agencies seeking sovereign-independent launch capacity, a concern that has grown sharply in the wake of the Ukraine war and wider geopolitical tensions.
From 30 seconds to 1 billion
Two major milestones have catapulted Isar Aerospace from Deep-Tech underdog to a serious Space Tech contender in 2025.
First, the company’s inaugural rocket launch in March.
- Yes, the flight lasted only 30 seconds before crashing back to Earth.
- Yes, German media were quick to label it a “failure.”
- But that misses the point entirely.
Because this was more than the first official test flight.
- It was the first-ever launch of a commercial space rocket from European soil, taking off from the Andøya Spaceport in Norway.
- A landmark moment for Isar, and Europe’s long-overdue ambitions in commercial spaceflight!
And while the rocket didn’t reach orbit, it did help launch something else: investor confidence.
Just two weeks ago, Isar Aerospace announced a new €150 million funding round, including backing from U.S.-based Eldridge Industries (yes, yet another sign of American VCs waking up to Europe’s Deep-Tech potential).
New unicorn spotting
While the company hasn’t confirmed it publicly, this round is likely to have pushed Isar’s valuation past the $1 billion USD mark.
Yep, a European unicorn in Space Tech. That’s rare air.
To put it into perspective:
- Only about 1% of VC-backed startups in Europe ever reach unicorn status. That means Isar is literally a 1-in-100 exception.
- For comparison, the unicorn hit rate in the U.S. is closer to 2%, which is twice as high, making Europe an even tougher playing field to break through.
Bottom line?
Even in a post-ZIRP (zero interest rate policy) world of cautious capital, Isar Aerospace is attracting major belief and backing.
And that’s exactly the kind of signal we look for in a TNMT standout.
The bigger picture
Let’s be clear: a fresh round of VC cash and a unicorn badge don’t guarantee a smooth journey to orbit.
- SpaceX burned through hundreds of millions and three failed launches before its first successful takeoff in 2008.
- And Isar is essentially 17 years behind the market leader, which, let’s be honest, is a serious gap.
But here’s the upside: Isar benefits from a far more mature ecosystem of suppliers, talent, and downstream applications.
And momentum is clearly building.
As we’ve covered before, the space hype and the rise of commercial space infrastructure are closely tied to macroeconomic forces, including global connectivity and geopolitical self-reliance.
Europe can’t afford to sit this one out.
Isar’s emergence and the broader growth in European Space-Tech funding signal a shift:
- Europe isn’t just building rockets.
- It’s building resilience!
Now, Isar Aerospace may be reaching for the stars, but it’s far from the only European startup turning heads in Travel and Mobility Tech.
In fact, many of the most exciting breakthroughs are happening much closer to home, right on the runway, in control towers, hangars, and fuel tanks.
So in this next section, we’re shifting our focus from space to sky.
Because Europe’s not just launching rockets. It’s quietly building the future of flight.
2. Aviation Tech takes flight
So what’s driving the next wave of European Travel and Mobility Tech innovation beyond the headline-grabbing rockets?
To find out, we (once again) turned to our in-house TNMT investment tracker and broke down VC activity by sub-sector, comparing full-year funding volumes from 2019 to 2024.
The result?
One category is clearly pulling ahead.
Aviation Tech, so the segment focused on innovation in and around the aircraft itself, has experienced the sharpest growth in funding volume over the past five years.
But what exactly falls under Aviation Tech?
In our definition, this category covers a broad spectrum of startups working on the operational, technical, and infrastructure layers of aviation. Think:
- Airport innovation (e.g., automation, turnaround tech, and robotics, as covered in our previous deep dive on airport operations)
- New airline operators (particularly in charter, private, or low-cost segments)
- Next-gen aircraft manufacturers (including suppliers for new aircraft designs and electric aircraft developers)
- Digital tools for aircraft operations, such as digital twins, drone-based inspections, and AI-powered MRO solutions
In short: The kind of real-world, often complex tech that transforms how aircraft are built, flown, and maintained.
Aviation Tech vs. Online Travel
Aviation Tech’s momentum becomes even more striking when compared to another high-profile corner of the industry: Online Travel.
- Over the past year, Online Travel has been heavily in the spotlight, largely thanks to the GenAI boom and the promise of AI-powered disruption across the booking journey.
- From chatbot interfaces to personalized trip planning, the hype around reinventing how people search, plan, and book travel has been hard to miss.
And yet, all that buzz hasn’t translated into funding success.
In fact, few Online Travel startups have managed to raise meaningful capital in 2025.
The reason?
- Investors are still grappling with uncertainty around how, and when, AI will reshape the booking experience.
- Will traditional OTAs and airline.com websites get replaced by GenAI interfaces like ChatGPT?
- Will travelers really trust a chatbot to plan their entire trip?
Until those questions are clearer, capital is staying cautious.
Meanwhile, European Aviation Tech startups are cutting through the noise.
In just the first half of 2025, they’ve raised 4x more funding than their Online Travel counterparts.
It’s a signal that the market is shifting its focus: away from flashy AI concepts and toward grounded, operational innovation.
The green engine driving Aviation Tech
So, the obvious next question: What exactly is attracting all this capital within Aviation Tech?
To find out, we broke the category down (again) into its six main sub-segments.
And once again, one theme stands out, and it’s not new, but it’s gaining ongoing traction: sustainability.
- European startups focused on making aviation more sustainable have steadily grown their share of overall Aviation Tech funding.
- Back in 2019, they accounted for just around 10% of sector funding.
- In 2025, they’re now responsible for more than a third, even after a slight dip from last year’s peak of 40%.
Some have claimed the climate-tech hype is fading.
But in European Aviation Tech, that narrative doesn’t hold.
If anything, the opposite is true: sustainable aviation innovation is becoming a core pillar of the ecosystem.
And that brings us to today’s standout startup(s): companies putting sustainability at the center of aviation’s future.
Meet the startups fueling aviation’s green transition
Two names worth remembering in the push for cleaner skies: Velocys and SkyNRG.
Velocys is a UK-based technology licensor spun out of Oxford University back in 2001.
It has quietly become a key enabler in the SAF value chain.
- While not a fuel producer itself, Velocys licenses proprietary tech that transforms household and forestry waste into Sustainable Aviation Fuel.
- After more than two decades of development, the company is now scaling fast: it has raised over $100 million to date, including $40 million in 2024 alone, and just closed another (undisclosed) growth equity round in June 2025 to push its technology into large-scale commercial deployment.
Meanwhile, SkyNRG, headquartered in Amsterdam, is taking a more integrated approach.
- As both a SAF producer and strategic advisor, the company is building out physical production capacity while also partnering with airlines to accelerate adoption.
- Its biggest milestone yet: a $300 million funding round in 2025 to build SAF plants in the Netherlands, Sweden, and the United States.
- Already a long-time partner to KLM, SkyNRG is fast becoming a heavyweight in the global SAF supply race.
Together, Velocys and SkyNRG represent two complementary approaches: one focused on core tech, the other on infrastructure and distribution.
But both are united by a shared goal: making SAF commercially viable and widely available.
And that matters.
Despite all the experimentation in green aviation (think electric and hydrogen flying), SAF remains the only technically viable solution today to mitigate aviation’s CO₂ output at scale.
The problem?
- Supply is nowhere near where it needs to be.
- Today, SAF still makes up less than 1% of global jet fuel use.
That’s where Europe steps in.
Unlike other regions, Europe’s push for sustainability isn’t just culturally driven (though public sentiment does skew greener than in markets like the U.S.)
It’s also policy-powered.
The EU’s SAF mandate requires a 2% SAF blend by the end of 2025, rising to 70% by 2050.
And it’s already showing up in the data:
- In 2024, 63% of global SAF volumes were used by European carriers.
- North American carriers followed with 26%, while Asian carriers trailed at just 2%.
In short: while others are debating (or ignoring) the long-term future of a more sustainable aviation, Europe is doubling down on the only scalable solution available today, and building the ecosystem to make it work.
What’s next?
Curious which other European startups are quietly reshaping the travel and mobility space?
Then stay tuned!
