Sonali De Rycker, a general partner at Accel and one of Europe’s most influential ventop capitalists, is Bullish about the prospects of the continent in AI. But she is wary of the regulations of the regulations that could hammer his momentum.
During a Techcrunch StrictlyVC -evening in London in London earlier this week, De Rycker thought about the place of Europe in the global AI race, with optimism in balance with realism. “We have all the pieces,” she told them collected for the event. “We have the entrepreneurs, we have the ambition, we have the schools, we have the capital and we have the talent.” The only thing that is missing, she argued, is the possibility to ‘unleash’ that potential to scale.
The obstacle? The complex regulatory landscape of Europe and, in part, the groundbreaking but controversial artificial intelligence law.
De Rycker acknowledged that regulations play a role, especially in risky sectors such as health care and finance. Yet she said that she is worried that the wide range of the AI act and possibly stifling fines can scare up innovation when European startups need space to repeat and grow.
“There is a real chance to ensure that we go fast and address what we are capable of,” she said. “The problem is that we are also confronted with headwind in regulations.”
The AI Act, which imposes strict rules for applications that are considered ‘high risk’, from credit scores to medical imaging, has raised red flags from investors such as the Rycker. Although the goals of ethical AI and consumer protection are commendable, she fears that it can be poured too wide, possibly discourage an early stage experiments and entrepreneurship.
That urgency is reinforced by shifting geopolitics. With the American support for Europe’s defense and economic autonomy that are declining under the current Trump government, De Rycker sees this moment as a decisive thing for the EU.
“Now that Europe is being left to ward off [for itself] In several ways, “she said,” we must be self -sufficient, we must be sovereign. ‘
That means that the full potential of Europe unlocks. De Rycker points to efforts such as the ’28th regime’, a framework aimed at creating a single set of rules for companies in the EU, as crucial for creating a more united, startup-friendly region. Currently, the mix of labor laws, licenses and business structures in the countries create friction and the progress is creating.
“If we were really one region, the power that you could unleash would be incredible,” she said. “We would not have the same conversations about Europe that remains in technology.”
According to De Rycker, Europe is slowly catching up, not only in innovation, but also in the embrace of risk and experiments. Cities such as Zurich, Munich, Paris and London are starting to generate their own self -sophisticated ecosystems thanks to academic institutions of Top class and a growing basis of experienced founders.
For his part, Accel has invested in more than 70 cities in Europe and Israel, making the Rycker a chair in the front row on the fragmented but flowering technical landscape of the continent. Nevertheless, she noticed a stark contrast to the US on Tuesday evening when it comes to adoption. “We see much more tendency for customers to experiment with AI in the US,” she said. “They spend money on this type of speculative companies at an early stage. That flywheel continues.”
Accel’s strategy reflects this reality. Although the company has not supported any of the most important fundamental AI model companies such as OpenAi or Anthropic, it has focused on the application layer instead. “We feel very comfortable with the application layer,” said De Rycker. “These fundamental models are capital intensive and don’t really look like companies with a company.”
Examples of promising bets include Synthesia, a platform for generating video things used in Enterprise Training and Speak, an app for learning languages that recently jumped to a valuation of $ 1 billion. De Rycker (who has avoided questions about the reported interviews of Accel Another big name in AI), sees these as early examples of how AI can create completely new behavior and business models.
“We are expanding the total addressable markets at a rate that we have never seen before,” she said. “It feels like the early days of mobile. Doordash and Uber were not only mobilized websites. They were brand new paradigms.”
Ultimately, De Rycker regards this moment as a challenge and a one -off chance. If Europe leans too much for the regulation, this risks stifling the innovation that it could help to compete worldwide – not only in AI, but throughout the technical spectrum.
“We’re in a super cycle,” she said. “These cycles don’t come often and we can’t afford to be leashed.”
With geopolitical uncertainty, and the US is increasingly looking inside, Europe has little choice than to bet on its own. If it can find the right balance, De Rycker believes that it has everything it needs to lead.
Asked by a participant what EU founders can do to be more competitive with their American counterparts, she did not hesitate. ‘I think they are [competitive]”She said, with reference to companies Accel supported, including Supercell and Spotify.” These founders look no different. “
You can catch the full conversation with De Rycker here: