Spanish VCs weigh in – What 2025 means for Spain’s growing startup ecosystem

Spain's startup ecosystem is experiencing significant growth, with venture capital firms closing new funds and expanding their investment focus. This trend highlights the increasing maturity and potential of the Spanish market, drawing attention to emerging hubs beyond the traditional centers of Madrid and Barcelona. This expansion is indicative of a broader shift in the European digital landscape, with regional ecosystems gaining prominence. Armilar Venture Partners, with a €120 million fund, is actively targeting DeepTech and digital transformation ventures across Spain and Portugal. The firm focuses on Series A opportunities, investing in B2B startups with high technological content. Their investment thesis covers various sectors, including AI, cybersecurity, software development, infrastructure, FinTech, and HealthTech, showcasing the breadth of opportunities. The evolving startup scene in Spain is seeing entrepreneurship expand beyond Madrid and Barcelona, with cities like Valencia, Málaga, and Bilbao emerging as key players. Factors such as workplace flexibility and competition for technical talent are contributing to this shift. This decentralization could lead to a more balanced distribution of innovation and economic growth across the country, fostering a more robust digital ecosystem. 4Founders Capital closed its third fund at €70 million, exceeding its initial target, and has already made five investments. The firm emphasizes that their investment decisions are driven by the founding team's skills and attitude, rather than the location of the startup. This approach underscores the potential for innovation to emerge from anywhere, a key aspect of Spain's evolving digital economy.
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