Amid this challenging landscape, however, there was a cause for optimism with impressive raises for UK companies including Wayve, as well as other growth stories on the continent such as the whopping Series B funding round for Paris-based Mistral and Klarna’s planned IPO.

To establish the outlook for tech startup founders in the new year, we spoke to experts investing in and running early-stage technology companies to gather their predictions and advice for founders to make 2025 a success.

Louis Dussart, VP, Europe, RTP Global

While 2024 skewed towards AI, 2025 will see a rebalance in VC funding. From climate tech to AI’s application layer to fintech, we'll see greater interest in the startups that were, perhaps, overshadowed by the 'red-hot' AI companies that received the largest amounts of funding in 2024. 

2021's tech bull market has also set the foundations for 2025 to be a year of tech maturity. Right now, I’m seeing more optimised supply chains, better products, and clearer paths to long-term profitability. This is great news for founders; there's a real opportunity for those who capitalise on this optimism and ditch the recessionary instinct to downsize goals and objectives.

My top piece of advice for founders headed into 2025 is to stay firmly rooted in your value proposition. Focus on building something vastly superior to anything else available on the market today. Guided by this conviction, startups are in a good position to limit risk and build a category-defining solution.

Dr Andrea Cullen, CEO and Co-Founder, CAPSLOCK

It has been a challenging year in cyber security , as 74% of cyber professionals say the threat landscape is the worst they have seen in five years. Moving into 2025, optimism, resilience and flexibility will be critical qualities for founders and their cyber security teams, particularly as we see the introduction of the ‘Cybersecurity and Resilience Bill’. The impact of this bill will be similar to that of GDPR, and leaders will need flexibility to work around changing demands around reporting and infrastructure requirements.

To improve the resilience of their business, investing in tools can only go so far – founders need to look inwards to the makeup of their team. Dedicated cyber teams or cyber skillsets within the IT function benefit greatly from diversity of thinking and experiences. It’s critical that founders do not gatekeep cyber for those with traditional cyber CVs and prioritise hiring beyond only candidates with STEM degrees, including reskillers and career changers at all ages and stages of their careers.

Building the visibility of role models within the industry is also key to improving diversity. This is essential for demonstrating a path into cyber for those from underrepresented groups and will pave the way for a greater variety of skills and backgrounds within the industry in the long run.

Building cyber resilience is increasingly important in the current landscape, but so too is ensuring growth in a volatile economy. My other piece of advice for founders is that success for 2025 also lies in how you position your service or product during a time when organisations’ budgets are stretched.

A vital element of navigating the market is to put people’s problems first during the development phase. Focusing on niche or singular tech is risky and from my experience, the most successful founders don’t expect people to put their product/service above their problems. When interest does start to come and growth begins, they also need to be patient and shouldn’t expect large companies to move too quickly.

Zuzanna Stamirowska, CEO and Co-Founder, Pathway

The artificial intelligence startup landscape has been exciting and everchanging over the past couple of years. While the opportunity that this creates will still be there in 2025, only those who are pushing the boundaries of functionality and keeping pace as the technology continues to develop will thrive.

These strongly differentiated and defensible technologies are the businesses that investors will have their eye on in the new year. It will be critical to be ahead of the major changes that are going to shift the AI market. For example, the rise of o1 from OpenAI is set to be the biggest disruption to AI since its development. Its capacity for deeper reasoning is exciting, and I look forward to seeing how the startup community capitalises on this opportunity.