Spotify chief executive daniel ek has pledged to invest 1bn into european tech start-ups in a bid to challenge the dominance of silicon valley.
If you compare europe versus the us, were still, by an order of two or three, underfunding for each and every stage in europe compared to american [venture capital] companies, mr ek said, speaking at slush, a technology conference.
Some of the most promising tech talent in the world automatically leaves europe because they dont feel valued here. we need more super-companies that raise the bar and can act as an inspiration, he added.
Mr ek will devote 1bn over the next decade to early stage moonshots that may be too early for most venture capital firms. he cited the areas of machine learning, biotechnology and materials science as interesting sectors.
The 37-year-old swedes personal wealth soared above $2bn after spotify listed shares on the nyse in 2018. with about a 9 per cent stake in the company, mr eks wealth is estimated at about $3.8bn.
He has previously made small investments in start-ups including kry, a swedish telemedicine company, the uk housing website , and an artificial intelligence company called hjn sverige.
Europe has created tech groups such as spotify and skype, but has trailed the us and china, which have bred giants including amazon, apple and alibaba. sceptics have blamed europes more regulated market and a lack of funding for the gap.
In the second quarter, european start-ups raised $7.3bn in 843 deals, according to cb insights data. asian companies raised almost double the amount of funding, while us start-ups nearly quadrupled that total.
Some us venture capital firms, such as sequoia capital, have recently begun to form investment teams in europe, where start-up valuations have largely been lower compared with in the us and asia.
Sweden counts just three start-ups valued at more than $1bn, according to cb insights: the payments group klarna, grain-based drink company oatly and battery developer northvolt.
Mr ek argued that the cultural differences between europe and the us could be an asset in carving out innovation for collective welfare.
He sees the european dream as focused more on building a better future for the collective, not just the individual, which is at the heart of the american dream.