2024 has exposed the fragility of the European startup ecosystem. While AI-related companies have continued to attract capital, many other seemingly promising companies have closed their doors. From giants valued at billions to small, innovative companies, here is an analysis of the most significant failed startups of the year.
The electric vehicle giant: Arrival
The parable of Arrival represents one of the most emblematic cases of failed startups in 2024. Founded with the ambitious goal of revolutionizing the commercial electric vehicle sector, the company had won over investors with his innovative vision of modular vehicles and the promise of sustainable production.
In 2021, Arrival had achieved the largest IPO in history for a British tech company, listing on the Nasdaq at an extraordinary valuation of $13 billion. The company had been celebrated by former Prime Minister Boris Johnson as a symbol of British technological excellence.
Arrival's failure shows that even the highest ratings are no guarantee of success
A February 2024, Arrival's UK arm has filed for administration, marking the end of a dream that had attracted global attention. Sometimes, failed startups include those that started too soon: I think Arrival falls squarely into this category.
The Two-Wheel Revolution Interrupted: Cake
The Swedish Cake, founded in 2016, had established itself as one of the most promising brands in the lightweight electric motorcycle sector. With a distinctive design and a strong focus on sustainability, it had attracted investments of 60 million euros from prestigious funds such as creandum e Headline, in addition to the Swedish pension fund AMF.
The attempt to raise a 7 million euro bridging loan in end of 2023 proved unsuccessful, leading to bankruptcy for February 2024. The society was then acquired from Norwegian Brages Holdings for just 1,6 million euros, a fraction of the invested capital. In other words: Cake is one of those failed startups that we may see resurrect (or walk like a zombie: we'll see).
The Next Generation Car Marketplace: Cazoo
Cazoo represented one of the largest European bets in the online car sales sector. The listing on the Nasdaq in 2021 with a valuation of 8 billion dollars seemed to confirm the revolutionary potential of its business model. Wide diffusion of the brand, luxury sponsorships (in Italy also Bologna football club, as you can see in the photo), but the spark with the public did not ignite.
In the end, the burden of a debt of 630 million dollars proved unsustainable. The attempt to restructure the debt was not enough to convince new investors and, in May 2024, the company had to declare receivership.
The Broken Dream of Logistics: Cubyn
cubyn represented one of the most interesting promises in the French logistics sector. Founded in 2014, the company had developed a complete warehousing, packaging and shipping service for online retailers and marketplaces. The boom in e-commerce during the Covid period had given a strong boost to its growth, so that in 2023 had managed to raise a Series D round of 15 million euros, reaching a valuation of 175 million.
The interest of leading investors such as DN Capital, Partech, Bpifrance, Eurazeus e 360 funds seemed to confirm the solidity of the project. However, operational challenges and market changes led the company to initiate insolvency proceedings a July 2024, with the definitive closure two months later.
Autonomous mobility in crisis: EasyMile
In the autonomous mobility sector, the failure of EasyMile was a major blow to its European ambitions. The French startup had made its mark with its autonomous shuttles, later expanding its business to freight transport to diversify its revenue sources. In 2021, it raised a €55 million Series B round, bringing its total funding to around €90 million.
Despite the support of prestigious investors such as Searchlight Capital Partners, Alstom, Bpifrance, Shelf, NextStage AM e McWin, the company has failed to overcome the difficulties of an increasingly demanding market. In July, the declaration of insolvency marked the end of a project that promised to revolutionize urban transport.
Among the failed startups, also the “princess” of vertical farming: Infarm
Infarm represents perhaps one of the most emblematic cases of failed startups in 2024. With 1.400 vertical farms, 1.000 employees and a presence in 10 countries, the company was considered one of the jewels of the European tech scene. The support of investors of the caliber of Balderton e Atomic had raised nearly $500 million, reaching a valuation of $1 billion.
However, the combination of operational inefficiencies, rising energy costs and tough competition from traditional manufacturers has gradually eroded the sustainability of the business. The decision to lay off 500 employees at the end 2022 it was not enough to reverse the trend (if anything to accelerate the end), and in theOctober 2024 The UK division has had to announce its intention to appoint administrators.
The Broken Dream of Flying Taxis: Lilium
The case Lilium represents one of the boldest visions and, at the same time, one of the most spectacular falls in the European tech landscape of failed startups. Founded in 2015, the German startup had captured the imagination of investors and the public with its promise to revolutionize air travel through zero-emission flying taxis. The interest of prestigious investors such as Atomic, Early Bird e Tencent seemed to confirm the solidity of the project.
The moment of maximum splendor arrived in 2021 with the listing on the Nasdaq through the merger with Qell Acquisition Corp. But the dream quickly turned into a nightmare: the value of the shares fell by 93%, post-IPO objectives remained on paper and, in theOctober 2024, the insolvency declaration arrived followed by the delisting from Nasdaq.
The Urban Mobility Revolution: MaaS Global
MaaS Global had an ambitious vision: to radically transform the way people move around cities. The Finnish startup, through its app whim, promised to unify all means of city transportation into a single, intuitive platform. With over $162 million raised from investors such as NordicNinja, BP Ventures, Toyota e Mitsubishi, seemed to have all it takes to prevail.
However, the complexity of coordinating multiple transportation services, coupled with the challenges of the pandemic and the difficulty of scaling the business model, led the company to file for bankruptcy in March 2024, demonstrating how complex it is to innovate (even though the recipe is clear) in the urban transport sector.
Failed Startups, There's Also Innovative Proptech Masteos
The story of Masteos perfectly illustrates the challenges of the proptech sector in an evolving real estate market. Founded in 2019, the French startup had developed a complete service for real estate investments, from research to property management. The initial success had led to raising around 70 million euros, culminating in a 40 million Series A round. in 2022.
The company had big european expansion plans, backed by leading investors such as Daphni, DST Global e EDF Pulse Ventures. However, the deterioration of the real estate market e the increase in operating costs have rapidly eroded growth prospects. A January 2024, Masteos had to declare insolvency. With a “Walking Dead” ending in this case too: in an epilogue emblematic of the volatility of the sector, the company was acquired by Newaxia for just 1 million euros, a fraction of the invested capital.
These failed startups highlight how thin the line is between innovative vision and operational sustainability. Startups aiming to disrupt traditional industries often find themselves having to balance transformative ambitions with the harsh realities of the market, a challenge that in 2024 has proven insurmountable for many, even promising, companies.
Mycorena's Food Innovation
The story of Mycorena represents one of the most interesting cases of failed startups in the foodtech sector. The Swedish startup, launched in 2017, had specialized in the development of proteins from mycelium for meat alternatives. With a total of 35 million euros raised, the company seemed well positioned to ride the rising wave of the alternative protein market.
However, the failure to raise the second round of financing triggered a devastating domino effect. A June 2024, the company had to announce the interruption of its flagship project: the construction of a large-scale factory in Sweden. The following month it filed for bankruptcy. In an epilogue emblematic of the volatility of the sector, the Belgian company Naplasol, specialized in plant proteins and previously a shareholder of Mycorena, acquired the bankruptcy estate for a sum that investors they called it "derisory". See you again, zombies.
The Battery Giant: Northvolt
The case Northvolt represents perhaps the most striking failure of 2024. The Swedish company had started the year with what seemed like a triumph: obtaining the largest green loan in European history, worth $5 billion. Since 2015, Northvolt has raised over $13 billion in funding from high-profile investors, including Goldman Sachs, Volkswagen and numerous pension funds.
But 2024 proved to be a fateful year. The company faced significant delays in production and, even more severely, BMW's cancellation of contractsCosts dramatically outpaced revenues, and after a failed attempt to raise additional capital, the company filed for Chapter 11 bankruptcy in the United States in November.
Innovation in computer vision: Prophesee is among the failed startups in 2024
The French prophetess represented excellence in the field of advanced computer vision. The company had developed a cutting-edge “neuromorphic” technology, designed to mimic the structure and function of the human eye and brain. A May 2024 seemed to have achieved a significant milestone when it announced that its technology would be implemented in products from American tech giant AMD.
However, despite having raised a total of 126 million euros, the company had to declare insolvency in October, entering into judicial administration. According to as reported by Les Echos, the main problem was that the collection of the next round of financing took longer than expected.
The End of an Era in Coworking: Second Home
Second home was more than just a coworking space: since 2014, it had become a hub for London's startup community, known for its vibrant design and green spaces. With the backing of leading investors such as Index Ventures, Atomic e Yuri Milner, the company had raised over £60 million and had managed to expand with offices in London, Lisbon and Los Angeles.
But the increase in operating costs and the devastating impact of Covid on the shared workspace sector have led to a downward spiral. In theOctober 2022, the Silicon Valley billionaire Riaz Valani had become the majority shareholder in a cut-price rescue operation, after years of losses. The story ended definitively in December 2024, when Second Home filed for receivership, entering fully into the ranks of failed startups.
Fintech startup Stenn also collapses
The story of stenn is particularly significant in the fintech landscape. Founded in 2015, the London-based firm specialized in invoice financing for e-commerce, cross-border trade and SaaS companies. With over $50 million raised and a valuation that in 2022 had reached $900 million, Stenn seemed destined for a bright future.
However, in December 2024, HSBC Innovation Banking has filed an application to appoint administrators. While Stenn said it was “actively defending” its position against the move, the case highlights the fintech sector’s growing vulnerability in an environment of rising interest rates and increased regulatory “attention.”
The second “cold case” among failed startups in Swedish electric mobility: Vässla
The case of Vassla, a Swedish e-scooter startup founded in 2017, is particularly interesting because it occurred in the same month as Cake’s bankruptcy, highlighting the structural challenges of the light electric mobility sector. With around 13 million euros raised from more than 100 shareholders, Vässla had set its sights on an innovative business model in the micromobility sector.
The bankruptcy declaration came in February 2024, and the bankruptcy estate was acquired by EverEngineering for just €370.000 in March, a fraction of the original investment.
Failed Startups: Key Lessons for 2024
Analyzing these fifteen failed startups reveals recurring patterns and valuable lessons. I try to summarize the notes I took along the way:
High capitalization is no guarantee of success, as demonstrated by the cases of Northvolt e Arrival;- Sectors hardware intensive require not only enormous capital
but also impeccable operational management; - The transition to profitability is crucial, especially in the event of sudden periods of “lean” financing;
- Business models must always be sustainable, even beyond the initial growth phase;
- Last, obvious, self-evident: technological innovation must always be balanced with financial sustainability.
Failed Startups, What Will Happen in the Future?
These failed startups do not necessarily signal an irreversible decline of the European startup ecosystem: on the contrary, they are an indication of its maturation. Investors are becoming more selective, favoring sustainable business models over growth at all costs. Furthermore, the concentration of failures in specific sectors such as electric mobility and the foodtech suggests the need to rethink some approaches to innovation in these specific areas.
2024 has taught us that innovation remains essential, but must be pursued with greater attention to economic and operational sustainability. The startups that will survive will be those capable of balancing innovative vision and financial solidity, in a market that no longer forgives the excesses of the past. Memento!
