Cathay Innovation, the venture arm of Paris-based Cathay Capital, has made a bold move in European venture capital by unveiling a massive €1 billion AI-focused fund. As one of the largest AI-dedicated funds ever raised in Europe, this milestone signals rising investor conviction in artificial intelligence’s potential to reshape industries. With this fund, Cathay joins a select group of European VCs like EQT Ventures and Atlantic Vantage Point—that have surpassed the billion-euro threshold.
This third fund marks a strategic pivot for Cathay Innovation. Unlike others chasing foundational model development, Cathay is betting on application-layer AI—startups that apply artificial intelligence to solve industry-specific problems. The goal: fund nearly 30 companies across the globe, from seed to late-stage, with larger investments of up to €50 million per company over time. About half of the capital will go to European startups, while the rest will support high-potential ventures in the US and Asia.
Backing Real-World AI That Changes Lives
Since its launch in 2015 by Denis Barrier and Mingpo Cai, Cathay Innovation has built a reputation for bridging continents and sectors. The firm has invested in over 120 startups across five continents, with several achieving unicorn status and IPOs. What sets Cathay apart is its laser focus on AI’s real-world applications—especially in sectors like digital health, fintech, energy, consumer services, and mobility.
Cathay’s new fund is designed not just with capital in mind, but also collaboration. A mix of financial and strategic limited partners (LPs) are backing the fund. These include major players like Sanofi, TotalEnergies, Valeo, BNP Paribas Cardif, Groupe SEB, and Groupe ADP. These LPs don’t just invest—they collaborate. Past examples include Sanofi’s partnership with Owkin, a Cathay portfolio company, in AI-powered drug discovery.
So far, €235 million from the fund has already been deployed into 14 startups—seven of them European. Some key investments include:
- Bioptimus: A French biotech building the “Biology GPT,” raised $76M for AI-powered biological systems modeling.
- Aqemia: Based in Paris, this startup uses AI and physics to accelerate RNA-based drug discovery.
- Nelly: A Berlin-based platform that digitizes healthcare admin tasks, recently secured €50M.
- FirstVet: A Swedish platform offering video-based veterinary care, raised €20M to expand.
- Nabla: Known for its AI assistant that generates clinical notes, already used by 20,000+ doctors.
- Entalpic: Focused on AI for discovering new materials in energy and pollution control.
These investments illustrate Cathay’s push to fund tech that delivers both impact and scale, particularly in healthtech, biotech, and industrial AI.
Leading With Purpose: Global, Strategic, and Sustainable
What makes Cathay’s fund stand out isn’t just its size or global strategy—it’s also its commitment to sustainable innovation. As an Article 8 fund under the EU’s Sustainable Finance Disclosure Regulation, it actively promotes environmental and social benefits. The firm tracks ESG indicators like carbon footprint, workforce diversity, and employee well-being, aligning each investment with long-term societal goals.
Cathay’s global footprint—with offices in Paris, San Francisco, Shanghai, and Singapore—gives it an edge in sourcing cross-border deals and helping startups scale internationally. Its investment model blends financial capital with deep corporate partnerships, offering startups not just funding but access to major industry players.
By centering its new €1B vehicle on application-layer AI, Cathay Innovation is carving out a unique role in the AI ecosystem. It’s not about hype or chasing foundational breakthroughs—it’s about real transformation, backed by real strategy. In an increasingly competitive VC environment, Cathay’s scale, global reach, and collaborative approach position it to shape the next generation of AI innovation.
