Hungary’s AI ecosystem faced a significant funding decline in 2024, dropping by 47% compared to 2023. Despite this setback, key early-stage startups continue to attract investors, and the AI workforce is expanding.
Hungarian AI startups raised €25M in startup funding in 2024, an impactful decline from €47M in 2023. This places Hungary second to last in AI funding within the CEE region.
Despite the decrease, international investors such as Thrive Capital (US), Lakestar (Europe), and Interactive Venture Partners (UK) continued to support Hungarian AI startups.
The information in this article is based on The Recursive’s State of AI in 2024 report. Download it here and get the latest insights about the CEE startup ecosystem.
Hungary accounts for 6.9% of AI startups in CEE
Hungary represents 6.9% of all AI startups in Central and Eastern Europe, placing it in the 7th place of CEE countries. As of August 2024, the country has 74 AI product companies, with the majority in the early stages of development.
The distribution of financing rounds in 2024 is as follows:
- 65% at the seed stage
- 16% at Series A
- 5% at Series B or C
- 7% at the pre-seed stage
Hungarian AI startups to keep in mind
Several early-stage startups in Hungary have managed to build a promising solution and attract funding:
- VRG Therapeutics – an AI-powered drug discovery platform, raising €8.4M from Széchenyi Funds and Vascular Group.
- Scoutlabs – a UK-Hungarian company offering AI-driven insect monitoring to improve sustainability in food supply chains. Raised €1.9M from DEPO Ventures, SVG Ventures, THRIVE, and Interactive Venture Partners and others.
- Delingo – provides AI-powered checkout solutions for canteens and micro markets, raising €4.3M from Frontline Ventures, Interactive Venture Partners, and Grep VC and others.
Venture capital funds raising new capital
On the positive note, Hungarian venture capital firms have managed to raise fresh capital in 2024, offering a good forecast to the following years:
- Lead Ventures launched a €100M fund in July 2024.
- Impact Ventures announced a €40M fund in September 2024.
Challenges in AI innovation and adoption
Despite Hungary’s expanding AI workforce, local businesses face challenges in adopting AI-driven solutions. A three-year study by K&H Bank found that while Hungarian companies are committed to digital transformation, many struggle with innovation.
Additionally, Hungary’s declining AI investments and low regional ranking highlight the need for stronger financial backing and support structures to remain competitive in the CEE region.
Hungary’s AI ecosystem has experienced a funding decline but continues to develop through early-stage startup activity and a growing AI workforce. With continued support from investors and VC funds, Hungary has the potential to strengthen its position as an AI hub in Central and Eastern Europe.
