CYBERSECURITY INDEX Q3 2026 - KEY INSIGHTS

Axeleo Capital (AXC) publishes the seventeenth edition of its Cybersecurity Index, a quarterly analysis of the European cybersecurity ecosystem, tracking investment dynamics, market structure, and emerging trends across the continent. 

QUANTITATIVE INSIGHTS

The European cybersecurity sector raised €459M across 33 deals in Q3 2026, more than doubling the ~€215M raised across 36 deals in Q3 2025, despite a slightly lower deal count. The quarter is also a sharp rebound from Q2 2026 (€185M across 27 deals) and the strongest quarter tracked by the Index since 2024. Year-to-date, European cybersecurity funding stands at ~€975M across ~98 deals, versus ~€705M across 105 deals at the same point in 2025.

Capital remains highly concentrated: Exein's €252M round alone accounts for 55% of the quarter's total, and the top 5 rounds represent ~81% of capital deployed. Early-stage rounds continue to dominate activity, with pre-seed and seed deals together accounting for 70% of all transactions in Q3, up from 59% in Q2. The quarter also recorded 9 exits, up from 6 in Q2 (see Exit Activity below).

KEY HIGHLIGHTS FOR Q3 2026

1. Top Deals of the Quarter

• Exein (IT), €252M (venture round, series undisclosed), led by Headline to build the security layer for Physical AI.
• Valarian (UK), €46.7M Series A, led by NEA, to strengthen UK sovereign digital infrastructure across government, defence and enterprise.
• Risk Ledger (UK), €28.2M Series B, from by Axiom Equity and Mercia to expand its customer network, define the future of AI in Supply Chain Security, and enter the United States.
• Mindgard (UK), €28M Series A, backed by Album VC and .406 Ventures to scale its automated AI red-teaming and runtime protection platform.
• Hackuity (FR), €16M Series B, led by Forgepoint Capital to strengthen AI-powered vulnerability management

2. Market Structure: Geography

The UK remains by far the most active ecosystem by deal count (15 deals, ~45% of the quarter), and also hosts three of the five largest rounds (Valarian, Risk Ledger, Mindgard). Italy leads in capital deployed this quarter, driven by Exein's €252M round, with 4 deals in total. France recorded 4 deals for €24M (Hackuity, AAIS, Marble, Preemptics), while Germany (3 deals) and Spain (2 deals) contributed a smaller, distributed share of activity.

3. Category Mix

Top categories in Q3 2026 include:

• Risk, Compliance & Governance (~24.0%)
• Application & Software Security (~19.8%)
• Cloud & Infrastructure Security (~14.6%)
• IoT & Industrial Security (~14.6%)
• Identity & Access Management (~9.4%)

Compared with Q2, the distribution is more concentrated, with Risk, Compliance & Governance and Application & Software Security together representing over 40% of the Index.

4. Early-Stage Volume, Concentrated Capital

Q3 2026 confirms the early-stage orientation of the market, with Pre-seed (39.4%) and Seed (30.3%) together driving 70% of deals. Series A accounted for 15.2% of deals, Series B and later for 6.1% (Risk Ledger, Hackuity), and rounds with undisclosed series for 9.1%.

Capital, however, follows a different pattern: a handful of large rounds (Exein, Valarian, Risk Ledger, Mindgard, Hackuity) account for the bulk of the €459M, while the remaining 28 deals together represent ~€88M.

EXIT ACTIVITY

Q3 2026 recorded 9 exits, up from 6 in Q2, indicating an accelerating pace of M&A activity across the European cybersecurity ecosystem. Acquisitions span network security and managed services, digital identity, non-human identity, security awareness, SIEM, cyber risk and compliance, data security posture management and smart contract security.

• FullProxy (UK), cyber security, network security and consulting services, acquired by Viatel (IE)
• Veridas (ES), digital identity verification platform, merged with Fourthline (NL)
• Cofide (UK), non-human identity security for application workloads and AI agents, acquired by Keyfactor (US)
• CyberPilot (DK), security awareness training and phishing simulation platform, acquired by SEPPmail (CH)
• Logmanager (CZ), security information and event management (SIEM) platform, acquired by Guardsix (DK)
• ednx (UK), software-defined network management and security platform, acquired by Viatel (IE)
• Hugin (NO), cyber risk management and compliance platform, acquired by Pistachio (NO)
• Soveren (UK), data privacy and security posture management, acquired by SecureSky (US)
• OpenZeppelin (UK), smart contract security (open-source libraries, audits, developer tooling), acquired by S&P Global (US)

5. Acquirer Landscape: European Buyers Lead, UK Targets Dominate

Six of the nine transactions involved European acquirers (Viatel, Fourthline, SEPPmail, Guardsix, Pistachio), with Viatel completing two acquisitions in the quarter (FullProxy and ednx). The remaining three were led by US players (Keyfactor, SecureSky, S&P Global). On the target side, UK companies represent 5 of the 9 exits, reflecting the depth of the British ecosystem.

METHODOLOGY:
The Cybersecurity Index is based on data from Axeleo Capital's analysis as well as databases, such as Crunchbase in particular. These data sources mainly gather information on deals and rounds that have been publicly disclosed; many other raises are taking place, but without announcements or communications on amounts (thus difficult to track). The analysis is limited to companies headquartered in Europe, and with a value proposition focused on Cybersecurity. As far as recorded fundraising is concerned, this refers to equity venture capital fundraising only (i.e. excluding debt fundraising, subsidies and aid other than equity).Please note that since the Q2 2026 edition, we have updated the categories used to classify Cybersecurity companies in the Index, in order to better reflect the current structure of the market and emerging sub-segments (such as LLM & Agent Security).

ABOUT AXELEO CAPITAL:
Axeleo Capital 2 is a €70 million venture capital fund dedicated to B2B Tech start-ups, including cybersecurity, across Europe. Axeleo Capital is a venture capital firm active on the European technology scene and backed by a large pool of entrepreneur-investors. The fund offers startup founders a unique support framework that combines equity investment, operational and strategic coaching and an active ecosystem of over 100 high-level partners and mentors. Its Cybersecurity investments include Seedata, Trustpair, Citalid, Mantra, Yogosha (exit) and Alsid (exit).