Accel's general partner, Sonali de Rycker, one of Europe's most influential venture capitalists, is a bullish view of the continent's AI outlook. But her over-regulation caution may hinder its momentum.

De Rycker's position in Europe in the global AI competition was reflected on the TechCrunch StrictlyVC evening in London earlier this week, maintaining optimism with realism. “We have all the works,” she told the gathering events. "We have entrepreneurs, we have ambitions, we have schools, we have capital, we have talent." She believes that all we lack is the ability to "release" this potential.

obstacle? Europe's complex regulatory landscape is partly its groundbreaking but controversial AI bill.

De Rycker acknowledges that regulations can play a role, especially in high-risk sectors such as health care and finance. She said she remains concerned that AI ACT's wide reach and stifling fines could prevent innovation at the moment when European startups need space to iterate and grow.

“There is a real opportunity to make sure we go fast and solve our capabilities,” she said. “The problem is that we are also facing regulatory headwinds.”

The AI ​​bill imposes strict rules on applications deemed to be "high risk", from credit scores to medical imaging, which have raised red flags among investors such as de Rycker. While ethical AI and consumer protection goals are commendable, she fears that the network may be too broad and can be frustrating early experimentation and entrepreneurship.

Amplify this urgency by shifting geopolitics. With the U.S. support of Europe’s defense and economic autonomy, Derek sees this moment as the decisiveness of the EU in the current Trump administration.

“Now Europe is surrendered in many ways,” she said. “We need to be self-sufficient, we need to be sovereign.”

This means unleashing the full potential of Europe. de Rycker pointed to efforts such as the “28th regime”, a framework aimed at creating a set of rules for businesses across the EU, which is crucial to creating a more unified, business-friendly region. Currently, the misfortune of labor law, licensing and corporate structures spans 27 countries, creating friction and slowing progress.

“If we were indeed a region, the power you could unleash would be incredible,” she said. “We wouldn’t have the same conversation about the conversation that Europe lags behind technology.”

In De Rycker's view, Europe is slowly catching up, not only in innovation, but also in the process of risk and experimentation. Cities such as Zurich, Munich, Paris and London are growing due to the growing community of top academic institutions and experienced founders.

Joining Europe and Israel has invested in more than 70 cities, making De Rycker a front seat for the continent’s scattered but booming technological landscape.

Still, on Tuesday night, she noticed a sharp contrast with the United States in terms of adoption. “We see customers tend to do AI in the U.S. more,” she said. “They spend money on early stage companies like this. Flywheel keeps moving forward.”

Accel's strategy reflects this reality. Although the company has not yet supported major basic AI model companies like OpenAI or Anthropic, it focuses on the application layer. “We are very satisfied with the application layer,” De Rycker said. “These underlying models are capital-intensive and do not look like companies invested by venture capital.”

Examples of promising bets include Synthesia, a video generation platform for enterprise training, and Speak, the language learning app recently jumped to a $1 billion valuation. de Rycker (avoiding issues regarding negotiations on ACCEL reports in AI) sees it as an early example of how AI can create entirely new behaviors and business models, rather than just gradually improving existing behaviors.

"We expanded the total addressable market at a rate we've never seen before," she said. "It feels like the early days of the phone. Doordash and Uber are not only mobilizing websites. They are a whole new paradigm."

Ultimately, De Rycker believes that this moment is both a challenge and an opportunity for a generation. If Europe regulates too much, it has the potential to kill innovations that can help it compete globally, not just in AI, but across the entire technology.

“We are in super cycles,” she said. “These cycles don’t come up often and we can’t afford them.”

With the rise of geopolitical uncertainty and the increasingly introverted appearance of the United States, Europe has no choice but to bet on itself. Whether it can do so without tying its own hands remains to be seen. But if the continent can achieve the right balance, De Rycker believes it has everything it needs to lead, not just everything it follows in the AI ​​revolution.

Respondents asked what EU founders could do to be more competitive with their American counterparts, de Rycker did not hesitate. "I think they are competitive," she said, citing Accel's support, including Supercell and Spotify. “These founders, they don’t look different.”

You can have a full conversation with De Rycker here:

[embed]https://www.youtube.com/watch?v=s2zwr0qknac[/embed]