Evroc seeks to raise €3B to build sovereign ‘hyper-scale’ data centers in Europe

Stockholm-based startup Evroc is planning to raise €3 billion (approximately $3.2 billion) to develop Europe’s first sovereign “hyper-scale” data centres.

“It’s a very ambitious project,” said Evroc founder and CEO Mattias Åström in an interview with Reuters. “We will need to sort of continuously raise funding for the next five years.”

Evroc has so far concluded a seed financing round, with participation from Swedish venture capitalists EQT Ventures and Norrsken VC. The startup plans to construct eight hyper-scale data centers by 2028 and hire more than 3,000 people.

According to Åström, the data centres will use the “eco load balancer” technique. The system will move data processing between Evroc’s data centres based on the availability and affordability of renewable energy.

The startup plans to initiate a pilot centre in Stockholm next year and begins scouting for suitable locations for new sustainable data centres in northern and southern Europe.

Foundation for sovereign digital sector

Established in 2022, Evroc recognizes the growing demand for data across Europe. It claims that cloud services hold a central role in critical digital infrastructure. From 2017 to 2022, the cloud market in Europe grew fivefold.

The Swedish startup, however, pointed out that most hyper-scale cloud services in the region are offered by American companies. Hyperscale cloud services support large-scale businesses, allowing them to scale up as their resource needs grow. The market share of European industry players in the cloud market declined from 27 percent to 13 percent between 2017 and 2022.

Åström explained that the lack of domestic hyper-scale cloud service providers creates a “serious challenge” for the region because these foreign companies operate under regulations that may not comply with European privacy laws. He also said the domination of foreign companies in Europe’s digital sector is a “real threat” to the region’s competitiveness.

EQT Ventures partner Ted Persson said Evroc had found an “exciting opportunity” to turn Europe into a leader in the cloud market. He also expressed optimism that the next-gen European tech companies would be developed on Evroc’s cloud services.

Tove Larsson, a general partner at Norrsken VC, also pointed out that Evroc’s cloud solutions adhere to Europe’s sustainability target. Larsson said Evroc’s strategy for clean energy use and implementation of “state-of-the-art” energy-efficient technology would become the standard in the cloud sector.