EQT-managed EU fund invests in $400m Lovable fundraising round at $13.3bn valuation

The European Union-backed Scaleup Europe Fund managed by EQT has invested $400 million in a Series C fundraising round led by Menlo Ventures for Swedish AI coding company Lovable. This investment has valued the company at $13.3 billion, nearly doubling its valuation from $6.6 billion in December. Menlo Ventures led the round, with participation from existing venture investors and new backers from Asia and Latin America, including Tencent.

This $400 million infusion more than doubles Lovable's valuation, highlighting the swift re-pricing of leading AI companies. The €5 billion European fund's goal is to bolster European scaleups and bolster the region's capacity to foster technology companies at a global scale. Lovable, based in Stockholm, provides AI tools enabling users to create websites, applications, and software via natural-language instructions instead of traditional programming.

The business is part of the burgeoning 'vibe coding' sector, which has gained commercial success due to generative AI. Since its inception, Lovable's platform has facilitated over 60 million projects, with applications built on it attracting more than 900 million monthly visits. Its annual recurring revenue has seen a notable increase, nearing $600 million by the end of August.

As AI-assisted software development becomes more competitive, with players like Anthropic, OpenAI, and Google developing coding tools, Lovable has increasingly targeted enterprise clients, partnering with companies such as Adidas, Deutsche Telekom, and Nvidia. The newly acquired capital will be used for product development, infrastructure expansion, and workforce growth.