By Supantha Mukherjee

STOCKHOLM, May 14 (Reuters) - Venture capital firm Accel

said on Tuesday it has raised a $650 million fund to invest in

early-stage companies in Europe and Israel with a focus on

artificial intelligence and cybersecurity.

The new fund will be Accel's eighth since opening its London

office in 2000. Accel has so far backed more than 200 companies

across 20 countries in the region and still has investments in

more than 100 companies.

"It takes about three years to invest the fund and then the

life of a fund is typically around 12 years," Harry Nelis, a

partner at Accel, told Reuters, adding that Accel will invest in

25 to 30 new companies.

Accel, known for early investments in companies such as Meta

and Dropbox ( DBX ), had also invested in major

European companies such as Deliveroo ( DROOF ), Spotify ( SPOT )

and Supercell.

The European and Israeli VC market has been growing fast,

with investments of $66 billion in 2023 compared to $150 billion

in the United States, according to data from Dealroom. In

comparison, the investments amounted to just $1.1 billion in

2003 versus $17 billion in the U.S.

"AI is going to be a big platform shift that will probably

run for the next 10 years and we expect to place a good number

of bets in AI companies," Nelis said.

While AI companies of interest can emerge anywhere in

Europe, London and Paris have become hubs for AI development, he

said. "London because of DeepMind and Paris because of Facebook

AI Research (FAIR)."

London-based DeepMind is an AI research laboratory which is

now owned by Alphabet. Meta opened FAIR in Paris in

2015 and it has become its hub for AI advancements.