Meanwhile, Kyiv is positioning itself as the most important rising star in the European tech ecosystem.
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This year's Global Tech Ecosystem Index has crowned Paris as the top tech hub on the continent.
The report analysed tech talent, innovation and investment in 288 cities and 69 countries.
The French capital also placed fourth in the global ranking, while London ranked 6th.
Cambridge, Munich, Stockholm and Grenoble were the only other European cities to make it to the global top 20.
Cambridge shows best talent concentration in Europe
Analysts say the UK has been attracting fewer funds in recent years. Its startups raised just slightly more than €19 billion in 2024, reportedly the lowest amount since 2020.
Nonetheless, the UK remains a driving force of Europe's tech scene.
According to the report, Cambridge has the highest concentration of tech talent in Europe, with an enterprise value of over €162 billion, with a population of just around 150,000 people.
Density leaders are "ecosystems that outperform relative to their population size, showing exceptional innovation output per capita."
"These hubs are marked by high startup activity, research intensity, and strong university linkages, proving that world-class ecosystems can emerge anywhere", says the report.
Kyiv ranks as top European rising star as Lagos leads globally
The report also ranks the top rising stars in Europe, depending on growth in enterprise value and unicorns, which are privately-owned startups valued at over $1 billion, all of that adjusted to local GDP per capita and cost of living.
Lagos in Nigeria is on top of this list globally, having created five unicorns and grown its ecosystem value by more than 11 times since 2017, despite being a smaller economy.
In Europe, the top rising star is Kyiv, followed by Vilnius, Zagreb, Prague, Warsaw and Athens.
Experts say Ukraine's tech hub is booming, with tech professionals growing from an estimated 75,000 in 2014 to over 300,000 in 2023.
The Ukrainian capital is home to over 1,000 tech firms, including Ajax Systems and Grammarly.
A few months ago, the World Economic Forum chose Kyiv to open its new GovTech centre, to exchange best GovTech practices and innovative solutions.