Welcome to Sunday CET. Let’s get to it.
10 things you need to know
Euro intel this week
→ 30+ curated early stage deals including:
🇫🇷 Absolute Labs
→ 11 funds w/ fresh powder
→ Nordics going after the US market
→ British VC extending Euro reach
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Quick notes on active American investors in Europe in Q1
- 400 tracked as active in Europe vs 600+ in Q1 2022
- top VCs: Accel, Headline, FJ Labs, ff VC, Base10, Sequoia, FinTech Collective
- top angels: Scott Belsky, Charlie Songhurst, Guy Podjarn
- Tiger Global, Insight Partners and Coatue did only one deal each, compared to 20, 13 and 8 respectively in Q1 2022.
- Lightspeed, Spark and USV also slowed their horses to a deal each.
- MS&AD, the corporate VC of the 5th insurance group in the world made 3 deals. Goldman Sachs also was involved in 3 equity deals.
Plant-based food sales are growing - the 2022 market was €5.7 billion in sales and grew 22% from 2020.
2.5 million tonnes of chocolate & chocolate bars were exported by the EU (65% went to other EU countries) in 2022. Top exporters:
🇩🇪 Germany (680 000, 28% of total exports)
🇳🇱 Netherlands (322 000, 13%)
🇵🇱 Poland (295 000, 12%
Kima Ventures numbers as of Q1 2023. From 2016 onwards it deployed 15M per year, on average.
1000+ startups investors active in Sweden in 2022 - here’s top 100 (VCs, angels, family offices, international etc)
BeReal fatigue - American anecdotes
The Canary Wharf is alive and kicking - home to 180 startups and scaleups in FinTech, Cyber Security, CleanTech, Blockchain, Life Sciences and HealthTech.
Do cold emails work? - gotta do it right
🇪🇺 If you’re not following the PR coming from the EU dealing with technology business at large, you should know that the general operating principle is that EU should be sovereign, whatever that means.
And this includes the space as it results from an European Space Agency’s report outlining the necessity for Europe to become a leader in rocket launching and human spaceflight.
Don’t get me wrong, it is nice to be ambitious and have big hairy audacious goals and even dream with the eyes open that you can become a superpower. Frankly speaking though, Europe simply is not having what it takes - specifically in technology, this idea that a super state force composed of politicians and bureaucrats from 30 different countries who have no clue how the real world works but is able to create rules and regulations that prevent the market freely doing its thing - that it can achieve tech sovereignty is silly and idealistic at best. And that is because the EU seems only busy with regulating whatever comes new from the foreign popular tech developers, while failing to admit that its backyard may not be the ideal garden for nurturing top notch ideas. And this inevitably leads to value destruction - aggressive regulation makes for high overheads for big tech which in turn has to extract value from a market big in aggregate but fragmented and rather difficult to monetise otherwise. Instead of focusing to make the pie bigger, the EU is focusing to preserve a shrinking pie and make it only available to locals.
But maybe it’s just me noticing only a particular mindset that’s getting across publicly while the EU is this visionary tech leader yet to produce something other than being at odds with American tech vendors. On the other hand, the local dudes from the private market (which can actually solve this problem by tackling it from a meritocracy angle) may be a few billions too short to be sovereign enough:
The narrative that European billionaires are starting to take an interest in creating novel space or defence technology is often misguided.
Most European wealth is not generated by large exits in tech industries, and therefore most European wealth does not seek to diversify into such high-risk endeavours. To date, Richard Branson of Virgin, Daniel Ek of Spotify and Niklas Zennström of Skype are the best known European billionaires in the deep tech startup world, but their net worths are between $1–3bn each — they won’t be financing an entire space sector any time soon.
[…] And so Europe and the UK continue their decades-long struggle to manifest a space industry, in an economy that does not have the right billionaires. Unlike US counterparts which seek to create wealth, European family offices seek merely to preserve it.
A while ago I wrote a little about the typical European HNWI not giving a damn about sovereignty. You should read it and tell me that I am wrong. :-)
… Alas, back to the space ambitions - it’s not all doom and gloom, people are going to work every day and actual efforts are being are being made - the European Space Agency just launched a spacecraft sent to explore Jupiter and three of its icy moons that could hold buried oceans.
🇮🇹 Italy’s privacy watchdog gave OpenAI an April 30 deadline to respond to an extensive list of demands in order to resume operating ChatGPT in the country.
Meanwhile, The European Data Protection Board announced a new task force designed to set privacy rules related to ChatGPT following Italy’s investigation.
🇬🇧 Apparently in the UK if you raise >5 million in an equity round, the associated costs can go as high as 20%. Sounds like a joke but it’s not.
🇫🇷 The French government meddles with the private business yet again - it punishes online stores in order to incentivise good consumer behaviour and forces an extra 3 euro charge for the delivery of books to encourage readers to go more to bookstores.
🇬🇧 Any KPI is good for PR: Uni of Oxford has created 300 spinoff startups based on research and ideas from students, staff and alumni, since, uhm, 1959.
🇸🇪 The most influent family from Sweden, which controls a good part of the economy, is pissed about a push by proxy advisory firm Institutional Shareholder Services to end dual-class share structures in Europe. The proposals mean that from February next year the firm will generally vote against directors at a company that has a common stock structure with unequal voting rights.
🇳🇴 Shifter, local media pub covering startups coming out of Norway, was acquired by Schibsted.
🇩🇪 Berlin gyms charge €€€ for tap water. Does that say something about:
- the German culture
- the German way of doing business
- a business opportunity?
🇩🇪 Students are declining VC gigs because of the housing situation in Berlin and how hard it is to find a flat.
Monday CET preview
The Q1 recap
We have tracked almost 1500 startup transactions closed in Europe in Q1 2023. We have screened them all and produced a list with 200+ early stage deals we found to be interesting. You can consult it below.
A few observations beforehand:
• while the overall numbers trend is bad, there's more funding for startups doing practical stuff and building actually interesting business. Alas there's less SAAS for hipsters and similar noise because the ZIRP forced VCs to focus on revenue models.
This is a preview from the latest Monday CET, a premium newsletter covering data-based intel from the European VC ecosystem. You can subscribe to get it too from here.
Tell investors exactly how much capital you’re raising, not a vague range of, say, $2 million to $10 million. And if you tell them you only need a few hundred thousand dollars, they’ll never take you seriously. They know you can’t turn a startup into a publicly traded company with a few hundred thousand dollars. Take what you would ask from a European VC and double it. Maybe triple it.
🤔 Soundboy trying to articulate why the tech world should take a step back with the AI development and figure out a control mechanism. I think being more cautious is better rather than stop in the middle of momentum tbh - you should read the piece nonetheless.
⚡ The quest for the European microchip from the 1980s to the present.
⚡ We’re peak AI → Becks is producing the world’s first beer and full marketing campaign made with artificial intelligence. Here’s a free product idea: use AI to cure beer hangover. <ducks>
🤌 Twitter is working on a generative AI project, and recently purchased roughly 10,000 GPUs to develop and train a large language model.
🤔 Remember the metaverse? It was supposed to be the future, alongside web3. But no worries, the admen still have the metaverse in the media plans, now that everybody and their mothers pivoted into AI now.
🇯🇵 The Japanese government approved plans to open the nation’s first casino, operated by MGM and expected to open in 2029.
💲 How much should you tip in each country?
🧑💼 The jobs that are most and least suitable to being done remotely.
🗽 The number of Americans planning to travel to Europe this summer has skyrocketed.
🎶 A century of recorded music has culminated in the infinite archive of streaming platforms. But is it really better for listeners?
🙈 The village sin eater - the family who hired the sin eater believed that the bread literally soaked up their loved one’s sins; once it had been eaten, all the misdeeds were passed on to the hired hand.
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