The one with the Germans pulling another Rocket Internet move.
#53
Hi guys, welcome to a new edition of Sunday CET.
Here’s what I have this week.
Euro strat
Powder:
🇮🇱 10D
🇪🇸 All Iron Ventures
All Iron joins quite a few funds announced in Spain in the past few months - Telefonica, Samaipata, 4 Founders, Kibo, Seaya, Faraday, Capital Energy, Axon, Nauta, K Fund, Aldea
Highlights:
🇬🇧 Gousto, operator of a subscription platform for selling personalized food meals, raised £25 million.
🇳🇱 The Protein Brewery, producer of protein-rich, animal-free food ingredients, raised €22 million.
🇳🇱 Koa was spun off from Telefonica’s accelerator, raises €14 million.
🇩🇪 Ownr secures €12.5 million for an interesting tech-based real estate business.
🇩🇪 Dr Oetker acquired flaschenpost for €1 billion.
🇫🇷 Carrefour purchases c’ Bon for €60 million.
Bets:
🇸🇪 3 Swedes founded an online pharmacy in London and just raised £5.6 million.
🇪🇺 Two podcasting startups - 1 and 2 - raised also.
🇸🇪 Orbital System, which manufactures consumer smart water solutions, raised $5.6 million.
🇩🇪 Talentspace, SAAS developer of an all-in-one live online recruiting event platform, raised €4 million.
🇬🇧 Sugar Cap, which provides financing to gaming studios, raised £1.5 million.
Other stuff:
🇩🇪 A hot thing in Germany is investing in aggregators of Amazon-based, small retailers. The trick is to find the top-reviewed, bestselling essential everyday products on Amazon, and buy the brands from the small business owners selling them.
You then build a platform aggregating the products and can have a good DTC op in place with nice economies of scale.
It is a smart insight, the long tail of Amazon is huge and there are a lot of unsung heroes of businesses doing seven figures this way, just out of Amazon infrastructure, which charges about 30% for all the overheads.
Now, don’t imagine for a second that the Germans had this insight or invented something on their own - far from it, they simply pulled a Rocket Internet and cloned the model of some Americans which were just valued $1bn back in July.
And shortly after, we have:
1. Razor, founded in August by, among others, the former venture director at Rocket Internet, and which already raised about $1M from 468, GFC and Redalpine.
2. Seller X, also launched in August by the founder of Dafiti - Zalando for Latin America, also backed by the Rocket Internet. They just raised from Cherry and Felix Cap.
Building startups and raising money in Europe is not that difficult if you come to think of it, right?
Now, can Europe become the most entrepreneurial continent? :D
🇪🇺 Under Armor offloaded MyFitnessPal (UK) and Endomondo (DK). Both were bought in 2015 for serious money, and both were solid in their vertical at that time.
Neither has evolved so much since then - probably Under Armour had no idea what to do them and now got scared of Apple which has advanced quite a bit with the Apple Watch in the fitness space.
Don’t expect a big company to take risks - this is a typical example of value destruction. MyFitnessPal was now acquired by private equity and Endomondo will be closed by the end of the year.
🇩🇪 Earlier this year, some Russians launched a neobank in Germany which now is valued at €100 million
🇫🇷 And there is another neobank which also raised and is being built by French people in London.
🇫🇷 e.ventures opens office in France, hires Jonathan Userovici
Euro insights
🇪🇺 Climate change is a bit like sports: everybody has an opinion about it. But building business in the space requires in-depth interdisciplinary knowledge.
We produced a report with 25 notable founders actively developing climate change impacting solutions.
🇪🇺 Covid has put VCs under the spotlight, and exposed their vulnerabilities.
The money quote: “There is tough competition for very few viable assets”.
Yes the competition is way higher, as you can invest in any geography or vertical now, subject to the investment mandate and thesis.
Also notable is that Zoom interaction reduced some of the VC bias from real life - things like judgement based on race, gender or nationality.
Also, I believe that the decision cycles have shortened.
🇬🇧 It looks like salaries have dropped for almost all startup positions in London. Economic recession means that budgets are cut.
However, the best candidates are in a better position than ever now and make more money since the world is flat and have more optionality.
Equally important, a second and a third job are more accessible now since working from home can give people flexibility to be involved in more gigs and earn more in aggregate.
🇫🇷 How to pick your startup job?
A good article based on the observation that when looking for a startup job the easiest way to find out about its future prospect is to check the pedigree of the investors.
My experience is also that early candidates identify with the mission, vision and the values of the company and they have a strong fit or level of trust with one of the founders or early employees.
🇪🇺 Cedric O, French junior minister:
“Europe has an economic opportunity, as the US economy isn’t as good as it used to be, and the European model is attractive. Therefore, we need to create the right environment and framework to nurture our startups.
Idle observation: there is no European model and there never will be one. If there were, that would involve a blueprint, alternative to build cool shit and apply to YC.
Besides, Europe is a pot of almost 30 cultures and ways of doing business. French are doing it different than Spanish, who are doing it different than Germans or Swedes.
Brexit ain’t making it easier either, since London is the place to go to take people’s temperature, pre-applying to YC.
PS. “the US economy isn’t as good as it used to be” - the US economy is in better shape than the EU’s.
🇫🇷 Tesla is not a car company, it is a software company.
Software will play a central role in the upcoming car revolution. Unless legacy carmakers quickly reinvent themselves, new players will fill the gap to provide an OS and an app ecosystem. link
🇸🇪 Adolphus, Ek, and Combined Arms: A deep dive into Spotify’s strategy of manoeuvre warfare
🇫🇷 Andreessen-Horowitz firm has developed a sophisticated podcast system. Its mission: becoming the go-to place to understand the future. The secret: great programming and a carefully crafted production process. link
🇪🇺 Time for a new social contract for the gig economy. In Europe, that is.
🇫🇮 Reflections on 3 years of finding a product/market fit inside a venture fund
🇩🇪 9 Fundraising Tricks From a Professional Fundraiser
Euro bits
🇩🇪 Amazon has officially started operations at its first European Amazon Air hub, based out of the Leipzig/Halle Airport in Germany. The new facility spans 20,000 square meters and will host two Amazon-branded Boeing 737-800 aircraft, bringing the company’s total operational air fleet to more than 70 aircraft.
🇫🇮 Helsinki Relocation Package - We will provide selected applicants with a free 90-day relocation package for the entire family. We’ll arrange your housing, daycare, schooling, everything you need – the real deal, just like a Finn.
Hold your horses, it’s a PR stunt. :-)
🇫🇷 Netflix is testing a programmed linear content channel in France. The channel, called Netflix Direct, will be available to Netflix streaming subscribers and will provide content from its existing streaming library in a linear format, much like cable and broadcast TV stations do.
🇩🇪 TXL closed this weekend.
🇸🇪 Spotify hints at subscription podcast service.
🇪🇺 Wealthy countries are falling short on a decade-old promise come due to ramp up climate finance for the developing world, according to a semi-official report released Friday.
Well, we have the covid situation we have to deal with now.
🇳🇱 World first: Dutch brewery burns iron as a clean, recyclable fuel.
This is a big deal as an alternative to fossil fuel - apparently the post burn rust can be regenerated straight back into iron powder with the application of electricity, and if you do this using solar, wind or other zero-carbon power generation systems, you end up with a totally carbon-free cycle.
🇪🇺 Electrified cars outsold diesels in Europe for the first time last month
🇬🇧 Bentley (owned by VW) will ditch internal combustion engines and its entire range of products will be fully electric by 2030.
🇸🇪 Volvo Trucks will offer a complete heavy-duty range with electric drivelines starting in Europe in 2021. The vehicles, weighing almost 50 tons, are expected to have a range of up to 186 miles. The electric vehicle space is growing quickly.
Slides of the week
1. Unbundling Harvard. Yup.
2. Investor engagement in climate change keeps rising
Reads
A response to a critique of Aggregation Theory, and a defense of debate on an Internet devoid of gatekeepers link
A Twitter Conversation About Early Liquidity vs Holding
Who are the top syndicates on AngelList right now?
23 ways on how BuzzFeed turned a profit in 2020
Tesla Will Leave 'Skateboard' Behind & Move To Structural Battery Packs
ESPN announces hundreds of layoffs
Warner Bros. forced Johnny Depp to resign from his role in the Fantastic Beasts franchise days after the actor lost his libel suit against The Sun tabloid.
NYT hits 7 million subscribers as digital revenue rises
Peloton is worth more than Ford.
Happy Sunday!
Thanks for reading 🙌
Created every Sunday by @drnovac.
Please share it with your networks and encourage your colleagues to sign up here - thanks!
Feel free to reach out if you have any questions, comments, feedback, or if I can be helpful.