Hi there,
Welcome to Sunday CET. It’s been a while, I missed you.
The highlights from today’s edition:
the radio silence
interesting early stage deals on the continent
algos doing startup investments
Enjoy,
Dragos
Updates
For the new subscribers, Sunday CET is a weekly email sent every Sunday and covering stuff I see interesting in the European startup ecosystem. There was no email for the past month or so, and some regulars reached out to ask why the radio silence - well, life happens and you deal with it. But I feel like sharing more about it. NB: boring personal stuff follows - skip to the next section if not up to it:
- I moved to Switzerland. Various reasons for that - one being that living in central Europe is closer to what is going on on the continent and important for everything I am involved in. Jokingly (or not), the way the world looks like now, we will all end up moving to Switzerland eventually.
The moving process combined with a few personal problems limited my free time and availability. I simply ran out of bandwidth.
- besides Sunday CET, I also put Nordic 9 on hiatus - well, kind of. That means we’re not adding to the database all the dealflow from Europe any longer - just a selection to what I think it is worth tracking. Overall, my objective remains to have Nordic 9 as one of the best data sources for Europe (as one of our customers put it), it’s just that it’s not going to be the most comprehensive one in Europe. I was very proud of that, tbh, but ego is bad for business, retrospectively it was kind of dumb to put so much effort to track as much deal data as possible. Which we still do for 30 countries or so.
To give you an idea of the workload, with our scarce time and little money, we usually track 30-40% more dealflow than what the standard mainstream whole-seller would have in their DBs, as we’re much better than them at capturing the zeitgeist at the edges (anybody can track the press releases, right?). This is a difference that may not make sense for many people, but it can become one hell of a drug when you do on the cheap a better task than other setups that cost millions to build and maintain. I kinda got carried away by this.
Where do you draw the line in order to be pragmatic though? At the money - the business model justifying such an effort on constant basis is not really interesting for me to scale. Data is a commodity and it’s really boring to track in order to sell it as SAAS. And lately I haven’t been too focused on the business side of it anyways, and if I am being honest with myself, it’s mainly an opportunity cost rather than the $ per se.
- related to that, I’ve had a few consistent discussions to sell N9, which gave me a great chance to understand how others look at this kind of opportunity - how to go about building such a product and extracting value out of it. I actually find fascinating the whole process of comparing my work and vision to other ones that are just in love with other people’s work, or value the software tool, or just the data, or the media or just the revenue side of it. Nothing’s finalised in the end and we’re still running Nordic 9 on our own and making a great use of it - I am a heavy user of N9 myself for other projects so I’m pretty invested in it anyways.
- over the summer, I have also restarted doing startup coaching and a bit of board work, and also re-kindled the Tech Tapas events from a year ago that ultimately ended up in Project Arrow. Which, again, it can be resource consuming at times but talking to founders is fun and more satisfying than gathering and selling data. We’ll see how that goes, so far so good, that work hasn’t been affected.
- oh, not least important, as you can see, I switched back to Substack, mainly because it is super easy to use and it’s the devil I know, as opposed to start learning a new tool. Vero, which I used for the past year, was driving me crazy, and I eventually let it go, not as easy of a process as it seems as I needed a whole day for working into it.
So there’s that. Back to the regular schedule now.
Interesting deals
🇨🇭 nobank, building a crypto retail investment platform, raised seed.
🇩🇰 Turis, digital B2B wholesale and insights platform, raised seed.
🇬🇧 Masref, the Swiss YC alumni based in Oxford and building a business providing saving accounts for the middle-class in distressed economies, raised seed.
🇸🇪 Attini, developing a serverless deployment framework for Infrastructure as Code designed for Cloud Engineers, raised $400k pre-seed.
🇸🇪 Ripe, a B2B sales leads startup, raised $2M pre-seed.
🇵🇹 Rely.io, developing a reliability intelligence platform that productizes Site Reliability Engineering, raised $2M.
🇮🇪 Yonder, consumer neo-insurance startup, raised $2.6M pre-seed.
🇪🇪 Koos, doing an API-based HR tool for bonus management, raised $4M seed.
🇪🇸 PandaGo, operating an electric vehicle B2B rental platform, raised $4.6M.
🇬🇧 Mailchain, developing the communication layer for Web3, raised $4.6M seed.
🇳🇱 Timberhub, YC alum and digital marketplace for timber trading, raised $5.6M seed.
🇩🇪 35up, API-based platform helping e-commerce assets with cross selling, raised $5M.
🇩🇪 Everstores, which does SAAS for ecommerce, raised €8M series A.
🇫🇷 Javelot, which does smart storage of agricultural materials, raised $10 million series A.
🇸🇪 Blowfish, doing fraud detection for web3 wallet transactions, raised $11.8M seed.
🇫🇷 Bricks, operator of a a real estate fractional investment platform, raised $13 million.
🇬🇧 Toqio, selling a white label SAAS-based financial platform, raised $18M series A.
Watercooler talk
🇪🇺 Oh, the EU Tell me you have no idea what you’re doing without telling you have no clue about what you’re doing - after one year of struggling to figure out how to launch and operate an investment vehicle set up to fund startups in order to achieve “tech sovereignty”, the EU hired a financial advisor to make the investment decisions for them. So now, funding startups has become a process involving 3 institutions and designed to take 5 months - the EIC Accelerator makes the selection process, the EIB the due diligence and Alter Domus decides who gets the money, and will likely sit on the board. Please note that none of them is a professional investor.
This is some 3D chess played right there - in layman's terms, the EU politicians who want to be VC investors outsourced their decision in order to pass the responsibility onto a third party, as they’re afraid of getting bad reputation if/when startups fail. It kind of adds a special flavour to the sovereignty objective, doesn’t it? Exciting times for the investors community - this is what it’s like doing business in Europe in a nutshell, folks, fight me on this.
🇫🇷 Bonus - here’s a lil’ European cultural nugget coming all the way from France. Apparently there’s an NGO dedicated to protecting the French language that sued a number of French government startup orgs over their use of English words in their names. Behind the NGO is a retired IT guy who worked for Carrefour.
🇩🇪 Porsche, the German status car maker, went public this week in a $72 billion deal, which makes it the second largest IPO in German history. Traders said some investors who bought Porsche’s mother company Volkswagen as an IPO play (traded at about the same value) could be unwinding their positions and switching into Porsche, undermining Volkswagen's aim of bumping up its capitalisation by showcasing the value of just one of its brands. The market giveth, the market taketh away.
🇨🇳 Geely bought a stake in the British car brand manufacturer Aston Martin. Step by step, the Chinese have consolidated their position in Europe:
they control Volvo in Sweden, where they spun off a new brand called Polestar.
control the British Lotus, acquired in 2017 for 1 billion.
fully own the producers of the London black taxicabs
have a 10% stake in Germany’s Mercedes, and control half of Smart together with Mercedes
it invested in Volocopter, the German aircraft manufacturer that’s raised half a billion from all sorts of external investors,
also invested down the value chain where it controls Carbon Recycling International, an Iceland-based manufacturer of methanol from carbon dioxide emissions.
🇫🇮 Finnish gaming studio, Black Block, which is building a new GTA-like web3 game, put out their pitch deck as they’re looking for funding.
🇬🇧 Sifted, the new media outlet backed by VC money, says its debut conference from next week has sold 85% of its tickets, that’s roughly 1500 people. Quick back on the envelope calculation: if 70% of them paid on average 300 quids that should be about 300k in ticket revenue. Add to that the 10-11 sponsors chiming it, and they get a 800k-1M revenue line. Not bad for a startup that just raised 5 million. The downside is that events are a huge resource drain - but if you do media, you have to do events, if you want to provide good returns to your shareholders in 5 years from now on, that is.
💣 End of the world, and we know it Watching these days the UK’s struggles with the instability of an incompetent leadership pushing having to save the country from the edge of collapse, was like reading the The Big Short movie script in real time. Times are shitty and we’re living history as we speak - Putin’s war declaration from Friday is the beginning of a period that will be much worse compared to the past few years, which were just a preview. You will soon join me in Switzerland, I am telling ya! :D
PS. Simple game theory reasoning for why Putin’s only choice is engaging with US at this point.
🤖 Google Ventures shelved its investment algorithm, that was a gatekeeper for making their new investments. This is an ongoing discussion I’ve had with multiple investors looking to go beyond their customised CRM - investment early stage, where everybody is crowding nowadays, is about making qualitative decisions in a pre-defined universe, most of the time subjective and seemingly irrational, a behaviour that is hard to be proxied by software. Yes, software can help with many supporting roles and provide competitive advantages if you’re smart about it, but doing “AI” (basic machine learning stuff if we’re to be honest) just because it sounds cool and makes for a PR edge ain’t going to cut it particularly at early stages, when good ones pay for conviction not for history data.
🤡 Tim Cook was in Europe this week, namely in the UK and Germany, where he met with some of his staff and key advertising resellers (according to the PR) and pushed the plans for building a manufacturing site in Germany (according to gossip on the street).
🦾 Sequoia Capital hired a fifth person in their London office - a German who worked as a consultant for BCG for two years, has graduated school with a Master Thesis in product analysis in 2019 and has a GMAT score of 710. Consultants are going to consult.
🩸 SoftBank has laid off 30% of its Vision Fund staff, or around 150 people.
Closing notes
🎹 Startup ideas: Piano-building was once one of the country’s largest industries. Today, only two companies remain in business.
♟️ Magnus Carlsen, the world chess champion, says cheating is bad in chess but won’t comment on the specific oponent he’s suspecting of doing so because he’s not allowed. Weird - how do you cheat at chess anyways?
💭 Cultural differences are real - Americans are fake and the Dutch are rude (and stingy) link
🤷♂️ Is Gen Z salary-sharing on TikTok making a difference? link
🔫 Is AI art a ‘toy’ or a ‘weapon’? link
🏈 NFL in London is becoming a neglected niche.
🚓 How is China removing illegally parked cars link
☕ Drinking coffee and Muslim culture link
Thanks for reading 🙌
Created every Sunday by @drnovac of Nordic 9 with weekly notes and observations from the European startup ecosystem.
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