Howdy,

Sun’s already up, Aurora pics checked (the most powerful solar storm in more than two decades), Denver just beat Minnesota, coffee’s hot and plenty - ready to rock and roll!

Welcome to Sunday CET people, the weekly digest with what I find interesting in the lil’ startup world from Europe.

Big thanks for reading, let me know what you make of it.

Dragos

Next dinner

Next month we’ll organise a new dinner meeting in London. Here’s what we want to do:

• an invite-only event with the objective of matching ambitious founders with open-minded investors, and having them build future business relationships.

• it is not a pitching event but rather an informal setting over a dinner table (think salon), on the premise that people do business by getting to know each other in a relaxed manner as opposed to going to ‘fast food’ pitching gigs.

• as such, the gathering is highly curated and limited to 15-20 founders and investors.

• I already have a long list of folks interested - please let me know if would like to be considered. Priority will have our customers, either N9 ones or the founders I work with over at PA.

Market talk

Interesting deals this year

As the hot deals from the winter are slowly surfacing to the public (dully noted on our weekly intel briefings), this morning I had a quick look at what’s been interesting in the early stage names backed in Europe lately. Some to keep an eye on:

• Arcane - AI copilot on top of a marketing automation platform

• Buddies - consumer social network

• NovaMea - electrochemical systems for energy storage

• Nustom - end-to-end software development service

• Opper - API for Gen AI

• Photoncycle - alt tech for PV electricity storage

• etc etc - will put a big list in a cheat sheet next week, there’s quite a few in spite of the market slowing down. Reminder, we produce intel with this kind of deals every week, you just need to become a customer to get it.

Does Mistral need a new CEO? 

• here’s the latest on Mistral: 6B post, DST in, Softbank out. For now.

• btw, Softbank just led Wayve’s 1B this week, which tickled a bit the Brit ego - they could use some good news, overall mood is quite grim in the UK and not only if you step outside the VC bubble.

  • Softbank’s gotten nothing to show in Europe in five and half months, other than a D1 extension with Travelperk.

  • also rumoured to look at Graphcore these days, available at a discount as the PE passed it away - one day, you’re a working space visionary, and the next, an AI and chips wannabe hero, I guess.

• back to the French, it ain’t over for their series A yet, there’s a reason for why media leaks exist.

• the real talk is that Mistral is at a scaling stage that may need a seasoned CEO at the helm to transition to a decent 21st century tech company and have a standing chance against tier 1 competitors.

  • that’s conventional VC thinking - an ‘Eric Schmidt for Google’ moment-like which may be harder to sell because of local pride and the usual gibberish that makes France a special place to do business in.

  • gotta be American, right?

  • just bringing in a seasoned American CEO would likely add an at least 20-30% mark-up to Mistral’s fundraising deal.

• here’s a fun what if exercise for you:

  • just imagine for a second, say, Thierry Breton being offered and accepting a CEO role for running Mistral.

  • great? Meh? Who says no?

  • don’t think Breton per se, but his profile - he is sold by the media as the local pride able to handle business with American capitalists (rather antagonize, but that’s for another time), and Linkedin says he is a seasoned CEO since he’d led Atos and Orange for many years - both big French companies, with sizeable turnover, international dealings and exposure. Besides dude was professeur at Harvard, so he has got to be qualified for a CEO job at a tech startup, right?

  • uhm, sure, maybe? Possible but not probable. Another way to look at it is that what looks good on paper (or social media for that matter) and/or is considered locally as an European business success may be different than the real life. Fact is, with all respect for TB’s experience and as impressive may be for some, Mistral’s direction requires fitting for a top tier American enterprise performance, even though it’s now a French company.

  • assuming one would like to maximise shareholding value asap, that is - the business blueprint in US is different than what you can see in Europe, and that is why it’d be optimal for Mistral to get an operator with enterprise experience from the other side of the pond.

• and yes, of course, it’s a hypothetical making for a nice weekend thinking exercise over a cup of coffee. Mistral may be at an inflection point but adding a CEO supervisor for Arthur and co doesn’t guarantee future success, and there are cases with young European founders taking their startup across the chasm to successful IPOs and beyond - see Daniel Ek or Daniel Dines, both still acting CEOs for the startups they founded. Rather singular ones though, wouldn’t you say?

• Mistral is a worthy VC asset in Europe, arguably the most interesting the continent has ever produced out of the startup world. But the devil is in the details, as always.

Cheat sheets

• interesting early stage startups from overlooked European markets

• most promising 250 AI startups (and their backers)

• under the radar startups (updated every week)

• AI legal startups - link

• American investments in Europe - H2, H1

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Also notable

🇪🇸 The Spanish government rejected the $12.4 billion merger between BBVA and Sabadell, the country’s second- and fourth-largest banks, due to ‘an excessive level of concentration that would introduce an additional potential risk to financial stability’.

• fragmentation it is then, great news for neobanks, btw.

🇬🇧 Soho House is still not making money but membership up 17% year-over-year to 198,000 - Q1 revenue at $263 million.

• SH is the ageing arbiter of young, cosmopolitan, vaguely creative cool founded in London as a modern twist on the city’s private clubs.

🇨🇳 More Chinese EV in Europe:

• ZEEKR, the EV brand owned by Geely that IPO-ed this week, plans to enter Europe and Latin America this year and is already selling cars in Sweden and the Netherlands.

🇮🇪 Amazon will launch a new dedicated website for Ireland in 2025 - so that users will switch from the UK one and be able to avoid additional customs charges and currency conversion fees.

🇸🇪 Most of Spotify’s employees are located outside Sweden, due to high local taxes, low-quality schools and Stockholm's housing shortage leading to a skill exodus, whereas even Swedes choose to move abroad.

🇬🇧 The times we live in, the UK edition:

• 70% of Millennial and Gen Z UK entrepreneurs are eager to start businesses outside the UK and almost half (46%) are still grappling with the complexities of Brexit.

• some PR to counter - £2 billion worth of tech investments in the UK this week. (the Tories are toast though)

🇩🇪 The times we live in, the German edition:

• protesters clashed with police in Germany after attempting to storm the Tesla factory near Berlin - they claim Tesla's plans to double the size of its factory might damage a nearby forest.

• otoh, the climate-skeptical right-wing political groups are on the rise and put the Greens on course to lose a third of their seats at next month’s European parliamentary elections.

• all this while Russian invading Ukraine triggered an energy crisis that exacerbated a cost-of-living crunch in Europe, who had barely recovered from the pandemic.

• the crunch’s gotten to a point whereas the soaring cost of kebabs became a public debate with the chancellor Olaf Scholz, asked to put a government subsidy programme in place.

• “I pay €8 … speak to Putin, I want to pay €4” → the Germans would do anything for their cheap kebabs, in a country worth €7B of kebab business.

• (French and Italians are kinda in the same boat, btw)

• as a German friend put it to me eloquently over a beer the other day: we’re poor + not able to produce competitive value in the foreseeable future + don’t like immigrants + violence is a reflection of all this.

• thoughts?

Current situation

That’s the aggregated market value of the top regional tech players and no, don’t blame the tech regulation for Europe being irrelevant - for almost two decades, Europe's digital economy wasn't regulated. And still, the EU wasn't able to produce companies like Microsoft or Apple.

Food for thought - how’s the green pie going to evolve now that the EU wants to protect it from American/Chinese tech companies while making the whole market worse for everybody else, already struggling?

Mo’ Sundaying 

🚀 Uber estimates a $1B run-rate for its Uber One membership, wants to add more perks → the path to a super app.

🖖🏻 Tim Cook is said to work on a CEO successor that’s currently Apple's head of hardware engineering.

🇬🇧 SXSW will do London next year, somewhere around Shoreditch.

🥐 Why France is finding vegan croissants hard to stomach - sacrilege.

🌮 Taco Bell will finally come to Germany - hopefully cheaper than kebabs.

🇪🇺 Europeans can't afford the US anymore - there’s a massive retreat of European economies compared to that of the United States.

🇩🇪 If America is the land of convenience, then Germany is the land of inconvenience culture.

🇪🇺 Startup investing in Europe vs in the US in a nutshell: UK is the best option but post Brexit it's become a nightmare - wtf moments.

👓 Payment market report - cash payments are still king yet on a declining trajectory and the consumer demand for BNPL reached an all-time high. (scroll for interesting country breakdown)

💲 Companies can’t issue debt fast enough amid mixed signs of where interest rates are headed next.

🏀 The NBA is looking for a new media deal that’s at least $76 billion over 11 years - 2.5X the league’s current deal.

🤑 Hollywood Accounting is the greatest form of legal money laundering ever invented.

🚑 In US, hospitals are refusing to do surgeries unless patients pay fully in advance - those who can’t come up with the sums have been forced to put off procedures. Not pretty.

🤯 MG got banned on Facebook, Insta et al for nudity or sexual activity - or a humble reminder that social media companies are your discretionary identity owners and your content is not yours or never has been to begin with.

💪 A middle-aged American venture capitalist who’s also Paris Hilton's brother-in-law bought a spot as a substitute on a second-division struggling Portuguese soccer team.

🇪🇺 The Eurovision live tweeting was more interesting than anything you will read in the media or even the show per se.

That’s all folks, have a wonderful week!

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Created every Sunday by @drnovac of Nordic 9 with weekly notes and observations from the European startup ecosystem.

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