current situation

#242

Author

Dragos Novac
September 21, 2025

Hey there,

Welcome to Sunday CET!

This weekend - US business in UK, undisclosed $100M+ deals, China does self driving in Europe, big tech dealings and H1-B became expensive. And a whole lotta more - thank you for reading, hit reply with your thoughts and comments.

Enjoy,
Dragos

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Signals

Interesting deals

🇫🇷 10% (cashback platform) - seed
🇩🇰 Go Autonomous (AI-powered automation software for ecommerce) - series A
🇮🇪 Miru (graph-native investigation platform) - seed
🇳🇴 Nolla Health (AI-powered dermatology tools) - seed
🇬🇧 Rulebase (AI co-workers for financial services) - seed

What would you invest in?

I have picked three early stage, seed level startups from Europe with intriguing odds for growing. You're the VC - who gets your term sheet?

Last week’s results:

🟨🟨🟨⬜️⬜️⬜️ 🇭🇺 Deligo​ - three second AI checkout tool (32%)
🟩🟩🟩🟩🟩🟩 🇸🇪 Monoscope - AI workflow for strategic planning of big teams (55%)
🟨⬜️⬜️⬜️⬜️⬜️ 🇬🇧 Viable​ - intelligent cash flow mgmt platform for e-commerce (13%)

Let’s see your say this week - click on the link of your choice below - we’ll add the result next week.

What startups would you invest in?

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Market talk

The Yankees did London 

London was full of American tier one people this week - tech CEOs, politicians and whatnot, as the American president wanted to reaffirm the UK-US ‘special relationship’ while the Brits were happy to oblige with a royal treatment. Lots of related public protests downtown btw, even though the action happened mostly in Windsor.

Alas, the American interest is a UK highly dependent on the US, while the Brits badly need any support they can get for a delicate economic position, trying to find a way to a sustainable growth path - yet to be determined as the country has been a constant mess after divorcing from the EU. And so, the US can conveniently play the sugar daddy role - and rightfully so opened up the wallets.

The visit’s bottom line was £150B in American investment to the UK, most of which, £100B, a Blackstone commitment over the next 10 years across private equity, real estate and credit. FT has a good number breakdown - they are tentative and estimative, nicely rounded to be marketed for a special occasion. Beyond the nice, beautiful number - building rapport and nurturing relationships, and I would bet there were some informal discussions about how American companies could use a softer approach from local regulators, as all those fines and restrictions keep piling up. Which should be interesting to follow given the UK, under Starmer at least, seemed to favor closeness to the European way of doing things, which is anti American when it comes to tech. We shall see it shortly, I reckon.

As an anecdote, as I happen to be in London this month, I chatted with people in the tech community, who, to my surprise, were not very happy about it, fearing that UK startups will be sidelined as a consequence - with talent, funding, and contracts flowing to large American firms instead, in a market that’s already super-competitive, particularly for finding and retaining tech talent. Why open doors to billions if the talent and contracts will walk straight out the same doors - you can’t compete with American salaries, see the recent OpenAI/Meta salary fight over Swiss engineers, or Cohere’s CEO saying he’s happy to pay extremely high salaries in Europe. Not a black and white and rather longer discussion here, of course. Two other interesting notes with what I heard:

i) becoming highly dependent on US tech, UK risks being a consumer market rather than building its own major companies and infrastructure, just like Europe.

However…
… when you need infra and knowledge you gotta start from somewhere in order to be in position of dreaming to become independent. The UK is not in that position today but has started heading into that direction and the American support is handy.
… having the right legislation providing incentives to create value locally is actually more important than worrying about sovereignty, and let’s just say that legislation is not ideal.

ii) the UK also risks transitioning towards a more transactional society favouring an individualistic approach (just like in the US), rather than a one centered around community and its common purpose, and more socialist-like if you want, again, like the whole Europe is driven. Again, open-ended, with a complex anthropology context applied to the times we live in.

Alas, Trump also would like to see more MAGA adepts, hence his narrative against immigrants in the official overall UK visit conclusion - which I found rather odd as this is a national matter, right? But it is fitting to the current extreme nationalistic and rather divisive sentiment situation from both the UK and Europe, fertile for the American doctrine.

What do you guys make of it?

Conversation starters

  • Tech M&A market de-frosting Workday acquired Sana from Sweden for $1.1 billion, or roughly 13% of Workday’s 2025 revenues, and it also launched an AI agents platform aligned to a whole value chain ecosystem from a core building engine to a smart distribution play including also portfolio customers - Workday has an active corporate VC arm. Fwiw, Sana has also been doing enterprise AI agents ever since they became a thing a year ago, and their work will probably be incorporated into Workday’s engine development. Besides the cross-selling and product line augment, Sana will also contribute to the revenue line with its own customers, which is not negligible. Seems like a good fit, reasonably priced and strategically sound, at a decent return for investors (i.e. 2X up from 2024) - EQT, Menlo and NEA are the A, B and C leads, respectively. Btw, Workday has already been a strategic investor in Sana since 2023 - they have an equity stake in other European startups too.

  • TIL - Things I Learnt Black Forest Lab actually closed a series A deal led by a16z against a co-founder level ownership (i.e. 20-25%), never made public, albeit rumoured twice in the media last year (1, 2) - that’s from an interview with a16z’s Anjney Midha, who sits on BFL’s board (Mistral’s too). BFL made a reportedly $96.3 million ARR number for August 2025, and expects $300 million in fiscal 2026.

  • More Chinese in Europe Uber did a deal with Chinese autonomous vehicle startup Momenta for testing robotaxis in Munich, Germany starting in 2026. As a side note, the Chinese business in Europe is another sub-plot worth following since China is de facto at war with Europe via its proxy Russia - how will that impact doing business going forward, as Europe is doing less and less business with Russia and China will likely be next on the list?

  • Founder exit Will Shu, the founder of Deliveroo will leave the company after the acquisition by DoorDash is finally completed. You know that all VCs are chasing him for getting their money for his next thing, right? Very different situation from when he started Deliveroo and no VC wanted to talk to him because he was an underdog without the ‘right pedigree’.

  • Revolut is killing it They did £1.01B in revenue in the second quarter of this year, up from £694m in the same period last year - traded at $75B earlier this year. Revolut and Stripe are going to be flagship financial institutions of this century, just like HSBC, Barclays, Societe Generale or Deutsche Bank have been in the past 50-100 years.

  • Largest purchase of a natural resource from space Finnish tech firm Bluefors, a maker of ultracold refrigerator systems critical for quantum computing, has paid $300 million for purchasing tens of thousands of liters of Helium-3 from the moon through Interlune, an American company developing space-based resource extraction. Helium-3 is extremely scarce on Earth but abundant on the Moon, where Interlune plans to harvest it using lightweight, energy-efficient lunar extraction systems.

  • Local national brand vs regulation A hedge fund says that it’s not viable to run a large international bank from Switzerland due to new strict capital proposals, and that would put UBS with no other realistic option but to leave the country. UBS, which is the biggest Swiss bank and a heavy contributor to Swiss federal and cantonal tax revenues, is reportedly weighing the possibility of relocating its headquarters from Zurich to the United States.

  • Resizing to fit opportunity SoftBank Vision Fund is considering cutting as much as 20% of its staff - namely about 50 out of 282 employees as of March 2025.

  • VCs doing tech Insight Partners’s security breach from a year ago impacted almost 13,000 people - it was really serious.

Big tech

  • AI eating lunch Duolingo’s stock price is getting crushed lately, due to investors fearing that AI translations will eat the company’s lunch. There’s a lot of substance here, as an anecdote, for my Spanish lessons I switched entirely from Duolingo to Chatgpt, which is doing a great job. Interesting to follow how Duolingo will react, I like the company, founded by smart European dudes btw.

  • Glasses as the new device Meta launched smart glasses with AI apps and assistants - their first consumer-ready smart glasses with a built-in display, seeking to extend the momentum of its Ray-Ban line. The demo failed because they DDoS-ed themselves, which you don’t see very often at this level, alas this involuntarily turned into good marketing juju for Zuckerberg, as anybody building stuff will empathise. Post mortem was good too.

  • Long Google Google Cloud is quietly stealing share from AWS and Azure, as this week signed up Lovable and Windsurf, part of a push that now has it working with nine of the top 10 AI labs and 60% of generative AI startups.

  • Gap narrow Open AI last traded at $350B and the valuation for Elon’s work for Grok is getting closer - xAI is raising $10 billion at a $200 billion valuation now, just weeks after securing $10 billion in debt and equity at a $150 billion valuation. Anthropic is at $183B.

  • OpenAI doing hardware OpenAI has reportedly done a deal with Luxshare, an India-based iPhone assembler, to produce a future OpenAI device - important to note that it’s India, not China, which has made American hardware producers highly dependent in the past twenty years, and which also opens the question of being able to produce at scale the new gen devices elsewhere. OpenAI’s is targeting a late 2026 launch - besides poaching Apple’s suppliers, it also poached more than two dozen Apple hardware veterans this year with million-dollar stock packages and promises of faster, less bureaucratic work.

Policy

  • Draghi calls for pause to AI Act to assess the risks - a kind of post-ante funny position, while beneficial, it’d be hard to conceive in spite of Draghi’s influence because the EU leaders don’t really get the tech business, and act accordingly.

  • The French Constitutional Court backed officially the digital services tax - the so-called Google Tax which Trump claimed to be discriminatory against American tech. The decision will make more difficult an overall tech agenda negotiation for Europeans with the American counterparts.

  • There are significant job cuts announced in Germany's industrial sector - just recent announcement add up to 125,000 industrial job cuts in 6 weeks. It's not just auto, the complete industrial base is crumbling due to economic slowdown, faltering exports (i.e to China/US due to tariffs), overcapacity, the costly shift to EVs amid Asian competition and high energy costs, which are roughly double the US rates → stopped buying cheap gas from Russia & shut down nuclear plants.

  • Big tech is super panicked as from this week on, the American employers will have to pay a hefty $100,000 fee for new H-1B visa applications - that’s non-US people with technical expertise wanting to work in the US. The likes of Microsoft, JPMorgan and Amazon, for example, have urged their H-1B and H-4 visa employees to promptly return to the USA before the September 21 deadline. The fee is a huge jump from the current $215 lottery registration fee, the program is capped at 65,000 new visas annually, plus an additional 20,000 for foreign graduates with advanced degrees from U.S. universities.

  • Kiss the ring: Silicon Valley CEOs struggle to respond to Trump’s involvement in their businesses.

Closing notes

  • new AI tool can predict a person’s risk of more than 1,000 diseases

  • AI agents can pay each other in stablecoins

  • Albania puts AI-created minister in charge of public procurement, addressed the parliament as well.

  • president Trump suggested that the US government should revoke the licenses of TV networks that are overwhelmingly critical of him.

  • going out on a Friday night in San Francisco - from robot boxing matches and trivia nights to AI-judged contests where tech bros are rated on their designer fits. Back in my day, we would do pub crawling or clubbing.

  • in memoriam - how Robert Redford got U2 drunk.

That’s all folks, have a wonderful week!

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