heat pumps



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New design, new mail provider and a whole newsletter wrapped up and ready to send. This week we talk about heat pumps, the French ChatGPT and Chinese in Sweden.


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10 things you need to know

  1. The most expensive series A in Europe last quarter - along with the most interesting ones in the UK, Germany, France, Nordics and the rest of Europe. link

  2. Good money is made with boring investments. Germany’s family owned Viessmann Group sold its heat pump business in a €12 billion deal made with an American company - that is 17X the Viessmann unit’s 2023 EBITDA.

    Rationale In total, the two companies will generate a revenue of more than €15.5 billion, which would put the Americans in a strong position to outperform competition all across the globe - subject to German authorities approval of the deal, bien sûr.

    Money The heat pumps represented the largest money generator segment of the Viessmann Group (70%), which produces other un-related sales of €1 billion with around 4000 employees.

    Demand Europe makes efforts to meet climate and energy security goals by relying heavily on heat pumps to replace gas boilers. Locally, in Germany there’s a new law to be adopted in 2024 forcing the use of heat pumps in properties.

    Market Europe’s heat pump market reached a record 3 million units sold in 2022 (+38% yoy) getting at a total number of heat pumps installed in Europe to around 20 million, which provide heating to around 16% of residential and commercial buildings. The current European market size is estimated at €4.5 billion and is projected to grow to €13.6 billion by 2027.

    Food for thought Did the Germans sell because:
    i) they didn’t want to compete anymore - down the market Asians compete aggressively on costs.
    ii) bigger is better, as they’re a stronger group + get the American market entry.
    iii) cash is king in shitty macro - 80% of the purchase was paid in cash.

  3. Heat pump startups from Europe That sizeable TAM is also addressed by venture money allocators. Here’s a quick look at some of the active assets and their backers:
    🇸🇪 Qvantum Energi - raised $44 million from Climentum Capital, IMAS Foundation, Gullspang
    🇳🇱 HeatTransformers - raised $16 million from Energy Impact Partners, Fair Capital and ENERGIIQ.
    🇬🇧 Mixergy - raised $16 million from EDP Ventures, Nesta, Oxford Science Enterprises, Kiko Ventures, Foresight

    🇨🇿 Woltair - raised $16 million from Kaya VC, Movens, Inven, ArcTern Ventures
    🇳🇱 Triple Solar - raised $12 million from DOEN, APG, Enfuro
    🇩🇰 Lun Energy - raised $11.5 million from Lowercarbon Cap, MCJ Collective, Norrsken
    🇳🇴 Heaten - raised $10 million from Azolla Ventures, Nysnø, Shell Ventures

    Bonus: Other up and coming startups:
    🇳🇱 Quatt
    🇫🇷 Equium
    🇳🇴 Winns
    🇮🇪 ActionZero
    🇬🇧 Barocal 
    🇸🇪 Drem
    🇬🇧 Futraheat

    🇩🇰 Bodil 

    source: nordic9

  4. The Italian tech ecosystem - good background

  1. April numbers for Euro VC deals


    434 deals | $4 billion value


    530 deals | $4 billion value [March 2023] 

    430 deals | $2.7 billion value [February 2023]

    476 deals | $3.8 billion value [January 2023]


    492 deals | $8.1 billion value [April 2022]

    536 deals | $6.1 billion value [April 2021]

    Top regions

    Nordics & Baltics - 93 deals | $589 million

    UK - 87 deals | $882 million

    DACH - 86 deals | $894 million

    France - 78 deals | $755 million

    Top cities

    🇬🇧 London - 64 deals | $690 million

    🇫🇷 Paris - 39 deals | $370 million

    🇩🇪 Berlin - 27 deals | $265 million

    Active investors

    🇫🇷 Kima | 🇬🇧 BGF | 🇬🇧 Octopus | 🇫🇷 Partech | 🇬🇧 Ascension | 🇸🇪 Pale Blue Dot 

    🇺🇸 Christopher North | 🇫🇷 Laurent Ritter | 🇩🇪 Julius Köhler | 🇩🇪 Nicolaus Schefenacker | 🇺🇸 Walter Kortschak | 🇩🇪 David Nothacker

    source: nordic9

  2. Afforestation carbon credits in numbers - understanding the market

  3.  Why you should raise from a great investor as early as possible - Follow-ons and Reserves. Btw, I always advise founders that if they’re to choose between highest company value in a term sheet and great quality investors at an inferior number, they should always consider the latter. Great investors are hard to find.

  4. Cheat sheets:

    - Q1 series A deals in Europe - what you should know.
    - 50 SAAS deals made in Europe by the angel investors in Q1

    - 200+ early stage deals in Europe in Q1 2023 - AI, deep tech, web3, climate et al selected from 1500 startups that got funded in the first three months of the year.

  5. Founders toolbox:

    how to calculate the value of your startup

    find investors' sweet spot

    deal with investors’s feedback

  6. Euro intel This week’s intel include:
    → pre-seed rounds for no code tools, marketplaces, neobanks, ghost kitchens
    → Euro AI startups recommendations
    → who is Sequoia of climate tech in Europe
    → … and a whole lot more. High signal, zero noise - get it too.

Also notable

🇬🇧 The Brits have a plan and figured they need to make the London Stock Exchange more attractive to companies, as the number of listed companies has fallen 40% since 2008. The problems are multiple, well known and not necessarily all related to the Brexit idiocy while the improvements include giving company founders greater voting rights over ordinary shareholders. The market makers seem resistant to change though:

“The whole thing is a degradation of hard-fought protections for shareholders, who are providing their capital to support companies.”

The document with the whole set of changes is available for consultation and feedback until the end of June.

 Noventiq  intends  to delist its shares from the London Stock Exchange and re-list on New York’s Nasdaq via a SPAC acquisition.
 There is little value in hosting the world’s VCs [in London] if they are not creating UK-headquartered and UK-listed businesses.
 Was the Deliveroo IPO really a flop?

🇫🇷 The French have a plan too - they would like to put France and Europe back in the running in the frantic race for artificial intelligence, currently dominated by the United States and China. Back? 😄 So they started working on a ChatGPT competitor - whatever happened to the ‘we saw an opportunity in the market and went for it’? Usually startups are made because folks want to make shitloads of money and/or create meaningful stuff in their lives, not to make Macron proud or tickle the Euro bureaucrats ego.

Putting the fun aside, the project has little public details - it is called Mistral and is developed by Guillaume Lample, a research scientist in Facebook's AI division, and Arthur Mensch, a former research scientist at Google's DeepMind. At least they’re looking for funding in the private market, Lightspeed is said to already be in the lead with an $80 million investment round that could value Mistral at $200 million - other names involved are Eurazeo and Xavier Niel.

🇪🇺 Back in the race But where has Europe been in the past years? Here are the top 5 countries worldwide that have the most patents filled around AI technology:

🇸🇪 Sweden is a Chinese hub in Europe China-based Putailai will invest $1.3 billion for building Europe’s largest factory for manufacturing anodes, a crucial part of the batteries that go into electric vehicles, in Sundsvall in central Sweden. Northvolt, the Swedish startup that has become Europe’s leading battery manufacturer, will be the first main customer.

Sweden has become a European hub for different parts of the EV value chain because of its green electricity abundance. China, on the other hand, is a strategic technology investor in the country - other assets in Sweden include Kedali, near Northvolt’s first gigafactory in Skellefteå (casing producers), Senior Material in Eskilstuna (separator film) as well as Volvo and Polestar, both EV makers owned by Chinese.

💰 ZIRP effects Amazon ‘aggregators’ like Thrasio, Razor Group and Perch, that would become the next consumer product conglomerates, like Procter & Gamble or Unilever, have raised $16 billion – mostly debt - in the past couple of years.

Now they’re either facing bankruptcy or they will buy one another - there are so many aggregators and investors speaking with one another it’s difficult to predict which companies will emerge intact and which will get washed out. There’s a ‘Game of Thrones’ vibe around this entire industry.


🇩🇪 German entrepreneurs known for selling at loss VC-backed quick ecommerce assets, are at it again: some raised for ghost kitchens (en vogue startup idea during covid) and others raised for allegedly cloning a German health startup.

🛎️ Building great companies is hard - concerns over cash burn rate, a seemingly narrowing liquidity runway, and a stock price that’s dropped nearly 86% year-over-year, make for a tricky situation for both Lilium and its existing investors.

🛴 Tier put itself for sale after working with Rothschild to raise hundreds of millions of pounds of additional funding, efforts which did not produce satisfactory terms. Translation: we’re outta money, we cannot raise, we need an out.

Anecdotal - while I am a frequent customer of on-demand scooters in different cities, I have never used Tier. I have a bunch of apps and I am usually brand agnostic, whichever is close works for me. But I’ve never had to take a Tier. What are you guys doing?

What scooters brand do you use?

Lime  |  Voi  |  Bolt  |  Tier  |  Dott  |  Other  |  I don't

Login or Subscribe to participate in polls.

🇬🇧 UK media group Reach, publisher of titles such as the Mirror and Express, blames Facebook changes for sales decline. Because blaming the distributor is easier than looking at the quality of the product or at the GTM.

That’s at least a decade old problem for the media that figured social media companies are free content distribution channels, without realising that there’s little to no economic alignment between the two. And Facebook had huge distribution power - complaining now and not having done anything about it for so much time just shows the quality of media heads operating business.

Related: TikTok has begun allowing publishers to sell ads alongside their videos while keeping half the revenue. What will happen when TikTok will change strategy in a few years?

🇮🇪 Temu, one of China’s largest online marketplaces owned by the Pinduoduo shareholders, sets up a base in Dublin:

Pinduoduo is still based out of Shanghai while Temu is headquartered in Boston. Temu’s teams in Boston and Dublin mostly perform functions in tax, marketing and legal matters, according to its employees’ LinkedIn profiles.

If you don’t know what Temu is, imagine if Amazon and TikTok had a baby.

🇬🇧 UK antitrust regulators said they are investigating Adobe's $20 billion takeover of Figma, which the US Justice Department previously sued to block. If they deny the deal, will Adobe join Microsoft accusing the UK being closed for business, as it’d done after its own $69 billion transaction didn’t go through?

💲 The US Securities and Exchange Commission has paid out its largest-ever award to a whistleblower, almost $279 million - names were not named for obvious reasons. To get paid, whistleblowers must provide information that leads to an SEC enforcement case of more than $1 million.

Tech stocks are not where the market is at

Since IPO all these companies have been growing their revenue yet the market doesn’t show any love.


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Closing notes

🤖 Quantum computing could break the internet - they call it Q-day. That is the day when a robust quantum computer will be able to crack the most common encryption method used to secure our digital data. Anybody old enough to remember Y2K?

⚽ The football agents are unhappy because FIFA is breaking EU law by looking to cap fees that agents can earn from player transfers. FIFA’s response:

The football transfer system is an ecosystem with human beings at its core. It is not comparable to a 'market' in an economic sense.

That’s another way of saying f-off, so the agents complained to the EU.

🇮🇹 Italy wants to build the world's longest suspension bridge. The Mafia and geography might make that difficult.

🇩🇪 Evidence that Germany is a country stuck in a different decade.

🏎️ Ferrari said orders are backed up into 2025 due to huge demand - last quarter they shipped 3500 cars, almost half of them to Europe.

🇸🇪 What’s the resemblance between Spotify’s Daniel Ek founder and a “sinister Scandi” from a movie? There’s a quiz for that - grown up stuff.

🤔 When is the first time you first felt old?

✋ The ‘Stop’ from the start of the Where is my mind song by The Pixies is unintentionally deactivating alarms set on Google’s Pixel phones.

🎶 The Rock & Roll Hall of Fame named its newest inductees, including Willie Nelson, Missy Elliott, Kate Bush, and others.

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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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