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Hello,
Welcome to Sunday CET.
Blue Monday tomorrow aka the most depressive of the year - hang in there. 🤗
Take care,
Dragos
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Market talk
🇬🇧 This week the British government announced an AI plan that - no more, no less - would inject AI into the veins of the nation. Beyond the silliness of the PR, somewhat fitting the historical non-popularity of the PM, I think this is really cool for the Brits and hope it will work out - if it does, it will create not only tangible economic results but also tremendous spillover effects and lessons for the entire European continent. Using tech in a smart way is probably the best lever for unlocking quick growth and AI provides an unique context today for building something meaningful across multiple economic areas.
It is also really important for the local community because it gives people hope, which is the biggest drug out there, and provides some sort of assurance that, after all, there may be a tiny light at the end of the tunnel, in spite of an overall shitty situation and an ever bad management of the country. Not least, this hope is also reinforced by the fact that Matt Clifford is the de facto author of the action plan - i.e. having our own guy conceive the plan must put some weight on bettering the odds of politicians accomplishing something, or anything really, net-net positive in the years to come.
A few quick notes:
This is not the first governmental effort to jump on a trend and get the UK be “the AI leader” - less than a year ago the former PM had a somewhat similar approach, with the precise objective of having AI set to contribute billions of pounds to UK GDP. So why is it different this time?
Moreover, who is accountable for making this plan happen? Matt is just a consultant, not responsible for implementation - so who is the go-to guy accountable to unleash AI across the UK? Have I missed something, is there a project manager responsible for it, or a minister, or the PM himself, perhaps? No guy in charge means the odds of success diminish drastically.
How do we know this is working to begin with - what are some specific KPIs to improve or hit for calling it a successful plan? How do guys ensure they’re on the right track?
What is the timeframe till we see some results? A year? Three? Twenty? It looks like many recommendations are rather infrastructure plays, and capex can take a lot of time to produce ROIs.
In layman terms, how one would describe an ideal case whereas the Brits are AI leaders - that’s btw a really non-committal, generic term loved by politicians and hated by OKR people. Infra translates into AI-related IP patents? Computational power? Number of governmental employees replaced by AI?
Is there a money making side of the equation for the action plan, given that tech commercialisation happens mostly in the US today? And, more directly, how does that impact a founder operating an AI startup from the UK? Startup people are like kids, have basic needs - need access to talent and a huge, liquid market. Brits, and Europeans in general, make for great scientists, are well trained and super innovative, but lack a market to properly reward with economic rents against those - that is why we see now an exodus to US for much higher salaries or other geographies providing more value for the money. How would that be reversed, if at all, by this action plan?
Just some food for thought - what do you guys make of it?
🇳🇴 Storebrand, which was founded in Norway in 1767 and is the largest local private investor, announced that will move all its operations from Norway to Sweden.
it’s an exodus trend from Norway - Nordea and Alfred Berg (owned by ABN AMRO) both announced moving their funds out of Norway late last year.
reasoning: stricter local regulations.
🇫🇷 Facebook sez: Mistral is peanuts to us. The eye test looks like it, right?
🇬🇧 Barclays is shutting down its startup accelerators.
🇩🇪 Zalando is still around - in 2024 it did €15.3 billion GMV, of which €510 million in adjusted EBIT.
🇬🇧 Nothing also put out some numbers as it’s looking to tap the private market for more money: 7 million devices sold and 2X revenue in 2024 to over $500 million.
🇧🇪 Bankers in Belgium will now have to swear an oath in front of the country’s market officials in which they promise to act with honesty and integrity - whatever happened to lead to this, I wonder.
🇪🇸 Barcelona has became a hub for Israeli spyware startups - good weather and tax benefits compensating to Israel becoming more restrictive in granting licenses to export spyware to other countries.
🇪🇺 More continental matters:
after Facebook last week, Google announced EU regulators it won't add fact-checks to its search results or YouTube videos, despite requirements from a new EU law.
the EU is also re-evaluating its position - this is brewing into a big US vs. EU thing, as the big American tech is all aligned behind Trump particularly to have a front man fighting against the EU’s love for the American business.
cheap gas vs. you leave our tech guys alone? Or no more chips, perhaps? Greenland with sugar on top?
bonus link: the European Union has fined tech companies more than $30 billion in total, and the US government has encouraged it.
here’s a funny one, btw - after having been fired by Ursula last year, the local I-hate-America champion Thierry got employed by an American company.
Europe’s largest pension fund (ABP from Netherlands) sold its entire $585 million stake in Tesla because it was unhappy about Musk’s remuneration package.
if they had held, their Tesla stake would now be worth 2X today, namely over $1.1 billion.
that loss is just $500 million worth of evidence to Elon’s stock brand damage, I guess.
the gift that keeps on giving - to avoid paying billions of euros in EU pollution fines, groups including Volkswagen may have to buy carbon credits from electric vehicle rivals such as China's BYD.
Europe sits on €33 trillion of household savings in the bank - not a bad idea for the Union to unlock it and build some housing with it, for example.
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Also notable
💲 Cheat sheets:
🇫🇷 Alex put out his yearly notes on the French investment market in a deck, and did a 20vc event at Station F to present it.
🗣️ The best 30 timeless company-building insights of 2024.
🤡 Sonos parted ways with the CEO who oversaw the new version of its mobile app last year - it was a major business f-up.
🤯 Microsoft is using Bing to trick people into thinking they’re on Google.
🚀 Blue Origin, the space company owned by Amazon’s founder Jeff Bezos, launched its New Glenn rocket into orbit from Cape Canaveral this week.
there was some space news from Europe this week too as a French crew raised $178 million for operating space infrastructure on a lease basis.
well, kinda from Europe - the French have long moved actually to the US, where the business is.
💲 Commodity suppliers competing on price:
Google bundled Gemini into Workspace plans, alongside Gmail, Google Docs and Google Sheets, while simultaneously raising the price for those plans by $2 a month - that’s a much lower number than the $20 a month Google was charging for Gemini as an add-on feature.
in contrast, Microsoft sells its AI Copilot service based on how often they use the service, rather than using a flat monthly fee. Microsoft is still charging the flat fee for customers who want its full suite of AI features available in Office.
that’s long tail GTM though, where I’d guess neither of the two is exactly top of mind for SMBs, and the AI product is a rather nice add on top of the generic office suite.
😱 Delta Airlines announced a lounge meter for its premium waiting areas - will limit the number of annual visits to its Sky Clubs lounges for passengers with premium American Express cards.
💸 A biotechnology startup working to bring back animals from extinction by using DNA and genomics has raised $200 million at a valuation of $10.2 billion, more than six times its valuation just two years ago.
👨 Robin launched a newsletter covering European deeptech.
🇷🇺 FYI, while Trump would like Greenland at a good price, Russia would like a new iron curtain in Europe - a new division of the continent between Moscow and Washington, and says that there is nothing to discuss with London or Brussels.
for the young ones, this is what it means, and if you want to see what could look like, you just go to this address.
🏦 Who paid taxes in America in 1929?
🍍 British restaurant charges £100 to add pineapple on pizza.
🧊 How do igloos keep people warm?
That’s all folks, have a wonderful week!
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