Upside #53 - EU vs US Wealth Creation, Energy Breakthroughs, M&A Boom Means?

For the real news behind the headlines affecting European venture.

Hosts: Dan Bowyer & Mads Jensen, with Joe Knowles from Smedvig Ventures

(01:15) US vs. Europe in Wealth Creation
US dominates wealth & compounders due to internet hyperscalers.
Europe: strong talent, growing startups, but weaker late-stage funding & exits.
Pension fund restrictions and lack of capital allocation are core structural issues.

(12:10) AI Race & Europe’s Challenge
US likely to win again; Europe risks falling far behind.
Strategic gaps: compute, energy costs, slow policy response.

(13:05) M&A Boom
H1 2025: ~$100bn in deals (+155% YoY), led by Google–Wiz ($32bn).
Hot areas: AI code gen, security, vertical apps.
Europe well-placed in application-layer M&A and AI-enabled services.
Exits recycle capital → critical for VC ecosystem health.

(21:21) Defence Tech Awakening
Porsche & Deutsche Telekom launching €500m fund; Lakestar raising €250m.
Cultural shift in Germany: mainstream corporates backing defence/dual-use.
Small monetarily, but signals a tide change.

(31:21) Energy & Batteries
Breakthroughs: lithium recycling (97%), sodium-ion at $10/kWh, EU gigafactories planned.
Europe must cut energy costs (4x US levels).
Nuclear, deregulation, and better storage key for AI competitiveness.

(35:06) AI Corner
GPT-5: Faster, unified model, free to ChatGPT’s 700M users. Incremental but strong in coding.
Perplexity vs. Chrome: DOJ may force Chrome divestiture; Perplexity rumored buyer (PR stunt?).
Economics: OpenAI at $500bn valuation despite $5bn losses; Anthropic ARR exploding ($1bn → $5bn in 7 months).

(42:15) Chips & Geopolitics
US restricting Nvidia chips to China; Trump proposes tariffed exports.
Europe’s Chips Act stuck with outdated tech; Intel project canceled.
Urgent need for “Chips 2.0” and partnerships with TSMC/Nvidia/ASML.

(48:03) Closing Notes
Italy’s record H1 (€655m raised).
Europe’s momentum building across defence, energy, and venture.