Upside Ep #59 — UK at a Crossroads, AI Surge, Defence Tensions, H1B Shock

Yes we're European VCs so YES we're talking AI and defence! But there's still more of the pie to eat, so dig in.

02:00 🇬🇧 UK in the doldrums
* Little to no growth (1.5% vs US 3.8%).
* Inflation stubborn at 3.8%.
* 130k jobs lost since last budget.
* Housing, Heathrow, HS2 — stalled megaprojects.

06:30 📉 Structural weaknesses
* UK pensions: only 4.4% in UK equities (vs 50% in past).
* FTSE = $2.8T — smaller than Apple alone.
* R&D spend at 1.7% vs US 3.5%.

10:00 🚀 Reasons for optimism
* Revolut hits 70m users, Canary Wharf HQ, £3bn UK investment.
* UK AI leaders: Wayve, ElevenLabs, Synthesia, Cleo.
* Nvidia building Europe’s biggest GPU cluster (120k Blackwells by 2026).

13:00 🤝 Trump visit & £150bn US deal
* Breakdown: £90bn Blackstone, £22bn Microsoft, £5bn Google, £1.5bn Palantir, £3.9bn Prologis.
* UK pledges $80bn procurement from US tech/defence.
* Historic scale, but execution challenges loom.

18:30 📝 What the UK must do — 5-Point Plan
1. Regulatory bonfire
2. Pension capital unlocked
3. Energy independence
4. Planning revolution
5. Startup Central (“29th Regime”)

24:00 🌍 H1B debacle
* US slaps $100k fee on new H1Bs (was $1.5k).
* Big Tech shrugs, startups squeezed.
* Europe’s opening: 24h visas for £100k+ roles could flip the script.

28:30 🤖 AI Corner
* Nvidia invests $100B into OpenAI — vertical integration play.
* Cohere hits $7B with AMD deal; Modular raises $250M to break CUDA lock-in.
* DeepSeek achieves GPT-4-level performance at 1/20th cost.
* JLR cyberattack halts production for 3+ weeks; systemic risk exposed.

37:00 🛡️ Defence Corner
* Russian drones breach NATO airspace — first NATO shots fired.
* Copenhagen airport shut, Polish & Baltic incursions.
* NATO launches Eastern Sentry, Europe boosts spend to 3.5% GDP.
* Defence unicorns rising: Helsing ($12B), Quantum Systems, Tekever.

45:00 💸 Deals of the Week
* nScale: £1.1B raise at £3B — Europe’s newest AI datacenter unicorn.
* Ōura: $875M raise at $11B valuation.
* Aerospacelab: $110M for satellite constellation.

On today: Dan, Mads, Lomax, Andrew.