Upside The Seed #17 - AI in real money, Identity politics is dead, M&A up, Bitcoin up. Humanity down.
This week in European VC - Dan and Mads explore the real revenue generated by AI startups, not hAIpy at all, no one went to COP29, the EU startup passport is arriving much sooner than anticipated, Germany's instability as an opportunity, AI is programming, insights from a recent MIT report on material science, and the global and local economic ramifications of Trump's administration.
The average time for an AI startup to hit $1M in revenue is 11 months.
COP29 has seen a lack of attendance from major world leaders.
The EU startup passport aims to simplify regulations for startups.
Germany's government collapse could lead to more European reforms.
AI is 25% of coding at Google.
It's proven - AI significantly enhances productivity in material science.
Trump's election results. His focus on economic issues won over identity politics.
Increased M&A activity in 2025. Bitcoin up. IPOs up. Climate and humans be damned.
Startups will find new opportunities in this changing global landscape.
Chapters
00:00 AI Startups: Real Revenue vs Hype
05:47 EU Startup Passport: A New Era for Entrepreneurs
11:17 AI in Code: The Future of Software Development
17:04 Trump's Election: Implications for Global Economy
22:32 Opportunities and Challenges for European Startups
Show Notes and links
Dan - AI start-ups generate money faster than past hyped tech companies -
https://www.ft.com/content/a9a192e3-bfbc-461e-a4f3-112e63d0bb33
Average time for an AI company to hit $1m is 11 months. SaaS is 15.
Cursor grew from $4M ARR to $4M/month in less than 12 months. AI is not just hAIpe - https://www.arr.club/signal/cursor-arr-at-50m-growing-crazy-from-4m-in-april
AI vs SaaS Growth: AI start-ups reaching $30 million in annual revenue do so in about 20 months, five times faster than earlier SaaS firms.
Global Demand: Roughly 56% of AI companies’ revenue comes from international markets, with substantial purchases in regions like Singapore and Iceland.
Notable Examples: OpenAI, ElevenLabs, and DeepL are examples of successful AI companies. OpenAI’s ChatGPT became the fastest-growing consumer app, generating $3.6 billion in annual revenue despite high operational costs.
COP29 - none of the big wigs are there - Forty-eight fewer heads of state are addressing COP29 than last year. Xi Jinping and Joe Biden—presidents of the two biggest oil-producing countries - won’t be there. Russia not there. What will this mean for startups?
https://www.bloomberg.com/news/articles/2024-11-11/cop29-negotiators-agree-on-some-rules-for-global-carbon-market?sref=KkPzpZvz&srnd=homepage-americas
New UK target for 81% emissions cut by 2035 https://www.bbc.com/news/articles/cx2ny8zndpxo
The new EU Startup passport
Announced by Ursula von der Leyen - EU Commission President
German Government has collapsed
Scholz calling for new elections
AI Now Writes Over 25% of Code at Google -
https://uk.pcmag.com/ai/155094/ai-now-writes-over-25-of-code-at-google
Google Confirms Jarvis AI Is Real by Accidentally Leaking It -
https://gizmodo.com/google-confirms-jarvis-ai-is-real-by-accidentally-leaking-it-2000521089?
Artificial Intelligence, Scientific Discovery, and Product Innovation* by Aidan Toner-Rodgers† at MIT
https://aidantr.github.io/files/AI_innovation.pdf
- AI automates 57% of idea-generation tasks, allowing scientists to focus on evaluating AI-suggested compounds.
- It reduces repetitive, low-value research directions.
- AI-assisted researchers discover 44% more materials, leading to a 39% increase in patent filings and a 17% rise in product prototypes that incorporate these materials.
Trump globally. Trump administration to the UK and Europe - what next?