The Next Generation of European Tech Funding: Scale-Ups

Transcript

The Next Generation of European Tech Funding: Scale-Ups

Europe has already developed and produced multi-billion dollar companies, and there's no reason that past is not prolonged. We're about to witness the largest transmission of wealth in European history. So overall it will be 18 trillion and just for Europe 3.6 trillion of euros moving from boomers I would say to next-geners. We are late and behind by a mile relative to the U.S. and China for different reasons and are actually losing ground. Certainly AI may go down in history as the greatest let's say technological transition or wave in history and by an order of magnitude. I'd say though that Europe has opportunity well beyond AI. Sam Altman announced that he's going to be building 30 gigawatts of data center capacity. One large or medium-sized nuclear plant is only one gigawatt. So that means 30 equivalent nuclear power facilities in order to power just Sam Altman's data centers.

Hello I'm Tom Parker and welcome to the next five podcast brought to you by the FT partner studio. In this series we ask industry experts about how their world will change in the next five years and the impact it will have on our day today. This is the second episode of a two-part special. In the first we looked at the European tech startup environment. Today we're exploring Europe's growth stage tech landscape. The funding available, challenges ahead and how Europe can build more billion dollar companies. I'm joined by three experts ready to discuss what the next generation of entrepreneurs, tech leaders, talent and financiers can expect from the European tech industry over the next five years.

So let's meet our guests. First up we have Luca Ferrari co-founder and CEO of Bending Spoons, one of Europe's largest tech unicorns. Thank you for having me, it's a pleasure. Hilary Gosher, managing director of Insight Partners, a global venture capital and private equity company that invests in high-growth tech, software and internet businesses. Hey Tom, thanks for including me and hi everybody from New York. And Tommaso Fassati, head of wealth management Italy at BMP Powerbar. Hi Tom, it's great to be here. Well it's a pleasure to have you all here.

Let's get straight into the topic of funding. Late stage financing plays a critical role in the growth trajectory of technology scale ups, particularly as they transition from early innovation phases to market dominance. I want to explore how tech companies move from startup to scale up and how they find capital to support their growth. Luca, I'll come to you first. There may be some listeners out there that don't recognize Bending Spoons but I'm certain that they'll have used some of your apps. There's Komoot, a hiking app, streaming platform Bright Cove, WeTransfer, which I certainly couldn't do my job without, and Note App Evernote. That's just a few of the 50 startups that you've bought since you launched in 2013. And I'm deliberately missing one out, your most recent acquisition that I'm sure you can tell us all about. But perhaps before we get there, can you start by giving a brief overview of what Bending Spoons does and importantly your funding journey?

Sure, we are a fairly unusual company so I guess it warrants an introduction. You could say we're 25% private equity and 75% a tech company. Like a private equity firm we focus on acquisitions as a key driver of value creation. But unlike a private equity which typically operates through funds and so buys to sell after 3, 5, 7 years, we buy off our balance sheet. I've never sold a business nor do we intend to so we are forever owners and operators. And also unlike a private equity firm, the overwhelming majority of what we do is developing and refining technologies and user experiences. Most of us are software engineers, AI researchers, product designers. So the way we do what we do is we acquire a digital technology business with substantial unexpressed potential. And then we roll up our sleeves and try to bring a radical transformation across the board. And if we do it right, then we generate a lot of value.

We started in 2013 and for the first probably 5 years we self-financed through the reinvestment of our own earnings. And then in or around 2018 we started using bank loans to accelerate our growth. That has been a critical component of our financing mix since. For now we work with pretty much every large bank globally, including institutional debt investors from all around the globe. On the equity side of things, we haven't raised a whole lot of equity. Whereas debt, and just to give you a sense of the scale, we have raised over $5 billion in debt, so it's quite substantial. On the equity side of things, we didn't raise any significant equity until 2023. And then since 2023 we have raised some equity, probably about a billion in total. Mostly secondary financing, so it hasn't really funded the company. It's gone to exiting shareholders. But probably about $400 million have gone into actual capital increases, thereby contributing, although to a lesser extent, to our growth.

Toward the end of October, we announced two pretty substantial, albeit separate, financing events. On the one hand, we raised $2.8 billion in debt from most large international banks. And then, more or less at the same time, we also raised $700 million in equity financing at an $11 billion valuation. There are two from a bunch of world-class investors from all around the world. Why, you may wonder? Well, to finance our, certainly our indie activities, but primarily, as it's more capital intensive, our acquisitions. We did announce, around the same period, that we signed the acquisition of V-Mail, and more recently the acquisition of AOL. We expect both to close before the end of the year.

Well, Tommaso, let's bring you in here. Can you give us some context as to where funding can be found in Europe for companies at scale upstage? And are there any in particular that you've noticed stepping up to the plate in, say, the last five or 10 years? Europe's funding landscape has grown massively over the last 10 years. I had the privilege to run the innovative company's coverage for our European banks in Europe before joining the wealth management activities. And we've seen this from two perspectives. Luca mentioned it. Of course, the companies, just in terms of number, we've seen an eightfold increase from 2015 to today. Back in the day, you had 400 growth companies in Europe, and we now have close to 3,500. And also in terms of sectors, we were used to more B2C businesses or retail as well as the social media application. And today we're way more in the B2B business models and deep tech that represent 75% of the overall funding. Just to mention a few, of course, Bending Spoon and the fantastic job that Luca and team have done. You have Mistral in France, of course, in the Buy Now, Pay Later in Sweden. You have Klarna, Revolut did fantastic things in the UK, Personio in Germany, and also ASML in the Netherlands. Keep in mind that you already have two companies in Europe that are valued more than 100 billion.

So this is on the company side. Then the investor. That was a great run on the investor side as well. Not just in terms of number, just to give you a sense, you had in 2015 2,000 investors in the VC growth ecosystem. Today, there are 4,000. They were primarily specialized growth and VC funds in the US, and I'm sure Ilari can discuss about that. And today you've seen, we're seeing pension funds, insurance companies, sovereign funds, whether in Italy, in France, or in Germany, the BPI, CDP of this world that are stepping into the game, and family offices. So we see that families are more and more investing in the growth ecosystem, and this is for two main reasons. First one, you get next-geners into the game so the wealth is transmitted to more digital native people, and also the perception of risk is evolving, adapting a bit the risk return approach. You might see risk from the perspective of investing in a company that might not deliver, like a startup that might fail, but you can also see risk as underestimating a technology that could make an entire industry obsolete. And this is where relevant European banks like BNP Paribas can play a key role to simply connect these capitals with the innovation.

Well, I want to go on to the US because in episode one, we touched on the difference between capital access and the overall funding environment in the US compared to Europe. So Hilary, I want to bring you in here. According to Atomico's European State of Tech 2024 report, only 4.1% of European companies are able to reach $15 million of funding rounds compared to 8.3% in the US. There are challenges in Europe that perhaps don't exist stateside, and I don't want to make this into a US versus Europe conversation, but I do want to explore what the US is doing well and what Europe can do to compete.

Thank you, Tom. Yes, there is a very large pool of capital in Europe for early stage investing. When you see that, just as Tommaso has said, in terms of the number of companies that are being funded in Europe and the number of startups that exist, I think that ecosystem of early stage capital is very deep. As Atomico mentions, the dearth or the gap exists in the next stage, the true series A, the 20, $50 million series A or series B that we see a lot of in the US. And a lot of the reason why there are so many larger funds in the US is because historically US pension funds have allocated significantly more of their overall allocation to private equity and venture. And we've just seen a large number of growth equity firms emerge with multi-billion, multi-million dollar funds.

Inside ourselves, we spend a lot of time investing across the ecosystem. We believe that stage is not a strategy. We believe that sector is a strategy. So we invest only in tech, but we invest from series A and seed all the way through to IPO. And our fund is 11 billion today, 12 billion today. And you see a lot of emerging funds that are equally that size who can write 50 or $100 million checks.

But if I step back and I say, well, what can Europe do to close the gap? I think you're already starting to do that. I think in May this year, the EU launched the Choose Europe to Start and Scale Act that is still under conversation, but definitely looking to clear the way for private funds and pension funds, public-private partnerships to step into some of that gap and fund some of these larger series A, series B rounds.

Yeah, absolutely. I want to look a little bit more about the funding gap because while the volume of capital to European growth stage companies since 2015 has tripled, there is this £375 billion funding gap. And so why does this gap exist and how can it be plugged? Tommaso, let's go back to you on this and then we'll go to Hilary.

The gap is not just financial, it's a structural gap. We have deep pool of capital in Europe, but they're fragmented by language, by culture, by regulation. And we think there are many things to do. We might start from some simple ones. First is to mobilize dormant capital into productive equity. And we believe that the asset management consolidation across Europe will help to develop stronger expertise in the growth ecosystem and also having scale. And the recent acquisition that BNP Paribas made of AXA Investment Manager, building the second largest asset manager in Europe, goes in that direction.

And secondly, but this could be the first one, have a genuine single capital market across Europe that simply allows a company from Milan or Paris to raise capital in Berlin or Amsterdam as easily as in New York. Pension funds need to play their role as well. So we could take inspiration from what happened in France with the TB Initiative that simply asked large insurers to invest part of their assets under management in the VC or growth ecosystem. At the same time, family offices require training and understanding of the risk that can be hidden in investing in the VC or growth ecosystem. But we strongly believe that with the new generation and the transfer of wealth to the new wealthy Europeans, this will accelerate the development of the investment in this specific vertical.

Yeah, Hilary, Tommaso mentioned there about the pension funds playing a part. We touched on this a little bit in the first episode about the ESIRA or ISIRA, the sort of policies that were brought in the US in the 70s that can be partly responsible for the strength of Silicon Valley. Let's touch on that part of it, but also perhaps you can bring in other areas of where we can really plug this funding gap compared to the US.

Yeah, Tom, that's a great point. ISIRA does allow investors—specifically allocators, LPs, pension funds—to invest tax free and so they can take returns. And as we give DPI, those are tax free for certain ISIRA listed companies. And that I think is very helpful because it allocates, it encourages those allocators to allocate more money to the private equity and the venture capital space. But I don't think that that is the entire story. I think that capital flows to opportunity and I don't think it's a bad thing that US capital is flowing to great opportunity in Europe. And I think it supports the European ecosystem and therefore also encourages additional European capital flow—not just pension funds, but as Tommaso said, family offices are investing, private wealthy individuals have access to these kind of assets through one of our portfolio companies, Moonfair, which is a German-based aggregator of capital pools and investing. The governments themselves are providing subsidies. There's access to credit markets that they weren't before. You know, one of our portfolio companies, Ailey Labs, just raised a round of both equity and credit. It was a much more efficient way to manage their cap table. But, you know, that credit line comes from a European bank. And so I think that the companies can avail themselves of multiple sources of capital and they're already starting to do that. And I think capital flows where there's opportunity. And, you know, we've made three investments, just some that I can cite, one out of the UK, Omnia, which is an AI procurement platform. We did Filigran out of France, which is a cybersecurity company. We've just done Flank. All of these are co-investors with Europeans. So I do think that there's a great kind of US-European partnership as we think about funding the next generation of growth equity.

Brilliant. Thank you so much, Ailey. Now, Luca, you touched on it earlier. In your opinion, what do you think Europe can do to better support growth companies? I know that your growth story has been slightly different to others. But what would you say Europe can do as a support structure for most tech companies that will be going in this growth stage?

I suspect I have a bit of a contrarian view on this problem that most people listen to Hilary. I think she may agree with some of what I'm about to say, but she'll be the judge of that. But I think often I hear people say we need more capital. Why isn't Europe deploying as much capital as the US is or on a per company basis or in aggregate? And I think that's mostly the wrong way of looking at the problem because people who deploy capital essentially seek returns. There may be marginal considerations, but essentially they seek returns. And there has never been, certainly not in the last 30 years, major problems in investing in Europe. It's not perceived as a geopolitically dangerous zone or anything like that. So as long as the world at large has ample capital, the reason why we don't see as much investment here as, say, in the US is because the companies we have on the whole are not as appealing as investment opportunities.

I think the better questions we need to ask ourselves is, how do we get more high potential companies and how do we get them to a point where people are interested, whether they're based in Canada, the US, China, or France, to deploy 50 million, 200 million into making them even more successful companies? So the question is, how do we attract some of the best entrepreneurs, investors, inventors, engineers? When you look at it from that angle, I think the answer is relatively straightforward. The solution may be difficult or painful, but I think to me the situation is clear. Europe is perceived as a much less appealing place to do business than the US. I hear it all the time when I talk to top entrepreneurs, top investors from anywhere in the world, certainly outside of Europe, they perceive—and again, not everybody, but a majority perceive—Europe as a place of heavy-handed regulation, complicated, unnecessarily complicated bureaucracy, generally a certain level of unfriendliness toward capitalism and business, a greater level of wariness than, say, you see in North America. And it's not terrible. It's still a nice place to do business, but in a highly competitive world, even if you're only 20% less appealing, people will tend to go elsewhere to do it.

And so I think we need to make changes that will make Europe at least on par, ideally better, because now we have to catch up relative to the US, and I think it starts with aggressive deregulation, understanding that regulation should not concern itself with fixing or preventing somewhat mild corner cases if it means making 99% of normal cases more friction-full, annoying, costly. Regulation should not be about scaring away innovation and risk-taking. It should really focus on covering the really severe problems and letting things go the way they should for the most part. So I'd love to see our governments and the EU invert course completely like a U-turn, rather than launching new and new acts across the board like anything under the sun being regulated more, always with the explanation that that will make things simpler somehow, which I never understood. I think they should really invest into removing as many of the laws we have as possible and making Europe an incredibly appealing free market where to do crazy, ambitious investments and company building.

I'd also like to see a more uniform market. We've done a lot in that regard, but ultimately we still have so many languages. I understand this is difficult to do with the cultural heritage we have, but it would be great to see Europe transition to say English as the fundamental language like Singapore did. Singapore had plenty of languages, Chinese, Malaysian. They decided, okay, we got to do English here because otherwise we'll never be an appealing international hub for investment. They've been prospering, not just for that reason, but that's one of the reasons since.

I'd love to see more uniform regulation. I'd love to see a more centralized power because as long as our national governments retain 80% of the power, ultimately you're not going to make Europe one big union where people can invest and operate somewhat seamlessly. I'm glad you said there was a unified language proposition there because just like any Brit, I'm embarrassingly bad at speaking any other language than my own. But Tommaso, let me bring you in here because I want you to add some points on the back of Luca and then let's go to Hilary.

Sure, and Luca raised an interesting point on how do you make European growth companies more appealing, but for sure there is a huge part of responsibility that comes from the ecosystem. And we've seen a great agenda that was drawn by Mr. Draghi recently just saying, okay, now it's time for a U-turn and to simplify things. Just to give you some simple ideas, we love the fact that you can have a simple and single company identity across all over Europe like the Inc. in the U.S. Luca was a bit more drastic having a single language right away and this is an interesting one, of course. But the single market remains a first vital step and maybe on the deep tech ecosystem we might adapt a bit the conversation as we know that we need huge capital in an early stage phase and the risk return approach of European is not always that sensitive in this phase and then the revenue generation starts a bit further on in the development of the company. It's exactly the contrary of what the Bending Spoon has demonstrated through the years but we are in a deep tech interesting breakthrough phase and we need to analyze this one and maybe adapt a bit the VC ecosystem structure, maybe blending a bit more public and private capital and maybe Hilary can comment on the U.S. IRA initiatives or the investment made by the public sector and we strongly believe that clusters on specific verticals can be a huge accelerator of this process.

What do we mean by cluster? It's simply putting large manufacturers, startups or scale-ups, VC, innovators and university on, I would say, robotics in Germany or mechatronics in Italy and simply accelerating learning curves. By creating and building up this ecosystem, you might build the global champions as Bending Spoon is doing.

Can I interject very quickly because you mentioned that I suggested some more drastic measures. Not that I enjoyed it. Maybe my nature, I think a lot of entrepreneurs like to be a bit bolder but I think here it starts with diagnosing the issue. It's not that Europe is doing great and we're talking about how do we go from 9.5 out of 10 to 10 out of 10. We are late and behind by a mile relative to the U.S. and China for different reasons and are actually losing ground. So we're not going to catch up at all by making incremental minor tweaks. We'll just die of a slow death. So it's either, I really suggest we take a clear stance. We could die of a slow death and it could be a relatively pleasant dying for a while or we could try to catch up and really give ourselves a chance to win and be a leader but that requires, I'm absolutely certain, requires drastic measures and we have to go way beyond the interests of individual countries or subgroups. It has to be a top-down, aggressive, ambitious plan whether it's what I suggested, other things are mixed but it's certainly not in minor interventions that we fix the problem. There's certainly drastic language there so I like it. It's sort of a Braveheart moment.

Tomas, did you want to jump in here but I do want to get to Hilary as well.

So yeah, just a very quick point. This is a great point raised by Luca. My point is, shouldn't we be smart on where to cooperate and where to compete? We're lagging behind on the hyperscale clouds or some Gen-AI infrastructure but we still have strong industrial capabilities, fantastic engineers and I'm sure that Luca can discuss about the talent he has at Bending Spoon in Italy or in Europe and maybe from there embedding a technology that we weren't able to create ourselves but just to capitalize on it and try to make global champions.

Brilliant. Henry, come in. So following up on what Luca said, while it does require some drastic top-down initiatives, I've never known innovation happened by committee and that's kind of what happens in Brussels which is committee and you really do need to sweep aside some of the structural impediments as both Luca and Tomas said that does hold Europe back. One of the things that I would say hasn't been picked up on that is important is the ability for employees to make money through ESOPs and VESOPs. The reason that you've got such a fluid capital pool in the US and you attract so much talent is that when people join startups, they know they're taking a risk, they know that those startups may fail and that they'll be out of a job but there's no stigma to labor movement. There's very free labor movement. If it doesn't work in one company, I go to the next company, I take my skill set and I develop from there but when I do work in a company that wins, I end up being the person who then starts the next business and I think about what we call Silicon Slopes which is the Salt Lake City area. That was never historically a big startup cluster as Tomaso talks about in that language but there were a couple of initial companies where entrepreneurs were either in the valley and then went back home to Utah or started in Utah and that has versioned an entire ecosystem of entrepreneurs. I think Qualtrics, I think Pluralsight, there's multiple companies that have come out of that ecosystem. You see the same in Stockholm, frankly. If you think about Klarna, if you think about Spotify, there are so many companies that have come out of Stockholm that creates the next generation of entrepreneurs. Those same entrepreneurs are the ones right now that Loveable is feeding off the back of but that's all based on the ability of employees to one, have freedom of movement and mobility and two, to profit and benefit from the success of those companies and I do think there's an impediment that neither of my fellow panelists talked about around making sure that if capitalism isn't to be a dirty word then capitalism needs to be spread and everybody needs to benefit from the fruits of it.

I think that's one of the things that does distinguish the U.S. is that stock options don't get taxed fully. I've got companies in Germany where we're bending over backwards to give VSOPs and all sorts of things that try and make it tax free and because people get taxed on notional future value when there's been no realization they haven't got any money out but they're still being taxed. That is an enormous impediment and burden on people who want to be in the startup ecosystem. I'm actually very much in favor of taxes by the way. I believe that the most powerful system you can have is governments letting companies, entrepreneurs, executives deploy resources as freely as possible whereas human resources, capital, raw materials try just to get out of the way as much as they can as governments but then tax in a way that creates a reasonable redistribution so that wealth benefits a broad number of people and creates a society that feels right and it's nice to live in. So I'm not advocating for some sort of libertarianism where everybody fends for themselves. I just advocate for a market where those who have the knowledge are close to the facts and have all the incentives aligned to make something work can make the decisions on how to make that work and then governments should come in very, very downstream once wealth has been created, capture some of it for redistribution and support.

Brilliant. I want to move on to a big topic. It is the hot topic. It's AI. There's huge growth opportunities in Europe for AI. France's Mistral, as Tommaso mentioned earlier, is valued at over $6 billion but the US still dwarfs Europe in AI tech funding. $47 billion compared to Europe's 11 billion in 2024 and in fact the US's AI company Anthropic raised $13 billion alone last year. So that's more than the whole of Europe and that valued the company at $183 billion. Clearly the scale of US funding is huge but there is hope that Europe can catch up.

So Luca, I want to come to you because one of your apps, Remini, is one of the most used Gen. AI products with over 100 million monthly users, which is a staggering number. Is AI the opportunity for Europe to build more billion-dollar businesses?

Certainly. AI may go down in history as the greatest, let's say, technological transition or wave in history and by an order of magnitude. So it necessarily, besides posing substantial risks, certainly poses incredible opportunities. I'd say though that Europe has opportunity well beyond AI. We've got more than half a billion people here. To my knowledge, one of the best educated populations globally and so regardless of AI we should have a much greater share of the world's leading corporations across segments and sectors than we currently do. Now again AI being a somewhat new wave may offer better opportunity for breaking that trend than more established industries but again if we fix the fundamentals I think Europe offers an exceptional opportunity for a new kind of a renaissance of economic growth and enthusiasm.

Hilary, let's bring you in here.

Yeah, I would jump in and say, you know Europe has already developed and produced multi-billion dollar companies and there's no reason that past is not prologue.

There is a huge opportunity in AI but, you know, what Europe represents is a deep industrial base and that industrial base is ripe for AI workflow agentic automation. I just think that there's a huge opportunity to take some of those industries and think about how AI can be deployed. I mean, if I think about where we're invested in multi-billion dollar companies over the last decade—Vinted, Delivery Hero, HelloFresh, Sonosource—the list goes on. So I do think Europe has what it takes to create that multi-billion dollar opportunity. It's everything we talked about previously: how do you create the conditions that enable those companies to thrive.

I would say that Europe wants to create sovereignty around chips, which is laudable and ambitious. But I think it's a long way from being caught up, and I don't think it's sufficient. To really win in AI, you need frontier models (as Luca just mentioned—Mistral is out there but only one of the top five or ten models), chips, data centers, and secure energy. Many frontier models are in the U.S. We are investors in both Anthropic and OpenAI, which have seen tremendous growth over the last few years. Anthropic, for example, released cloud coding in March, already a $600 million business. About 70% of European data centers are owned and managed by U.S. businesses. And energy supply is another major area where Europe needs to develop infrastructure.

Just to add context, Sam Altman announced he plans to build 30 gigawatts of data center capacity—equivalent to 30 large or medium nuclear plants. Europe is not building nuclear at that scale anytime soon. So either Europe finds sustainable energy sources or relies on fossil fuels, which will be expensive. Without solving this, Europe will be handicapped not just on chips but on AI infrastructure in general.

Regarding chip sovereignty, in 2020, a trillion microchips were manufactured worldwide, yet Europe accounted for only 10% of the market. The U.S. had 12%, aiming for 14% by 2032, while East Asia dominated with 75%, with China expected to lead by 2030 following $100 billion in government subsidies. The European Chips Act aims for 20% by 2030. Luca, Hilary emphasized the importance of sovereignty—do you think it’s too little, too late?

Luca: It’s hard to say. The percentage alone doesn’t tell the whole story. If the goal is strategic self-reliance in case of international disruption, the focus is having enough production and control over the value chain, not necessarily a high market share. Europe tends to regulate and invest to treat symptoms rather than fundamental issues. The core problem is Europe hasn’t been sufficiently appealing as a place to innovate and invest. We should focus on fundamentals first; otherwise, surface-level interventions won’t make the ecosystem resilient for the long run.

Hilary: Agreed. Europe needs urgency similar to historical examples like Airbus versus Boeing—Europe came together for Airbus because the industry had the luxury of moving slowly. AI is different: innovation speed, compute demand, and rapid model deployment are unprecedented. Europe must break barriers quickly to stay competitive. Fragmentation and geopolitical factors make this urgent; tech sovereignty and strategic cooperation are vital.

Luca: Absolutely. One way to accelerate is to attract existing talent and capital. If OpenAI wants to invest massively, Europe could become the preferred route, rather than trying to build everything from scratch. Capital and expertise already exist—they just need the right conditions. This is not mutually exclusive to investing locally; it’s a better ROI than starting from zero.

Hilary: There’s genuine goodwill across the Atlantic. The U.S. sees Europe as a large market with huge industrial potential. We invest in Europe because of its talent, innovation, engineering, and industrial base. Both sides have opportunities.

Tommaso: European talent is competing head-to-head with the U.S. in AI. Venture-backed European companies hired 13% of the talent pool versus 16% in the U.S. in 2024. AI and machine learning attracted 30,000 new joiners from outside tech and 5,000 from other tech sectors, compared to 7,000 in 2015. How can Europe attract and retain this talent?

Luca: The same strategies for faster investment, innovation, and thriving markets apply. Talented people want: 1) challenging problems, 2) amazing colleagues, and 3) competitive compensation. By creating world-leading companies and R&D locally, people will stay. This could help reverse the brain drain to North America. Europe has hundreds of millions of educated people; we need to create better conditions for them to stay and develop.

Tommaso: Talent in Europe is exceptional and initially reasonably priced, but global competition will increase. Retention is key. Quality universities produce strong engineers, but they need stimulating projects and clusters to retain talent. Bringing together engineers, VCs, growth companies, and banks helps build global champions and fuels talent retention. Proper stock option frameworks across borders are essential to attract and retain talent and investors.

Hilary: Agreed. Frictionless labor mobility and stock option portability make sense. Work ethic is also critical. In the U.S., people are energized by the work itself—they’re intellectually stimulated and economically rewarded. Pockets of this culture exist in Dublin, Berlin, Stockholm, Paris, and London. Attracting and cultivating these ecosystems drives success.

Tom: The average age of tech sector CEOs globally is now 35–45, younger than other industries. What lessons can the next generation of European tech leaders take?

Luca: Age doesn’t matter. Life experiences shape abilities, but competence shouldn’t be assumed from years alone. Experience value saturates quickly. Meritocracy should prevail: if someone proves capable, they can become CTO or CEO quickly. Europe must build more meritocratic environments.

Tommaso: Regarding funding, generational wealth is shifting. Overall, €18 trillion globally, €3.6 trillion in Europe, is moving from boomers to digital-native, impact-driven next-gen. Currently, average asset allocation to growth is <1%, but it may rise to 7% in five years, benefiting tech ecosystems. Capital must be deployed smartly, with banks supporting entrepreneurs and VCs, adapting investment strategies, and connecting capital to innovation. Europe is at the crossroads of technological breakthroughs that will transform manufacturing and investment access.

Hilary: Advice for next-gen tech founders: global capital flows to opportunity. Massive wealth transfer will energize the European startup ecosystem. Humans are still central: relationships, board composition, and people leadership are as important as technology. Develop relationships with investors early; understand value beyond capital. Onsite support programs help portfolio companies scale. Human-in-the-loop remains key.

Luca: Optimistically, Europe has huge upside. Regulation and bureaucracy act like a pressure cooker lid. If we release some pressure, there’s enormous growth potential. Conceptually, similar to China’s growth post-Mao—the lid removal unleashed rapid progress. Europe can unlock growth by easing constraints.

Hilary: We’re bullish on Europe. 14% of our portfolio companies are based in Europe. AI investments include Pactum (Estonia) and Zellex (London). Labor mobility, Blue Card, data centers, and talent pools will pay off. Five years is short in history, but the foundation is strong.

Tommaso: Next five years will be more transformative than the last decade. Technological breakthroughs and strong talent provide optimism. European society must consolidate efforts, learning from successes like Airbus. The new generation is ambitious; everyone should take responsibility for building global champions.

Tom: Thank you to all our speakers: Tommaso Fasati, Hilary, and Luca Ferrari. Fascinating conversation, and thanks to our listeners. Goodbye for now.