Upside is a weekly podcast designed to look behind the headlines that will affect European venture, startups and investing.<\/p>\n\n\n\n
Below are the notes from this week’s episode. Episode links above to tune in and stream wherever you pod.<\/p>\n\n\n\n
The Stoxx 600 closed at a record 657 this week, up roughly 10%, still lagging the US. Basic resources, semiconductors and banking led in Europe. Luxury and autos didn’t, Stellantis is down nearly 50%. The FTSE 100 hit new highs, the S&P is up, the Dow closed at a record for the fourth straight week.<\/p>\n\n\n\n
The stat that stuck with me: the five best-performing European stocks of 2026, SoyTech, ATS, Technoprobe, Xtron and ST Micro, are all semiconductor names, up in the hundreds of percent. But Mads flagged the catch. Dig under the hood and many aren’t growing revenue that fast, some are declining. What’s happening is the whole sector getting re-rated on multiples because it’s adjacent to the AI story, not because the fundamentals back it up.<\/p>\n\n\n\n
Alphabet is also back in the bond market for another $25 billion, weeks after its first ever negative free cash flow quarter. Hyperscaler bond issuance is up nearly $200 billion through July, up 79%. The debt is piling in, and yields are starting to price in the risk.<\/p>\n\n\n\n
SpaceX gave us its first quarterly numbers as a public company: Q2 revenue up 92% to nearly $8 billion, Starlink the biggest driver, AI now a $2.6 billion line (mostly leasing data centre capacity), launch itself only up 29%. Mads pointed out the analyst spread on where this stock should trade runs from $62 to $800 a share.<\/p>\n\n\n\n
That’s not a disagreement about numbers. That’s a bet on whether you believe in Elon Musk. Sion, who holds SpaceX exposure through VenCap’s underlying funds, gave me the LP view on lockups: managers don’t dump a concentrated position the day the lockup ends, they drip it out over 18 months to two years.<\/p>\n\n\n\n
A few more worth a line each. Bending Spoons bought Airtable for $1.3 billion, less than its total capital raised and well below its $11.5 billion valuation in December 2021, though Sion’s LP point is that most managers had already marked these 2021-vintage rounds down. And Waymo, Wave and Baidu are all now licensed for robotaxis in London, though Wave’s still running with a safety driver and, per Mads, probably a year or more behind Waymo on full autonomy.<\/p>\n\n\n\n
This is the story of the week for me. Demis Hassabis is stepping aside as CEO of Google DeepMind to become chief scientist, focused on AGI and Isomorphic Labs. Koray Kavukcuoglu, previously CTO, is taking over, reporting straight to Sundar Pichai.<\/p>\n\n\n\n
There’s no CEO title anymore. DeepMind now sits directly under Google.<\/p>\n\n\n\n
On the same day, Jeff Dean left. Not for a rival lab, not for a pile of cash. He’s employee number 30 at Google, the man behind MapReduce, BigTable and Spanner, co-founder of the Brain team, the person who pushed TensorFlow into the world and then spent a decade cutting TPU inference times by 10 to 30x. Internally he’s known as the Chuck Norris of coding. He left alongside Sanjay Ghemawat, the other most senior engineer at Google, to start a public benefit corporation called Discovery Loop, aimed at automating scientific research through thousands of parallel experiments. Google is investing in it and giving the new venture compute for at least a year.<\/p>\n\n\n\n
Mads’s read is the sharpest one I heard all week: DeepMind had too much mission and not enough shipping. Lots of brilliant people focused on research and publishing, not enough on getting product out the door, which is exactly why Gemini 3.5 Pro has missed its release date repeatedly and Alphabet fell 4% on the week. Koray, by contrast, is a builder. He joined DeepMind in 2012, was on the team that taught a model to play 49 Atari games from raw pixels alone (the paper that got Google to buy DeepMind in the first place), and has since shipped WaveNet, voice search and Maps features at scale. Handing him the reins, with a direct line to Sundar, reads like Google deciding it’s done losing the shipping race to OpenAI.<\/p>\n\n\n\n
I’m long on Google here. This isn’t a company in retreat, it’s one correcting course with a genuine builder in charge. Sion’s angle was different again, and it’s the one I hadn’t considered: this is talent moving from public markets, outside VenCap’s universe entirely, into private markets. His question for his own managers now is whether they can credibly underwrite and win a deal with someone at Jeff Dean’s level.<\/p>\n\n\n\n
The UK Scale-Up Fund is a \u00a31 billion, government-led initiative pulling in pension providers including Railpen, Nest and Border to Coast. It isn’t live. Some participants have only committed to “explore” it, whatever that ends up meaning in practice.<\/p>\n\n\n\n
Sion came to this with actual numbers, which is rarer than it should be. VenCap looked at its own back-book: seventeen funds it backed between 2011 and 2020 that raised over a billion dollars each. As a cohort, they’ve returned 2.8x net, projected to land around 3.5x once fully realised. Forty percent are over 3x net, two are over 5x, none are underwater. On the surface, that’s the case for the UK fund closed: billion-dollar funds work.<\/p>\n\n\n\n
Then Sion went a level deeper, and this is the number that matters. Look through to the 759 underlying portfolio companies, and the top five generate about a third of total value, the top ten almost half. Only eight individual investments across the whole cohort returned an entire fund on their own, concentrated in just three of the seventeen. Fund size, in Sion’s words, is a bit of a red herring. Back the right companies and you can generate venture-level returns at scale. The actual risk for a UK-based fund is fewer shots on goal than a global fund gets.<\/p>\n\n\n\n
Mads made the wider case for backing ambition at all: venture only works if managers are honest they’re aiming for outlier returns, even though the base rate says most won’t get there. Nobody promises the multiple, they promise to try for it. Sion’s pushback was about credibility rather than ambition: a manager with a track record of hitting those numbers deserves more trust than someone promising 10x on a first-time fund with nothing behind it. His read on the \u00a31bn fund comes down to one thing: who ends up managing it.<\/p>\n\n\n\n
My prediction:<\/strong> Bending Spoons is showing the way. By the end of next year, expect a European firm dedicated to AI roll-ups to launch, with a first fund of \u20ac250 million or more, targeting industrial and physical AI. Sion’s response when I asked if VenCap would back a firm like that: pretty off-strategy for them.<\/p>\n\n\n\n Mads: Olex, $312 million at a $3.3 billion valuation.<\/strong> Just six months after raising over $1 billion, Olex is back for more. Founder James Dackombe is 25, a Thiel Fellow from Yorkshire who also runs Coalmind, a brain-computer company he founded at 17, more than $350 million raised across the two before he turns 26. Olex builds chips for the slow half of AI inference, the token-by-token generation stage, with no high-bandwidth memory, sold as full racks rather than single chips, aimed at coding agents and other agentic workloads. Nothing shipped yet, no benchmarks published.<\/p>\n\n\n\n Mine: an Amsterdam battery startup, $43 million raised.<\/strong> Iron-air batteries that store power for days. I’ve got a bit of a fixation with battery tech, so this one’s a personal favourite.<\/p>\n\n\n\n Sion Evans, on riding around San Francisco in a Waymo:<\/p>\n\n\n\n “Self-driving cars are real. It’s not a science project, it’s not an experiment, it’s a service you pay money for. It’s a magical experience.”<\/p>\n\n\n\n Mads Jensen, on what actually went wrong inside DeepMind:<\/p>\n\n\n\n “I think there was probably a little too much mission, and a little too varied a set of missions, where you had lots of people focusing on research and publishing and maybe not enough on shipping.”<\/p>\n\n\n\n Sion Evans, on what the UK Scale-Up Fund really needs to prove:<\/p>\n\n\n\n “Fund size is a bit of a red herring. If you back the right companies, you can absolutely generate venture performance. The problem coming out of a much smaller market like the UK is you might have one shot, maybe two.”<\/p>\n\n\n\n Mads Jensen, on why venture runs on aspiration, not promises:<\/p>\n\n\n\n “Nobody’s promising LPs we’ll give them ten times their money back. But it’s the aspiration to create something big and meaningful that fuels this industry. If you’re not trying to go for it, what are you even doing?”<\/p>\n","protected":false},"excerpt":{"rendered":" Upside is a weekly podcast designed to look behind the headlines that will affect European venture, startups and investing. Below are the notes from this week’s episode. Episode links above to tune in and stream wherever you pod. How Hot Are Markets? The Stoxx 600 closed at a record 657 this week, up roughly 10%,… Continue reading Upside 103 \u2013 Hot Markets, DeepMind’s Shake-Up and the UK’s \u00a31bn Scale-Up Fund<\/span><\/a><\/p>\n","protected":false},"author":5,"featured_media":7009,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[408,134,91,407,92,1],"tags":[392,394,390,395,397,391,393,396],"class_list":["post-7006","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-episode-ai","category-ai","category-episodes","category-europe","category-markets","category-playbook","tag-ai-security-red-team-testing","tag-google-deepmind-shake-up","tag-jeff-dean-leaves-google","tag-semiconductor-stock-re-rating","tag-spacex-q2-earnings","tag-uk-scale-up-fund","tag-vencap-sion-evans","tag-venture-capital-fund-performance","entry"],"acf":[],"_links":{"self":[{"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/posts\/7006","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/comments?post=7006"}],"version-history":[{"count":3,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/posts\/7006\/revisions"}],"predecessor-version":[{"id":7012,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/posts\/7006\/revisions\/7012"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/media\/7009"}],"wp:attachment":[{"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/media?parent=7006"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/categories?post=7006"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/superseed.com\/upside\/wp-json\/wp\/v2\/tags?post=7006"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Deals of the Week<\/h2>\n\n\n\n
Notable Quotes<\/h2>\n\n\n\n