Sifted - Sowing tech hub seeds

Good morning there,

There’s a close link in the startup world between world-class academic institutions and hubs of founders starting companies. When you think of Silicon Valley, you may also think of Stanford. Munich? The Technical University of Munich. And so on.

But as Europe aims to bolster its own tech sovereignty, particularly within AI and deeptech, it might want to look beyond already established startup hubs — to perhaps less established tech cities. That’s what we dig into below.

Also, based on the response to my essay last Friday, it seems like some of you are also optimistic about late-stage funding. I’d love to hear from more of you: what are you seeing in the late-stage/growth funding market right now? Are more companies back in the market? Are you seeing up rounds happening? Send me a line.

Elsewhere today, we look at the teenagers starting AI companies, fresh fintech M&A and a Lisbon-based healthtech's new fundraise to expand into Spain and the UK. 

— Anne Sraders, senior reporter

/A message from our sponsor High-Tech Gründerfonds

The perfect blend of convention and conference 

HTGF Family Day is an event bringing together up to 1,500 participants from the European venture capital scene on June 11-12. A mix of convention and conference, the event offers a plethora of investment and cooperation opportunities. 

Sowing tech hub seeds

What does it take to build a tech hub? Founders (obviously), investors (early-stage, and late-stage), and big corporate strategic partners — to sell to, or exit to. On top of all that, you need a very good academic institution nearby.

There’d probably be no Silicon Valley without Stanford University, while, on the other side of the US, MIT helped establish the East Coast as a place for deep, science-based tech. In Europe, though we’ve been slower to the party, the UK’s University of Oxford and University of Cambridge, and Germany’s well-renowned Technical University of Munich (TUM), have also given birth to growing tech hubs.

As Europe strives to build technologies it’s identified as key to its competitive future — like AI and robotics, quantum and semiconductors — even more tech hubs need to be built around the region’s top universities. 

To do so, we need to redirect some of the investment and talent that naturally flows to capital cities today. 

According to a new Financial Times ranking of Europe’s leading startup hubs (accelerators or incubators), France, Germany and the UK have standout performers outside their capitals.

The top-ranked French hub according to the FT, incubator and accelerator EuraTechnologies, is based in the university city of Lille. In Germany, Leipzig’s SpinLab was ranked the second-best hub in the country, behind only Munich’s UnternehmerTUM — which topped the European ranking. In the UK, SETsquared’s Southampton campus ranked as the country’s leading startup hub — and was third in Europe. Investors I speak to also only seem to have good things to say about the city’s university. 

When I recently visited Cambridge, home to one of the hubs, I saw many of the ingredients coming together. Big Tech is there: Microsoft Research, Samsung AI and Apple are a stone’s throw away from the train station. So too are investors like Cambridge Innovation Capital — set up in 2014 to back local knowledge-intensive startups at Series A. The university’s commercialisation arm, Cambridge Enterprise, also receives up to £10m annually from the academic institution to back researchers: £8m of that goes towards early-stage equity investments into spinouts, while £2m goes towards translational research — something spinout folk have also told me we need more of in all hubs to get tech innovation out of labs and into businesses.

Spinout founders and VCs, and tech transfer offices, I want to hear from you. What do you think are the elements of a top tech hub? Is it something you can fast-track, or does it simply require patience? What’s lacking in Europe’s university ecosystem? Email me your thoughts. 

— Tom Nugent, newsletter editor

🏥 Lisbon-based UpHill has raised €7m to continue expanding in Spain and launch in the UK. Its software allows health professionals across different departments at registered hospitals to follow a patient’s journey through the healthcare system, automating some tasks to save doctors’ time. 

• The new capital will fund the automation of more tasks and the company’s new offices in Spain and the UK. Long term, the startup is also planning to expand to the DACH region and the US, CEO and cofounder Eduardo Freire Rodrigues tells Sifted.

🤝 London-based bank payments company GoCardless has agreed to acquire Australia-based Nuapay, an open banking payment provider, from EML Payments Limited. Terms of the deal have not been disclosed and it is pending regulatory approval. 

• GoCardless is backed by investors including Balderton Capital, Bain Capital Ventures and Accel.

👶 Teenage AI founders: ‘I have seven hours less than my competitors because I’m at school’.

🤝 How to develop promising talent in VC.

🇧🇪 Editor Amy Lewin is in Brussels today at the EIC Summit, and at R&I Days tomorrow. Get in touch with her here if you're also there.

🇬🇧 Fintech reporter Tom Matsuda is at London's Digital Asset Summit from today. Fancy catching up? Do reach out.

🤖 On Wednesday, news editor Tim Smith will hear from founders and investors who are working at the cutting edge of automation in the AI economy. Join us to learn where AI can drive new opportunities and efficiencies — as well as where its limitations still lie. RSVP.

🇨🇭Senior reporter Anne Sraders will be at START Summit in St. Gallen, Switzerland on Thursday and Friday. If you'll be there too, let her know.

🇫🇷 Also on Thursday and Friday French tech reporter Daphné Leprince-Ringuet is at Hello Tomorrow's global summit in Paris. If you'll be joining her, reach out for coffee.

🇺🇸 On March 26, Mimi Billing will bring together a panel of experts to hear their actionable advice on how to nail your tax strategy when expanding in the US. RSVP.

⭐️ Also on March 26, we'll be showcasing five of the rising stars from the world of deeptech — exclusively for Pro subscribers. Explore the latest developments and discover some of the most promising startups from across Europe. RSVP.

London-based Relation Therapeutics, which is developing a therapeutics platform using machine learning for drug discovery, raised $35m in seed funding. DCVC and NVentures, NVIDIA’s venture arm, led the round and were joined by investors including Magnetic Ventures, Khosla Ventures, ARK Invest and Deerfield Management Company.

Paris-based Gamestream, a cloud gaming service for video game streamers, raised €4.5m in funding from Audacia and Bpifrance.

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