Sifted - The battle for AI talent

Good morning there,

In case you haven’t heard, Paris is having an AI moment. The French capital has made a name for itself on the global scene, particularly with the emergence of buzzy startup Mistral and the near-one-billion dollars it raised in less than a year.

There are others, and the more AI startups that have piled into Paris the more fighting there’s been for the bread-and-butter of AI models: brains. Founders are telling me a war is on for the brightest researchers and engineers out there — so I took their word for it and found out more.

Elsewhere today:

• The most active early-stage investors in the Nordics
• The FOAK playbook: how to draw up the right cap table
• Mistral, DeepL and Kry investor Avid Larizadeh Duggan on where AI is creating value

— Daphné Leprince-Ringuet, reporter

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🇳🇱 Dutch neobank Bunq is set to grow its workforce by 70% before the end of the year — and expand to the US and the UK, even as it awaits regulatory nods from financial watchdogs. 

🇬🇧 Revolut founder Nik Storonsky cashed in shares worth between $200m and $300m in the company’s secondary share sale last month, according to Sky News. Revolut declined to comment.

• Secondaries were purchased by investors including Coatue, D1 Capital Partners and Tiger Global, and gave the company a $45bn valuation.

🇬🇧 The UK government announced it has classed UK data centres as ‘critical national infrastructure’, the first such designation in almost a decade. It'll give them additional government support in anticipating and recovering from emergencies like cyber attacks and IT outages.

🇫🇮 Finnish smart ring startup Oura has acquired personalised metabolic health startup Veri for an undisclosed amount. ‘A significant portion’ of Veri’s team, including its three founders, will join Oura, according to the company. 

• Veri counts Lifeline Ventures, Accel and healthtech Kry founder Johannes Schildt among its investors. 

🇪🇺 The European Central Bank has cut interest rates by a quarter of a percentage point to 3.5%. It’s the second time rates have been reduced this year. 

🤺 “Everyone is fighting over them”: Top researchers and engineers are what AI companies need to win, and in Paris, they are fast becoming a scarce resource. Several AI startups like Mistral, poolside and H emerged with record-breaking fundraises — and they’re determined to secure top-notch talent. It’s meant tough competition against Big Tech companies established in the French capital, but also against fellow startups — which founders and VCs are describing as nothing less than a raging ‘AI talent war’.

🎧 Must listen: Avid Larizadeh Duggan, senior managing director at Ontario-HQ'd growth-stage investor Teachers’ Venture Growth, is one of Europe’s first operator-turned-VCs and a backer of Mistral, DeepL and Kry.

• She sat down with Sifted editor Amy Lewin on the Sifted Podcast to discuss what’s top of tech companies’ minds at the moment, and why investors and board members without operational experience don’t always quite “get it”.

💰 The most active early-stage investors in the Nordics.

🏭 The FOAK playbook: How to draw up the right cap table. Building first-of-a-kind climate tech is hugely capital intensive, meaning startups building them can’t count on the traditional financial playbook used by software companies time and again. We asked VCs and the European Investment Bank what a FOAK cap table looks like, and how companies can secure much needed debt financing.

• Senior reporter Freya Pratty is also discussing how startups building infrastructure can tap funding at the Sifted Summit, our upcoming annual event in London on October 2 and 3. Grab your ticket here.

🧑‍🏫 Three things I wish I’d known early on in my startup marketing career. Level up your financial literacy and invest in your relationship with the finance director, plus other gems of advice from CMO Jemma Wong.

🇬🇧 Three day work weeks and love for Mondays: The current state of the UK workplace. (Sponsored by Techspace)

🌍 How European tech can compete with China and the US, according to an EIC board member. (Sponsored by European Innovation Council)

🥷 Revolut’s big bank ambitions threatened by surge in fraud complaints. (Bloomberg)

Advice for entrepreneurs going global

Cross-border M&As are bouncing back in 2024 - but there's no one single path to scaling a company. 10 of our experts share their top tips on how to build and manager cross-border teams in our latest guide.

📈 Growth rounds are rebounding in Europe, according to new data from cap table management platform Carta. The median Series B round size is up 40% year on year, while the median time to close a Series B is down from 25 months in H2 2023 to 16 months in H1 2024 (a 35% drop). 

Elsewhere in the data:

• At £7m, the median Series A round is down 10% year on year, but up by £500k on H2 2023. The average Series A comes in at £11.8m.
• The median seed round size is up £800k on the peak pandemic period to £3.3m in the first half of this year. That said, deal volume is 54% lower according to Carta’s data, likely meaning a concentration of capital in fewer but more attractive deals.
• Senior reporter Anne Sraders recently wrote about that ‘flight to quality’ in this newsletter.

Schiedam, Netherlands-based Battolyser Systems, which is developing hydrogen electrolysers, raised €30m in Series A funding from Global Cleantech Capital, Innovation Industries and Invest-NL.

Copenhagen-based Matr Foods, which makes plant-based meat alternatives, raised €20m in debt funding from the European Investment Bank (EIB).

• There have been a number of raises this year for plant-based meat companies in Europe. Among them, Spain-based Heura Foods’s €40m Series B and UK-based THIS’s £20m Series C.

Turin, Italy-based Tau Group, which creates technologies for the electrification of mobility, raised €11m in Series B extension funding. CDP Venture Capital and Santander Alternative Investments led the round.

• It's the 21st equity deal CDP Venture Capital has done so far this year, according to Sifted data, which also shows Santander as top for Series B+ deal count in Q3 so far.

Oxford, UK-based Purple Transform, which uses AI data analytics business to identify and prevent incidents like theft and trespassing on railway lines, raised £4.5m in funding. Mercia Ventures led the round and was joined by Sure Valley Ventures.

Stockholm-based Wingbits, a community driven flight tracking network, raised $3.5m in funding. Borderless Capital and Tribe Capital led the round and were joined by Antler.

If you’d like to submit a deal, get in touch. 

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