European tech must now build a power machine
EU Inc should be only the start. Continental progress needs a new cultural project
Good news: dunking on Europe is becoming low status and a growing number of founders and investors are building incredible companies and capabilities to secure Europe’s future.
Bad news: while founder energy is critical to saving Europe, only a handful of people are bringing this intensity to fixing European policy.
The lesson from EU Inc, a necessary but narrow proposal that’s still been hard to get done, is that progress on any of the bigger issues — capital markets, AI, defence, energy, internal trade, labour market etc. — will require a much bigger effort. It’s hard to win these arguments at the best of times, let alone when they require countries to pool their sovereignty.
This means changing tack. Too often, too many VCs and founders complain about Europe’s ‘fragmentation’. But Europe’s starting point isn’t a fragmented, single entity so much as a fragile, partial and incremental union between independent countries with their own histories, priorities, cultures and languages. Nor is Europe just the EU: Ukraine, Britain, Switzerland and the EEA countries are all part of this mission.
This has two implications:
Europe isn’t really one market, but many: the Draghi report showed internal barriers in Europe were akin to a 45% tariff on manufacturing and 110% on services. Europe has the talent and increasingly the capital to build global winners but, at least for some categories, it just doesn’t have the markets.
Any big ticket item critical to Europe’s future that requires integration and agglomeration is not going to happen naturally. It’s going to be hard won. If European optimists want to stop losing, we need to do more than simply celebrate the Draghi report and move on. Vision without execution is hallucination.
Instead we need a much deeper, longer term commitment to win the argument on Europe’s strategic interests, win power and deliver.
That means not only getting out beyond groupthink tech conferences and hacking Brussels, but building bottom-up ambition across the continent, i.e. the only way to secure genuine and durable consent rather than just temporary, top-down imposition.
European VCs should be leading from the front. The key lesson from a16z’s American Dynamism movement is that a fund is both a financial and a cultural institution, and these forces reinforce each other. a16z had a cultural, political and investment thesis which coalesced into a fund. They created a flywheel, translating private information into a cultural movement with real founder fit, investing in the resulting companies, and all the while bending the world in the direction they cared about. In effect, they have combined technology, capital, policy and culture to build a full stack power machine:
This crystallised when they recently hired Erik Torenberg and Alex Danco, with the latter capturing the thesis perfectly: “Power transfer technology…is the business of VC…to give founders more legitimacy.” Read the full post, which is a deeper theory of power and progress — by building and leveraging distribution to give founders the power they need to build a better future — than I’ve heard from any other investor or policymaker. For all the granular regulatory work that a16z do, their ability to use media to confer power on their portcos, building awareness and legitimacy with customers and policymakers equally, may be the most valuable ‘policy’ work they do.
No one in Europe is building anything even remotely comparable, because European tech lacks a theory of power.
You don’t have to agree with everything a16z believes to respect or learn from the underlying strategy. The constructive lesson is to radically change the upstream cultural environment, raising ambition and creating the space and consent downstream for specific changes. Progress happens at the speed of culture, because culture is how you coordinate at scale. So let’s speed up culture! One reason that a16z are so good at this is because they’ve just got so many reps in by now.
Building this in Europe matters particularly because the necessary ambition definitely isn’t going to come from the existing group of stale trade bodies or righteous campaigners that make up Europe’s policy apparatus today. You don’t protect European democracy by endlessly describing and restating our values (e.g. EuroStack). You protect European democracy by acquiring leverage and winning. Only then do you get the chance to advance your values. Until we fix this Europe will stay in a holding pattern: often virtuous, rarely victorious.
So we need a different approach. For a start, there is just an enormous undersupply of media and culture to inspire a) aggressive founder ambition in the national interest and b) policy progress both in Brussels and across the continent, produced in different languages and tailored to countries’ local contexts.
Where is the founder-led, European bible of audacity, the cri de coeur, akin to The Technological Republic? Where is the high-variance grants programme for tech and economic progress writers, to kickstart the posting-to-policy pipeline across Europe? Where is the talent pipeline for political candidates? Where are the events — public and private — that get European tech and policy leaders organised?1
Europe can, and must, win. For decades, we’ve outsourced our security to the US, energy to Russia and industry to China. Now all three look vulnerable. But for too long, a myth took hold that Europe can’t compete, which is neither true nor helpful. Meek belief breeds weak results. Leave that to the handful of sycophants who choose transatlantic herd approval over European agency.
Maybe not so long ago Europe didn’t have a generation of founders and investors with major exits who could anchor and fund this new European power machine. But that’s no longer the case. US tech has now funded American Dynamism, The Technological Republic, a $120m Abundance and Growth philanthropic fund, many more $millions for super PACs, think tanks and other grant programmes, and now even a new film studio about American exceptionalism. Why can’t we build something similar — even if at a smaller scale initially — to seed/scale more efforts like these and build a cultural platform to flood the attention ecosystem?
The vibe shift in European tech — led especially by a new generation of audacious, hard tech founders and investors — is overdue and welcome. But there is so much more to be done. It’s time for the European counter-elite to lead from the front. If that’s you, let’s talk.
“Attention is upstream of all of our ideas and action" - Nadia Asparouhova
I have been doing this privately in the UK. DM me if you want to help scale across Europe.