E656 | This Week in European Tech

0:00Welcome to Upside, where we look behind the headlines that affect European venture, at the real news stories and all the goings on. Today, it is Mads, Lomax and myself. And we're looking at slush. Mads has just been, Lomax and I haven't. So we're going to ask Mads all about the greatest event for startups in the world. The EU AI regulation rollback. It looks like there's some changes afoot across the EU. Hopefully, they will kill the cookie banner. New UK investment initiatives, which aren't just words and noise. It looks like the UK private and public capital is starting to make some inroads.

0:38Germany has a space strategy. Never thought I would say those words. And we've got some mega news in AI Corner from Meta, NVIDIA and Google. And I really want to lean on you, Mads, for this TPU insight. It looks really, really interesting what they're doing there. And finally, how everyone everywhere is from somewhere else. Everyone is an immigrant. If we look at the data of what's going on in the States for unicorn founders, what's going on across Europe for startup founders, everybody is from somewhere else.

1:14But first up, Mads, tell us all about Slush and how knackered you must be. Pretty good, all things considered. I think I skipped the worst or the best of the parties, if you will. But it's a great event, kind of founded about 17 years ago in the cold, cold north. polar bears are roaming. There was this idea or this insight that Finland really has a bit of a risk-adverse or anti-entrepreneurship culture at that time, back in the 2008s, just around the time of the financial crisis. Some folks might remember it was, maybe not, it was kind of a time when there was a company called Nokia that still was dominant in this kind of mobile technology.

1:54That was the last year though, right, surely, because 2007 was the iPhone, so obviously. And they still had a lot of market share at the time. Yes, the iPhone was getting a lot of, of course, a lot of headlines. But when you look at the number of handsets sold, it was still a huge business. But Slush was launched kind of as this startup event. It wasn't just a few hundred people to kick off with. And then since then, it's just grown and grown and grown. And of course, Nokia collapsed a few years later. As you absolutely said, the iPhone took over everything. and then you do kind of slush turned Helsinki into this at least for one week a year into this absolute startup hub where tens of thousands of people come from all over Europe and the wider world to look at startups and talk about startups and invest in startups and meet startups and it's just all startups galore.

2:43It's not as big as Web Summit, is it? Is it still smaller? I mean, Web Summit is about 70 ,000? Yeah, I think it's much smaller. I think it's 15 ,000 people but it's just all about the startups it's much less corporate it's much more about ventures definitely juxtaposed with web summit which was last week so the week before and web summit is 70 000 people started in the same same time period 2009 but web summit has become very very corporate it feels like an expo effect it always feels like that's the end point of the startup they're cool for a period of time like dating apps when i was a single man dating apps were cool for a period of time and then it became whatever the mainstream and you know the so maybe that's the same with the startup events i think you have an inherent conflict between wanting to maximize returns as the owner of a conference or events business versus wanting to prioritize like small startups and small fund managers and things and actually you know ultimately uh slush is non-profit no whereas Web Summit is run by, you know, Web Summit's run for EBITDA.

3:50And ultimately, where do you get EBITDA? From the big corporate accounts, not from startups. Mads, tell us more. I mean, I've only been twice. I think it's the best, I haven't been for a couple of years, but the best founder-focused startup event I've ever been to is Slush. I think it's superb. I mean, you've got, I think it's some 400, you know, tables, which are just one-to-ones. And, you know, all the startups can book with the investors and vice versa. huge database you go in and you can select and filter and search and use your favorite llm to figure out exactly who you should be spending time with so everybody just books a bunch of meetings and you can so you can go there and you can have 20 25 meetings in two days right is it still a nightclub is it still that kind of nightclub cool neon vibe i think they've toned the smoke machines and the laser lights down a little bit right so you you can be your lungs still function on day two.

4:43But there is, yeah, it's still kind of, it's still darkness and, you know, it's sort of very, you know, the cold Nordics in winter. I loved it. It felt like inside of Wembley Arena, like a massive, great big, like, dark, moody, black neon lights and all these investors and startups roaming around. I thought it was super cool. Any key takeaways, Mads? Any insights, key takeaways from you? Listen, lots of things happened. the state of european startups kind of kind of new reports and insight and i didn't see any of it i was so busy meeting cool people i completely ignored all the official programming and just stayed on the how many people can i meet and and and have a meaningful conversation with while i'm here fair enough also in quick news this week i want to actually this lomax let me start with you Germany has a space strategy.

5:36We'll go into more quick news in a second. But just to start with, what the heck? Tell us more. Well, also, it's about bloody time, isn't it? I mean, you would have thought this is 10 years too late. I think it's good. I mean, what is my takeaway? So Germany's just released its big space strategy this week, 35 billion euros of spending, which for context is a lot. Okay. Yeah, okay. Not insignificant. I think one of the takeaways here is this is basically by the Minister of Defence. and I think foreign affairs. So we've talked about it here before is space in many ways equals defense. And in the sort of new frontier for nation states playing off against each other will be in space.

6:17So this is a very much defense led. I would also argue also resourcing. I've always felt when I was looking at what Elon was doing. What are you talking about mining now? Are you no? Sorry. Yeah. Yeah. I always figured it was mining rights. It looked like, you know, we're running out of all these things. there's rare earths over there we've got platinum over here and some diamonds over there and who knows what's on the moon made up of the same stuff that maybe i think you're getting ahead of yourself i think i mean i think yes but also there's probably lower hanging fruit in relation to that but i i think this is defense it's like you know we talked about he who controlled or he or she who controlled the oceans you know controlled the controlled the planet it's now i think it's he he or she who controls the lower earth orbit or geostationary earth orbit whichever one is all of it so so in other words it's elon musk well yes with you know with starlink and for sure but this also does lean into the comms piece isn't it because there has been a lot we've spoken a lot before about how europe is trying to not rely on starlink so comms defense europe is trying to build up sovereign capability for sure in the context of space but it's a long way behind it's been caught massively flat-footed and you know unlike a relatively well no longer small but nimble private company in in spacex and we have a bunch of you know conglomerates like enduro sat or utel sat that you know are we have new all sound very 80s i mean i don't i don't know i don't want to down like like do europe down because we have some great new space companies right so the new space economy including you know i saw aerospace and some great emerging companies including in our portfolio but i won't big up my own book no do it no big big big the book baby we need to go back to germany he wouldn't be so shameless i think the interesting thing for this german this german thing is that actually it does talk about procurement and partnerships from newer companies it's not all of the private activity with the private sector is not going to accrue to you know the big primes the big aerospace primes like they have done in the past so they are willing to engage push for kind of new independent operators so i think that'll be interesting clearly it's very hard to go to those procurement programs so we'll see how that that plays out but big amounts of funding there for sure and actually i've been messaging our founders working in new space today just to kind of get their insights on on that interesting so i think we can catch up more about that in weeks to come mads anything that we've missed on germany's space programs Yeah, listen, I think it's great.

8:50It also feels like a bit of a missed opportunity at the same time. I mean, obviously, Europe, we're the best world in the world. We're not going to create five GPS systems. We're not going to create seven different satellite defense systems, right? I mean, we're just individually, we're all too small to fund these massive programs on our own. So great to see Germany investing. It has to be the locomotive. It is the biggest economy. the 35 billion euros is actually more than the European Space Agency's entire budget. So they're putting real money behind it or collectively we are not stepping up and investing enough.

9:26I would have loved to see the big European countries come together and say 100 bill, right? That we sort of fund jointly so we can take on some really big missions instead of sort of the piecemeal approach. Because we're so behind, so much catching up we have to do. and we need to put real money behind it. But okay, so great, fine. 35 bill, it's a nice down payment. Let's go. It's more than pocket change, dude. I mean, this is a big chunk of change. I think it's a good start, but we'll see how it unfolds. The other thing that was also in the quick news section quite prevalent this week were reports about immigration and how many immigrants there were in unicorns in the States and how many immigrants founders there were across European startups.

10:10And the numbers are quite staggering. I think it was Deal Room that put the initial report together that I saw, which basically tracked every city in the States and looked at unicorn founders. And it was somewhere between 50 and 90 percent of founders of unicorns are from somewhere else, depending on the city that you track, all the way from New York up to the Bay. And there was another report about UK, the highest performing or the fastest growing UK businesses. around half of the founders there were also foreign-borns i don't know what to make of this i just thought it was quite interesting but lomax was there anything else that caught your eye on the immigrant side no i mean many people have actually been best investing in this thesis for years and that um as you can see the data the data shows this now with 44 percent of u.s unicorn founders foreign-born and 54 percent of uk's fastest growing 100 companies are foreign-born founders.

11:06I mean, immigrants tend to have moved in the case of the US, for example, or the UK, immigrants tend to have moved to that country to create a new life for themselves or to build a big business because they were perhaps constrained before they had lack of access to capital or lack of access to talent or lack of access to the rule of law, whatever it may be in their home countries. So I don't think it's anything new and it's not surprising at all. I mean, I was actually surprised the numbers aren't aren't even bigger quite frankly that the um the the big outcomes come from the really really really hungry people who are willing to take that leap move to a new country start a new life people operating at the frontier and in all aspects of their lives the obviously if we get a reform government in next this is this is not going to marry to their to their policy is Well, it may or may not.

11:59It depends on what you do in terms of skilled immigration. Because if you still enable Windows for that, and the US, you know, despite, in a way, if the way you tighten, you know, if there is a tightening of immigration, in a way you're making it harder for founders to try and hack the system to try and get in. For example, in the US with the, is it the HB1 visa? H1B visa, where they've now put a hundred grand price tag. There are other visas. There's the O-1 visa, for example, that you can hack your way through to get into the US. What does O-1 mean? What's an O-1 visa? The O-1 visa, you have to meet three of the following eight criteria.

12:39One relates to show that you've been issued distinguished awards, show that you're membership of distinguished associations. I don't want to talk my own book, but Outsized Ventures, we invest in European founders moving to the US. So it's just like these are immigrants as well. They may be moving from one westernized economy to the other, but still, they're still immigrants and economic migrants in a sense. I think everyone should do a DNA test and work out that everybody is from somewhere else and just all get over ourselves a little bit. But Mads, anything very quickly before we move on from immigration?

13:06Yeah, I'll try and pick up on what you talked about and maybe try and give an attempt to connect the dots a little bit. Because on one hand, yes, so more than half of the UK's fastest growing companies are run by founders born abroad. I mean, they've got to get pause, right? I mean, Lomach, you said you're surprised it isn't more. I mean, that is a lot. That is a staggering number. You could have three to five times over representation compared to the level of immigrants in the country. And at the same time, Dan, as you're saying, reform is leading the polls and voters have immigration as top of their concerns.

13:41And I think the sign challenge we have as investors, as a business community, is how can we create a system where we can attract that amazing talent while addressing the genuine backlash that we've seen from a mass of low-skilled immigration, where sometimes you find people with values that are incompatible with what we have here, right? That aren't necessarily here and us drivers and driving and building companies and all that stuff. And so, you know, maybe one way to think about it is we've got to recalibrate our immigration system to a point where we no longer have such a strong backlash against immigration so that we can, again, you know, embrace and welcome all the great skilled migrants that are going to go on to build great companies because we need them and we must have them.

14:27And the challenge, I think, is because we've been a little bit lax around immigration. We've let ourselves get into a position now. I think this is something you've talked about a few times, Lomax, where there's become such a backlash against immigration that we've risked throwing out the baby in the bathwater and all the other good stuff. And this is what we have to fix. And I think there are signs that the government has finally woken up to it. And we've seen sort of Shibana Mahmood, she's proposed some new policies that actually tries to distinguish between what is the type of high-skilled migration that we really want to attract and actually make it even more attractive for people to come here and have a fast-tracked citizenship, et cetera, versus maybe other types of migration that actually are maybe not going to contribute so much to society.

15:08I don't know why we haven't. I mean, I know that she's copying a lot from your homeland, Mads, She's looking at the Danish laws and regulations. But I don't know why we don't do the Aussie point system, which seems to pretty much work. I think it still does as far as I can gather. Don't forget, the point system is a system for attracting a lot of migrants. Right. That's the idea is if you have a genuine skills shortage and you want to attract a lot of people, you have a point system. Because there's an open system. As long as you qualify in points, you can come to the country. and maybe that's the right thing to do but i just think right now there is such a backlash against immigration yeah skilled migration is down um actually in a way the more that the uk sits in the relative turmoil that people think it's in actually it's actually struggling to attract very very high quality people because it's not seen as a welcome place but one thing also to bear in mind is that you know the uk is a center-left government i sit here in portugal which you know has always leaned a little bit left and they've just passed like as of like the last couple of weeks a new rule on foreigners which have massively tightened up immigration laws here but you know look at germany look at france these look austria these countries will are skewing and will likely skew a lot a lot further to the right and so it is going to be it's going to be the a defining moment for our age you know in the next like decade and how do we as a small like as a small sector even though we have you know big gdp aspirations or big aspirations to move gdp how do we kind of like navigate and stay relevant and actually make sure we are still attracting the best people from around the world to come and build big companies is absolutely key and you know for the science and technology ministers in all of these countries they're going to have to be like pretty thick skinned to try and encourage the you know home office in whichever country it is to actually make sure that there is a broad enough window for high skilled high skilled immigration it feels like there's some sensible noises it feels like they are aware and also we're going to talk about later yeah i mean it's basically like it's a baby out it's a baby you know baby with the bathwater kind of issue isn't it but it also feels like very easily fixed it feels like high talent high skilled labor especially in tech innovation ai which are on the for fronts of the brains of people in government.

17:30It feels like a relatively easy thing, which doesn't become a political hot potato because you're not bringing in thousands of people to go and, I don't know, pick tomatoes on a farm. These are, you know, a lot lower, less numbered kind of people coming in to build smart, techie things, he says. Anyway, hopefully sense will prevail. But I want to very quickly in the quick news section and talk about defense IPOs because something has been happening across Europe. Lomax, what is going on with defense stocks? Well, defense stocks are, you know, very soup du jour at the moment. We know since the Russian invasion of Ukraine or the second invasion or whatever you want to call it in early 2022.

18:10In fact, I was looking is that the European Defense Stocks Index, the stocks, aerospace and defense index is up this year, you know, higher than S &P 500 and the Nasdaq composite which is we know has been exploding with ai so clearly i guess they were coming from a relatively low base but it's been an amazing run in the public markets and so there are a range of like relatively old school um kind of oem type defense companies that make tanks and ammunitions etc and infrared sensing devices etc that are uh looking to ipo and take advantage of this. The PE multiples of these companies are staggering.

18:53I think, Mads, you've got some data on that, no? Yeah. I mean, firstly, some of the companies that are already public, you've got the Tisenkrups, they have their marine systems, which they've just spun out and that surged 35 % of the debut here last month. You've got the Rank Group, which is a tank gearbox maker. They're up more than 200 % since they were listed last year. You've got Exoson, which is a French night vision goggles company, also up more than 130 % over the last year here. You've got a pipeline of new companies IPO-ing. You have CSG from the Czech Republic. You have KNDS, which is a tank maker, making the Leopard and the Leclerc.

19:34And you've got just so much, as you say, so much happening in this space. But the PE multiples are insane. And actually, let's not forget, these are relatively low low ebitda margin companies these are 10 to 12 percent ebitda margin probably five six percent kind of free cash flow margin companies but they're not these are not like high margin tech companies with big growth rates i also wonder like isn't again no investment advice but isn't this a short like isn't it like these are all this is like old defense this isn't this isn't like anduro or potentially helsing which has aspirations to be an anduro you know a world where these guys are building the stuff that we don't need anymore.

20:13These guys are, you know, training the horses in 1914, aren't they? I mean, governments won't buy it, Lomax. They won't buy what? They won't buy the Enduro product? No, that's what I'm saying. It doesn't mean the governments won't buy the horses. No, of course, no. No, but it means, yes, I know, in the short term. But I think in the mid to long term, nobody wants tanks anymore. Of course, that's why we're all tech investors, of course. yeah um i i still find it extremely disheartening that we even have to have this conversation about you know gearboxes for tanks and machinery to go and kill people but i'll i'll park someone's got to defend your democratic your democracy dan i knew exactly where you were going to go with that um anything else in the quick news section i saw that vinted is doing something what's going on with vinted secondary sale secondary sale i think is an eight billion valuation vinted i mean the thing about vintage which is a lithuanian marketplace was basically dead in 2015 2016 i think that the lesson and then um i think fj labs maybe sent uh one of the investors sent a um sent a ceo and turnaround ceo an operator to go in who's now turned it around i think it's a is it 10 billion 10 billion gmv now 1 billion revenue i know that somebody bought depop somebody bought the competitor and it's not gone as to plan but vintage seems no vintage it's an absolute beast and it's in lithuania so it's a shame yoni wasn't yoni here from the last few two weeks ago vinted is a real baltic success story and it's also a reminder vinted is at 8 billion it is 50 percent of the total value of all lithuanians ecosystem wow that's crazy it's still on a bit of a terno isn't it so that that pie will grow but vinted um it's an it's a reminder that building big companies takes a long time and also building not big companies is also can be non-linear much as we would like it all timing timing is that's the other thing i think that sometimes you just need to stay in the game and execution has to have been yeah that old john lennon quote just just stay around long enough for luck to find you right i mean there has to have been maybe a covid fact or some other factors that were kind of that's my approach to venture capital but that's for another conversation just just stay around long enough to annoy enough to get lucky I want to talk about the UK because there have been, and At Time of Press is now...

22:35Before we go there, can we talk about cookies? Because actually I thought that's probably the most interesting bit. Yes. Are they dead yet? Just tell me they're dead and I'll be happy. They're not dead yet. They're not dead yet. But the commission has proposed a new digital omnibus bill, which is a massive regulatory climb down. basically admitting that the GDPR cookie enforcement created worse outcomes than the problems it solved. And it's a single legislative package. Well, there you go, right? That is combining delaying the AI Act plus GDPR changes plus cookie law reform. So it's a massive package.

23:16It's been proposed now. It could take years before everything is passed through the system. But it is a massive, massive change for the commission. Now, the privacy brigade are screaming murder. You've got 127 organizations calling it the biggest rollback you could have imagined, saying it's a capitulation to big tech interest. And yes, of course, we should acknowledge there's some concerns and privacy is important. But it's clear that we have to do something here. you cannot become the best at making things by being the best at restricting things and until europe again starts becoming the best at making things you know we're just not going to make it in this newly hyper competitive world so i think this is a big big step i just i also can't believe i mean i've seen recently that meta has again been changing their terms and conditions of usage i just can't believe that the horse hasn't already bolted so if you're on instagram you've pretty much sold your soul if you're using any any big tech you pretty much sold yourself even if you are in europe so it feels quite a sensible thing to be a little bit more on the uh on the american side of this one rather than keep trying to fight the good fight of restriction and control i think it's just i think it's possibly too little too late but let's talk about the uk you think i can access google maps through google search or is that not still not going to let me do that i'm still blocked from doing that no i don't know incredibly annoying you'd have at least 93 banners pop up and uh yeah by the time you got through that you'd probably be at the wrong destination what a giant waste of time all of that was as well then well you could all get a bunch of people in brussels and in law firms and gainly employed but that's it was it was of a of a moment in time yeah really so uk lots of noise as time of press so we are now uh friday late afternoon 4.30 UK time Friday.

25:15And there has been a number of stories in the press that I don't believe have made the levels of noise that they deserve around how much private and public capital is being pumped into the UK. So 25 billion in private investment led by two 10 billion AI growth zones in the North and South Wales. We've got a sovereign AI unit now backed, I think it's backed by James, James Wise is it from Bolton 500 million pound he's not backing it he's chair sorry that's right so this is a fund half a bill to support British AI firms the BBB the British Business Bank has confirmed that they've got NatWest Agon and M &G into a 200 million pound growth fund we're looking at 137 million pound strategy focused on using AI for drug discovery 250 mil into the AIR, the AI, I sound like a pirate, AI Research Resource Procurement to deliver compute.

26:17Equinix, 3.9 billion compute investment in Hertfordshire. Grog, 100 mil, AI Pathfinder, 150 mil, I could go on. It feels like, and I don't know what's PR, what's noise, what's real, what's meaningful, what's not, but to have all of this come into the news cycle this week. I mean, I know that we've got the budget next week, which we are not going to talk about, but is there, this feels real. This feels meaningful. I mean, Lomax, do you want to kick this one off? Yeah. I mean, it's all over my LinkedIn. So, I mean, as people are, people are pushing this out in at least some domains. Look, with all of this, you need to sift through because there is an element of rehashing of old news.

26:56But this is, so there is an element of that. Which the Americans do gloriously. The Airsoftware Unit was established earlier this year, for example, right? So this is not a new thing. But the new half a billion dollar or pound investment scheme and James as chairman are new news. There is a bunch of new news here. It is a good combination of public and private investment here. Let's just step back. In January, government produced or Matt Clifford, who was then working at number 10, produced the UK AI Opportunities Action Plan, which had 50 recommendations, which were unanimously adopted by Keir Starmer.

27:30they had a bunch of recommendations relating to making sure AI does not become, and I think it does not become an AI taker, it becomes an AI maker, was the tagline. And there are a bunch of recommendations around compute, around talent, around investment. This is one of the sort of sub-announcements or pieces of execution underneath that plan. So in a way, many, many government plans get announced with big fanfare and then nothing ever gets done about them. So it's good to see that actually things are being done under this plan. And we had a bunch of announcements made in July, and we now have more made now across a bunch of different areas.

28:11So one is this concept of AI growth zones. So an AI growth zone is a geographically designed area in the UK where the government is creating a special regime to accelerate, you know, build out of large-scale AI infrastructure. Effectively, it's an area where you build a bunch of data centers. it's not a free trade not a free trade zone this is no it's not a free trade zone ai capex it's an ai growth zone it sounds cool but it also ties in so it sounds it's very marketable but also ties in with the government's kind of pushing out you know economic growth to the regions so there's actually been two growth zones already announced and now there are two more one in north wales and one in south wales effectively it's a bunch of data sensors and compute infrastructure so that's great it's what we need as part of it's a core tenet of matt's plan should it be regionally focused or is that just if you have a data center in north wales and south wales i think it's great you know like do you know what i mean like um i'm assuming the coast is the answer here as in they need to be near the sea i don't know i don't know i don't think it's a coastal thing but i think it's like let's go to a place where there's a bit more space they are part of the point of these ai growth zones is that you know we get rid of all the things the nimbies are worried about so we cut all the red tape we speed up planning we make it easier etc so i think that's that's really really good then you've seen the ai sovereign unit which was announced back in july but now has you know james is chairman and has 500 million to invest in in compute sovereignty which i think is is great so basically backing investing in like uk chip startups which is you know they're pretty few and far in between but hopefully there'll be more of them off the back of this and then we have mainly us private companies now investing and starting to put down roots in the uk so perplexity is opening an office in the uk grok is announcing its first data center softbank and graphcore remember graphcore yeah yeah are doubling down on hiring now and in the bristol area so look i i think this is this is really good you know in matt's plan there's going to need to be a series of these announcements over the next two years to actually both announcements and then delivery in a way we can watch the delivery over the over the coming six to 12 months um i think it's good numbers are still quite small i mean there's 135 million announced for ai you know for drug discovery which kind of caught my attention because it's sort of in the one hand it sounds like a lot of money but then i suddenly remembered that that last week or this week profluence in the u.s just working on programmable biology raised 106 million dollar series b or c you know like as in a way like what we're doing here in the public sector is like the u.s is already doing it you know already in the private sector without one business in one one segment in one section yeah but that's fine we need to we need to you know sort of i thought it was big news it felt it felt i mean i don't know if it was meant all these news stories were meant to come out at the same time well of course they are because the budget's next week but it is it deserves more airtime i think i think if this was in any other country it would be much more of a fanfare but mad said anything anything on this before you move on to china i think the hardware advanced market commitment is super cool 100 million put aside for the government to say we're going to be the first customer of some of these chips.

31:20Yes, this is very cool. That's a very good point. That I agree with. It's just like, we need no more grants. Yes, yes. We need customers, we need contracts. So I think that's awesome. I mean, just because we're not all sitting here being cheerleaders. The plan was announced in January. We're now nearly in December. If we want to win, we cannot move at this glacial pace. There's nothing in this plan, I think, that could not have been announced in March. Why do you think it wasn't? because I just don't think His Majesty's government is operating on the timescales of this AI revolution and on the acknowledgement of just how far behind we are compared to rivals in the US and China.

32:00Well, let's talk about China. The other big flurry of news stories was about China. It was based on a quick review of the Busan summit, which was about de-escalating tensions between the US and China. And then there was a lot of opinion pieces about how this folds back into Europe. So Chinese perceptions of Europe are what we would think them to be, that it's too regulated, that we are too slow, and all of the things that we talk about incessantly week on week. But Mads, tell us more about how Europe is perceived through Chinese eyes and what these stories all mean connected together for us. Well, so taking a step back, I think what we saw in the last few weeks was definitively the marking of the change or the heralding of a new world order where it now seems clear that China is America's equal.

32:58Trump, he tried to be very bombastic and kind of slapping tariffs on the Chinese, right? It was sort of almost sort of a fever pitch of what China could do. And so the tariffs were slapped on. And Xi then moved very quickly on the rare earths restrictions, something they haven't been willing to do to quite this extent in the past, quickly forcing the Trump administration to back down to offering concessions. And what China did was merely they postponed the licensing requirement around these rare earth exports for a year. So it's not that they've reversed the scheme, they've just suspended it or postponed it for a little bit.

33:38So they've really forced these supply chain control levers as they have to force a U.S. policy change in a very assertive way, much more than I think we've ever seen before. And this is a new world order. Like, make no mistake about it. And we just have to acknowledge that, I think, as a continent. Now, you know, what's happening elsewhere? I mean, we've seen, obviously, there is a, you know, not a Cold War, but a bloody war on Europe's Eastern Front, right, with Ukraine and Russia. Russia could not have maintained that stance and that salt if it wasn't for collaboration with China. And actually China has installed ammunition production lines in Belarus.

34:19They're producing shell casings there. They have Chinese engineers supervising the production at two facilities. So this impacts the European security situation directly. Now, I don't think, I'm not a big fan of the China bashing. I think we've got to acknowledge that there is, there is a new world order. China is a formidable economic and technological and manufacturing and military power. And we just need to organize ourselves accordingly. But surely we need to work out where we fit in a multipolar world. Well, we spoke a bit about, yeah, I think we've talked about that previously. And I think the only chance we have now is because we're not coming from a position of strength.

35:03It's clear that the Trump administration is not like the transatlanticist administrations of old. And And they're very much about America first and Europe, maybe not even second or third, but somewhere down the line. You've seen in the last 24 hours the peace agreement they're trying to force on Ukraine, which almost amounts to surrender. So it tells us something about what's at stake and how important it is that we move right back to the point we spoke about before at a different level of pace than what we've been able to do in previous decades. You know, go back to 1940, 1941. But if you took 11 months to get from a 31-point plan to actually announcing some initiatives under the plan, I mean, the world would have been lost.

35:55You can't move at this pace. and we are just at risk i think of being squashed between these two behemoths of of china on one side and the united states and the other side if we are not moving with far more um sort of vigilance and speed well the uk and europe seem to be making the noise about moving at speed i'm with you on the actual we're growing right we're growing one percent a year dan we're struggling to reform public finances. We're talking about a budget coming up in a week which offers seemingly nothing but tax rises, no real reform. I don't know where you see this speed. Spain is the fastest growing economy in Western Europe, which is basically driven by tourism.

36:41That's the thing. Interesting. Interesting. The US is growing at whatever, 3%. I mean, half of it's driven by AI, but I mean, yeah, one's driven by AI, one's driven by tourism. Does that tell you enough? you look at well i'd rather have the ai bit not at all all costs i know you like sangria but still i do but if you strip out if you do strip out the um mag 7 or any any of the ai related businesses from the s &p that obviously the growth rate halves i i'm very wary of looking in rear view mirrors and europe bashing because it is also fair to say that anything is going to take time any policy change is going to take time to show in the figures and i'm hopeful that there are some meaningful changes that will make make a difference and i think we have listen i agree with you i just we just i just don't want us to be cheerleaders right and i think it's perfectly fair to say on one hand yes great right direction now let's move faster yeah yeah we can we can want it to happen but it needs to happen faster let's look at some of these things because just quickly by the way Dan, sorry, before we go into that, did you guys listen to Palmer Lucky spending three hours with Joe Rogan?

37:53I'd encourage that. Two, there's many, many takeaways from that. But one, as a reminder, you know, Palmer is obviously founder and CEO of Anduro, which now values$63 billion. It's like doubled from the, it's crazy. He was the old Quest guy, wasn't he? He wasn't the old Meta guy that fell out of Oculus. The Oculus from his bedroom, basically, and sold it to Facebook. And then, you know, he got fired from Meta for donating to Trump. Like how things have changed. And all those tech guys were at Trump's inauguration. Don't forget that. I saw him being rinsed by, who was it on the all-in? Was it Jason Calacanis that he absolutely took to pieces for giving him a hard time and taking the mickey out of him?