Upside Ep #65 - A Baltic Boom, Matt Clifford Rouses, A Tale Of Two Quants

A weekly show that unpacks the shenanigans affecting European venture.

Dan (host), Mads, Lomax, Special Guest: Jone (Yo neh) — Managing Partner, First Pick (Lithuania)

3:26 — Pre-seed vs Seed in the Baltics
•Why pre-seed fits: seed still feels early; when companies inflect, foreign funds out-gun local check sizes. Funds in region typically €10–€100M AUM, so Series A+ is handed off.

05:39 — Foreign funds’ interest & “guarding the land”
•Active sharing with bigger EU funds; Creandum dinner takeaway: Baltics are insanely good at distribution; product/elite-tech depth thinner than popular myth, but revenue ramps fast.

07:29 — Baltic bootstrapping culture
•Many regional champions are bootstrapped (e.g., Hostinger, Kilo Health, NordVPN/Tesonet group influence). Venture is used sparingly; winning a VC spot is hard as rounds are scarce/oversubscribed.

10:49 — Defence: Rheinmetall–Lithuania invests €300m
•Facts: €300M JV; Baisogala site; ~340 ha footprint; ~150 jobs; ground-breaking 4 Nov 2025; ops start 2026 with ramp in 2027.
•Why Lithuania? Panel view: incentives, speed, and financing (tax holidays, fast-track planning, heavy local co-funding) plus NATO signaling despite border-risk optics.

15:15 — Matt Clifford @ LFG: “Permissionlessness” & the stagnation decade
•Vibe check from the room: energising, pro-growth, anti-bureaucracy.
•Core claim discussed: ~17 years of UK productivity stagnation → lost income per head; call to cut red tape and celebrate building.
•Reflexive critique: does it resonate beyond London; EF’s Delaware flips vs UK nation-building narrative tension.

29:26 — Quantum UK - Can we?
•FT-sparked chat on UK/EU quantum software (e.g., Phasecraft, Riverlane) and hardware roots (PsiQuantum, Quantinuum) with UK lineage; big valuations, long road to revenue.

32:09 — Quants (trading): Yes we can!
•UK bright spot: quant trading still world-class; XTX building a ~25k-GPU cluster (context: new German “AI factory” cited at ~10k GPUs).
•Talent gravity: CS/math grads pulled into quant comp; debate on startup talent crowd-out vs recycling (e.g., XTX backing AI seeds).

39:57 — AI Corner
•Funding loops & hyperscaler deals: OpenAI multi-year cloud commits; when is it circular vs normal vendor financing? Panel splits hairs on cash vs credits and market discipline.
•CALM (China): continuous autoregressive idea = interesting/iterative step, not a “DeepSeek moment.”
•OpenAI & legal: limiting in-app legal advice framed as product direction/lead-gen potential for pros.
•Nvidia + Deutsche Telekom: ~€1.2B / ~10k GPUs in Germany—welcomed, but scale gap vs US mega-centres.
•Nebius “Token Factory”: EU-HQ’d “neo-cloud” (Yandex spin-out context) aggregating low-cost OS models; compelling for cost-sensitive workloads if 95–99% “good enough.” (Regional perception note: in Baltics it’s still seen as “Russian-adjacent”, brand kept intentionally low-key.)

53:53 — Deal(s) of the Week)
•Nexus AI (LT) — $8M on deck from Index, followed swiftly by Avantar/Creandum; Tesonet/NordVPN founders; routing/LLM infra for companies; signalling win for Vilnius scene. (Raised on deck, then followed up quickly.)
•Poolside (FR/US) — Rumoured $2B round; Nvidia up to $1B; valuation jump $3B → $12B; deeper code-gen/automation focus; meaningful transatlantic footprint.