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CNBC
08-07-2025
- Business
- CNBC
VC behind '996' work culture debate says 5-day weeks won't build billion-dollar startups
Venture capitalist Harry Stebbings faced a wave of backlash in June after urging European startup founders to increase their work hours — but he now admits there's some room for nuance when applying his mantra. Stebbings, founder of 20VC, a firm managing $650 million in funds, advised founders on LinkedIn last month that "7 days a week is the required velocity to win right now," to compete with startups in Silicon Valley and China. The post went viral, to Stebbings' surprise, and sparked a debate on whether China's brutal "996" work culture is needed in Europe. The conversation is rooted in a persistent stereotype that Europe's tech and startup scene is lagging behind the U.S. and China, which have produced trillion-dollar tech giants and are known for implementing long working hours. The U.S. is home to the biggest tech firms in the world, such as Meta, Google, Amazon, and Apple. China meanwhile houses giants like Baidu, Alibaba, and Tencent. Seven founders and VCs shared why they're resisting the 996 push with CNBC Make It at the time. "What Europe really needs isn't more hustle-porn, it's more aggressive funding," Sarah Wernér, co-founder of Husmus, said back then. Speaking to CNBC Make It about the fallout, Stebbings said that he wasn't prepared for the criticism he received, and that his original post didn't apply to the vast majority of people who responded. "I think it's everything that's wrong with Europe, that backlash," Stebbings said. "We are fighting against companies being built in Silicon Valley, and speed and the ability to move fast, really determines success, in AI especially." He added: "When you go to the Valley now, and when you go to China now, they are working seven days a week in the fastest-growing companies. It's that simple. So, if you want to be a $10 billion company in Europe, competing against them, you can't do it on a nine-to-five, Monday to Friday." As companies build more important products, Stebbings said the bar is higher than it used to be. "We should be working harder than ever because we're working to solve more important problems than ever," he said. But European startups are struggling to access funding at the growth stage. Atomico's State of European Tech report of 2024 showed that, since 2015, Europe's tech startups have missed out on nearly $375 billion in growth-stage funding, with founders losing out on a potential $300 billion in European investments. Husmus' Wernér said that the right level of capital is needed for European startups to work intensely without breaking themselves. "If a team of 10 is burning out to keep up with a 50-person U.S. VC or Chinese government-backed startup, the problem isn't their stamina, it's their cap table." However, Stebbings pinned this down to poor marketing and said Europeans aren't great fundraisers compared to their American counterparts. "I don't think it's a lack of access to cash at all, and in terms of the work ethic there, if you think that you can build a $10 billion business and work five days a week, then I'm sorry to say, you're deluding yourself." Some founders have even been "badly" advised to include exit slides in their pitches, he added. "That makes me feel sick, like I'm planning my divorce when I get married." In stark contrast, Americans are much better at telling exciting stories when they promote their businesses. "I think, often in the U.K., we downsize in ambitions." Ultimately, Stebbings admitted that he jokes with the "marketing facade" of 996, but that it's a more nuanced picture than working all the time. "I think that's [996] very ignorant to do," he said. "if you don't allow people breaks in there and a gym workout, it's just moronic." Stebbings said that 100% dedication is essential in the first five years — but that doesn't mean abandoning health, wellness, and family. "There is nuance. I'm not saying miss dinner with friends or family or just sit at your desk all day, and I'm some horrible person, absolutely not. It's really important to turn off and have a couple of hours away from your computer and just be with friends." Stebbings himself tries to spend as much time as possible with his sickly mother, who has multiple sclerosis (MS), including walking a marathon with her every Sunday. He jumps straight back to work after. But it's unrealistic to expect employees to adopt the same attitude, he acknowledged. "One of the hardest things about running a company is you will never find someone who cares about it as much as you do, the founder… I think it's unreasonable to ever expect that they will work as hard as you." Suranga Chandratillake, general partner at Balderton Capital, previously told CNBC Make It in June that the focus on hustle culture in the tech industry is about "a fetishization of overwork rather than smart work…it's a myth." He said: "California is very good at telling stories, and there's a lot of mythmaking around the concept of what startups look like." Stebbings now agrees with this view and said hustle culture is "over-glamorized" in the States. "If you go into a WeWork in San Francisco at 7 p.m., they're not all working like we see on social media... they overly pronounce it when it's not really true, but for the 0.01% in the Valley, it's so true, and they are there and working harder than ever."
Forbes
29-03-2025
- Business
- Forbes
Venture Capital's Dangerous Divide: The $6.6 Billion Mega Deals And Everyone Else
For elite VC investors backing companies like OpenAI and SpaceX, 2024 has been an amazing year with multi-billion-dollar deals and sky-high valuations. But step outside this exclusive circle, and you'll find a very different story—especially in Europe, where funding has dropped to less than half of what it was in 2021. Money is now going mostly to a few famous companies, creating a clear split between winners and losers in the global startup world. This division is changing the innovation landscape in major ways. Founders, investors, and entire tech regions need to understand these changes to survive in today's venture capital reality. The 2024 numbers reveal two completely separate venture capital markets operating at the same time. According to Crunchbase, North American funding jumped in late 2024, driven mainly by AI deals and billion-dollar investments in established companies. Meanwhile, European funding fell to $51 billion in 2024, down 5% from $54 billion in 2023. "European tech funding has stabilised at $45 billion in 2024 after a significant drop in 2023," reports Atomico's State of European Tech 2024. This is less than half of the $100 billion peak reached in 2021. This decline isn't hitting everyone equally. Early-stage companies are suffering the most, with seed-stage funding dropping 18% compared to last year, according to Crunchbase's mid-2024 data. By the end of 2024, things got even worse, with seed funding down 29% compared to the same period in 2023. The contrast with late-stage funding is clear. While early-stage rounds struggled, late-stage funding in North America grew 23% year-over-year in late 2024, showing how money is increasingly going to safer bets. What's causing this split? A major factor is the huge concentration of money in a handful of massive deals that have taken most of the available investment dollars. Over the past year, companies like OpenAI, Anthropic, Anduril, SpaceX, and Databricks have dominated fundraising, securing multi-billion-dollar rounds: These mega-deals are changing how venture capital flows globally. While Europe raised $51 billion across all of 2024, the U.S. market saw funding go past $140 billion, with these headline-grabbing deals capturing most investor attention and dollars. "Europe's share of global VC funding fell to 16% in 2024 from 18%," Dealroom reports, suggesting that these mega-deals, mostly in the U.S., are pulling money away from other regions and companies. For these top companies, fundraising has fundamentally changed. Money is now like a commodity—investors offer similar terms, and the difference often comes down to who can invest fastest and with the largest amounts. This creates a cycle that further concentrates investment. As Atomico notes, "startups raising larger rounds at earlier stages are seeing higher valuations," meaning that for top-tier firms, money is plentiful and terms are similar across investors. The largest European funds are trying to compete in this environment. Sifted reports that "the biggest VC funds in Europe have got bigger—Balderton raised $1.3 billion and Atomico $1.24 billion in 2024." These funds aim to invest in the most promising companies at scale, suggesting a race to invest rather than a careful selection process. However, even Europe's largest funds can't match their U.S. counterparts. The IMF highlights this gap, stating that "Europe lags the U.S. in the scale of VC funds," with U.S. investors putting in $140 billion in 2024 compared to Europe's $45-51 billion. This new reality is creating serious challenges for the rest of the venture ecosystem—especially in Europe, where VC activity has sharply declined. Mid-2024 was Europe's lowest funding quarter since 2020, with just $10 billion raised, down 36% from the previous quarter and 39% from the same period in 2023, according to Crunchbase. This sharp decline signals trouble across the ecosystem, particularly for smaller players. While the largest European funds have grown, smaller funds are "struggling to raise capital," creating a market where only the well-connected succeed. This threatens innovation across the continent, as the IMF warns: "Europe's lag in VC scale risks undermining its tech competitiveness." European funding stabilizing at around $45 billion in 2024—far below the $100 billion+ peaks of 2021—highlights a broader challenge for the region as global money goes to safer, more visible bets elsewhere. Early-stage tech deals have been hit especially hard by these changes. Crunchbase reports that in mid-2024, "seed funding fell 18% year-over-year," while early-stage funding overall dropped 12%, marking the "lowest quarter since Q3 2020." By the end of 2024, the situation worsened: seed funding hit $1.6 billion, down 29% from the same period in 2023, and early-stage funding reached $5.1 billion, down 7%, showing a continued squeeze on the newest ventures. This downturn reflects a shift in investor priorities, leaving Europe's young startups particularly exposed. Dealroom's data confirms that "early-stage investment in Europe remains below historical highs," with 2024's €47 billion total going more toward later stages, not seed. The consequences go beyond immediate funding challenges. As seed and early-stage investment shrinks, the pipeline of future growth-stage companies narrows, potentially limiting innovation and economic growth in the years ahead. For founders, investors, and policymakers, adapting to this transformed venture landscape requires clear strategy and decisive action: The transformation of venture capital from a diverse ecosystem to a market dominated by mega-deals represents a fundamental shift, not a temporary change. The effects will impact the innovation economy for years to come. For Europe, the challenge is especially serious. As Dealroom notes, with funding levels "far below the 2021 peak of €100 billion," the region faces tough questions about its ability to compete for capital in a global market increasingly drawn to scale and visibility. Yet within this challenge lies opportunity. The concentration of capital creates gaps in the market that nimble, specialized players can fill. Founders with truly different technology and clear paths to profitability can still raise money, even in a more selective environment. The venture capital industry is indeed undergoing a transformation—one that is leaving much of the industry behind. But transformation also creates new winners. Those who understand the new rules and adapt will find ways to succeed, even as the mega-deals continue to grab headlines and dollars.
Yahoo
06-02-2025
- Business
- Yahoo
European VC firm Emblem raises $85 million for its initial fund
Emblem, a relatively new European VC firm based in Paris, is announcing the final closing of its first fund. Eighteen months after the first closing, the Emblem team managed to secure €80 million in total (around $85 million at current exchange rates). This is no small feat in the current funding environment. According to Atomico's latest State of European Tech report, in 2024, venture funding fell for the third year in a row. One of the main reasons for this is that acquisitions and IPOs aren't really happening right now. As a result, VC as an investment category is less attractive than it used to be. Several VC firms are struggling to raise follow-on funds despite the current artificial intelligence boom, which could potentially represent a huge investment opportunity. But that didn't stop Emblem from reaching its hard cap — the maximum amount that it had originally set to raise. Founded by Bénédicte de Raphélis Soissan and Guillaume Durao, the duo had already made some interesting investments as business angels before creating Emblem. They invested in crypto trading card game Sorare, pet insurance startup Dalma, and cultivated meat company Gourmey, to name a few. They wanted to go one step further with a proper VC firm, which to Emblem, a seed investment firm that wants to make 25 to 30 investments with its initial fund. Ideally, they would rather lead or co-lead seed rounds with tickets ranging from €500,000 to €3 million. But the firm is willing to follow another lead investor if there's a good opportunity, too. Emblem has already invested in 16 startups since its first closing in March 2023. TechCrunch has covered a few of them. Examples include: Pivot, a procurement tool and Coupa competitor. The Mobile-First Company, a B2B mobile app studio drawing inspiration from Voodoo and other consumer app studio. Altrove, a new materials company using AI and lab automation to speed up research. Volta, an online commerce platform like Shopify, but focused exclusively on B2B transactions. It's a diverse portfolio when it comes to area of focus, but also geographical focus. 'We've made 16 investments. To give you an idea, there are eight of them in France, six in the Nordics — Denmark, Sweden — and then we made one in the U.S. and one in Italy,' de Raphélis Soissan told TechCrunch. Emblem's core focus remains on France and the Nordic tech ecosystem. It has more than 200 limited partners who invested in the first fund, including family offices and tech entrepreneurs, such as the founders of Unity, Pleo, Qonto, 3shape, Spendesk, Voodoo, Pennylane, JobandTalent, Ledger and Zendesk. They make up for over half of the total amount. The rest has been raised from several funds of funds, as well as commitments from both EIFO (the Danish sovereign fund) and Bpifrance (the French sovereign fund). Emblem is already thinking about its next fund, which should be roughly the same size as this one. 'Now we've got a bit of time when we won't need to raise. So we're going to savor it. But you never want to be off-market,' de Raphélis Soissan said. 'So, since it takes you four years to deploy, and we're about halfway through, that means that in a year's time, we'll have to start all over again.' Sign in to access your portfolio
