The European AI Exodus (and the Soldiers Who Stayed Behind)
Issue #2545.4 / November 4, 2025
Hi There 👋
If you’ve been paying attention to Silicon Valley lately, you might have noticed something peculiar: OpenAI is spending money like a tech company that just discovered its credit card has no limit. On Monday, the ChatGPT-maker announced a $38 billion (€33 billion), seven-year deal with Amazon Web Services, adding yet another hyperscaler to its growing collection of cloud partnerships that now includes Microsoft, Google, Oracle, and CoreWeave. At this rate, OpenAI will soon have more cloud providers than most people have streaming subscriptions.
But here’s where it gets interesting — and slightly terrifying if you’re a cloud provider: OpenAI has now committed to approximately $1.4 trillion (€1.2 trillion) in data center-related spending, including a $300 billion (€260 billion) Oracle deal and commitments to Microsoft worth around $250 billion (€217 billion). That’s trillion with a T. For context, that’s more than the GDP of most countries. Someone needs to have a word with Sam Altman about impulse purchases.
The AWS deal gives OpenAI immediate access to hundreds of thousands of Nvidia GPUs, with all capacity targeted for deployment before the end of 2026. It’s OpenAI’s first major contract with AWS since Microsoft’s preferential status expired last week under newly negotiated commercial terms, freeing the AI startup to partner more widely with other hyperscalers. Think of it as OpenAI’s awkward teenage rebellion phase — still living in Microsoft’s basement but dating other cloud providers on the side.
The Silicon Valley Siren Song
While OpenAI is busy collecting cloud contracts like Pokémon cards, European AI startups are facing a different kind of existential crisis: should they pack their bags and head west?
According to a new survey from Sifted, almost a quarter (23%) of Europe’s most promising AI startups are considering relocating to the US. The reason? It’s not the sunshine or the burritos — it’s the brutal competition for talent that’s threatening their ability to scale.
The survey, which polled 75 of Europe’s top AI startups valued under $1 billion (€868 million), revealed that difficulty accessing talent was consistently cited as the biggest blocker to growth. And who can blame them? US companies are aggressively expanding into European markets with substantial resources and competitive compensation packages that make European salaries look like pocket money.
“It’s almost a foregone conclusion that once European startups reach $10 million to $20 million in revenue, they’re going to move to New York, San Francisco, or Austin,” says Ben Fletcher, a partner at VC firm Accel. The pattern has become so predictable that you could set your watch by it.
The math is simple but sobering: the AI startup ecosystem in Europe is just 15% to 20% the size of Silicon Valley’s. Meanwhile, generative AI companies clinched $49.2 billion (€42.7 billion) in venture capital in the first half of 2025 alone, with the US responsible for 97% of deal value while Europe represented just 2%.
But before European policymakers start panic-buying one-way tickets to convince founders to stay, there’s a twist: record VC investment is flowing into European AI, with €7.8 billion raised in equity funding this year, already surpassing 2024’s €4.4 billion. The money is there. The question is whether it’s enough to compete with American hypergrowth dynamics that have even received an extra boost under the Trump administration.
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When Soldiers Become CEOs
While AI founders agonize over whether to swap their flat whites for cold brew, a different kind of European entrepreneur has been quietly building an empire — and they have no intention of leaving.
Meet Europe’s defence tech boom, led by an unlikely cast: former soldiers, NATO executives, and military veterans who’ve traded fatigues for founder titles. Veterans now lead a quarter of Europe’s 80-plus defence startups, bringing battlefield experience to boardrooms in a sector that has exploded since Russia’s invasion of Ukraine.
The numbers tell a remarkable story: European defence tech has already secured $1.5 billion (€1.3 billion) in funding in 2025, making it the most active year ever for the sector. VC investment in European defence tech hit $5.2 billion (€4.5 billion) in 2024, up over 500% from pre-war levels. Defence tech now accounts for 6.2% of all European VC funding, up from less than 1% before 2020.
Consider German defence startup Helsing, which raised €600 million in June — the largest round for a European defence startup ever. Or take Marc Wietfeld, a former German officer who founded ARX Robotics, which makes unmanned ground vehicles. His secret weapon? Military experience that helps him iterate software stacks every two to three weeks — a speed traditional defence contractors can’t match.
“You can’t solve a problem you don’t know — one you’ve never felt yourself,” Wietfeld told Reuters. It’s a sentiment echoed across the sector. Former Royal Marines commando August Lersten cofounded workforce management platform Labrys Technologies, while Norwegian Armed Forces veteran Christian Fredrik Eggesbø launched drone software platform Six Robotics.
There are even more unusual profiles. Mal Crease spent nearly 20 years in boat racing before founding Kraken Technologies to build unmanned maritime vehicles. And in Ukraine, Viktoriia Yaremchuk pivoted to defence tech when she cofounded drone startup Farsight Vision in Lviv — technology that’s since been adopted by the Ukrainian Armed Forces.
The veteran advantage goes beyond technical know-how. “Veterans see firsthand what solutions are missing on the battlefield,” says Francisco Serra-Martins, an ex-Australian Army combat engineer who cofounded Ukraine-based Terminal Authority. “You understand the user, the constraints, and what will or will not be adopted. It is also a credibility builder with customers.”
This matters more than you might think. One Ukrainian soldier described how an unmanned vehicle that “looked great on paper” failed at the front lines, wasting €300,000. “I wish more companies were founded by military people,” she told Reuters.
In Other News
Tesla’s Cybercab confusion: CEO Elon Musk and board chair Robyn Denholm can’t seem to agree on whether the company’s robotaxi should have a steering wheel. Denholm says it can have one if regulators require it; Musk says absolutely not. Nothing says “ready for production” quite like fundamental design disagreements between your CEO and board.
European AI agents are booming: Swedish AI darlings are topping the list of Europe’s fastest-growing agentic startups by headcount, riding a wave of investor interest. Startups developing AI agents have raised €5.2 billion this year — nearly double the €2.7 billion raised across all of 2024.
UK aims to become European AI hub: While some European AI companies eye the US, many are choosing the UK as their European base camp. London offers global business infrastructure, investor networks, and easier access to international markets — proving that sometimes the grass is greener just across the Channel. Let’s see if anyone bites.
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