EP 123 - Navigating the New Era of European Innovation with David Dana

🚀 Europe's Tech Transformation: David Dana's Vision for the Future!

In this episode, join me, Christian Soschner, for an enlightening conversation with David Dana, a leading figure in the European tech investment landscape. Discover how his strategic approach at the European Investment Fund (EIF) is driving innovation and shaping the future of technology in Europe.

🎙️ What's in the Episode:
1️⃣ Europe's Growing Tech Influence: David Dana discusses Europe's evolving role in the global tech market and its potential to become a key player.
2️⃣ The Art of Risk and Reward: Explore how embracing risk is essential for significant returns in the European investment scene.
3️⃣ Quantum Tech Revolution: Insights into the burgeoning field of quantum technologies and its global impact.
4️⃣ Collaborative Tech Transfer: Understanding the importance of openness in tech transfer to enhance ecosystem value.
5️⃣ Beyond Investing: Learn about EIF's strategic approach to deploying capital for broader market growth.

👨‍💼 About David Dana:
David Dana, Head of VC Investments at EIF, is a mastermind in disruptive tech and innovation. With over a decade of experience at EIF and a profound understanding of various tech sectors, David is at the forefront of supporting Europe's tech sovereignty. His expertise in AI, Blockchain, Space, and Quantum Technologies, among others, is driving Europe's tech revolution.

🎥 Don't miss this insightful episode where we delve into the strategies and visions shaping Europe's tech future with David Dana. Tune in now to uncover the transformative power of European innovation.

💡 LINKS TO MORE CONTENT
Host: Christian Soschner

📌 Quotes:
(00:06:42) "Europe has a role to play in the global market."
(00:27:34) "If you don't take the risk, you will not get the rewards."
(00:34:50) "Quantum technologies are at the beginning of something potentially huge."
(00:46:25) "Opening to other shareholders helps to value and support the ecosystem more effectively."
(01:04:16) "We need to generate returns; it's not just about deploying, it's about investing."
(01:20:30) “Europe has the capacity, knowledge, and brains to innovate and change the world.”
(01:27:51) "We need to empower others by trusting them, giving them autonomy and responsibility."

⏰ Timestamps:
(00:03:00) Discovering the European Investment Fund: David Dana's Journey
(00:06:10) The Evolution of the European Tech Market: Insights from David Dana
(00:17:46) Navigating Risk in Alternative Investments: David Dana's Perspective
(00:21:05) The Exit Market Challenge: Europe vs. US in Venture Capital
(00:31:45) Cultural Shift for European Innovation: Breaking National Barriers
(00:34:50) Quantum Technologies: The Potential for Revolutionary Impact
(00:45:50) Early Stage Funding and Tech Transfer in Europe: Challenges and Opportunities
(00:48:32) Balancing Global Expansion and European Growth: Strategies for Tech Companies
(00:59:30) Convincing Success: The Key to Gaining EIF Support
(01:06:11) Navigating the Investment Process: EIF's Rigorous Due Diligence Approach
(01:12:50) EIF's Rigorous Investment Process: Ensuring Quality and Due Diligence
(01:24:32) Evolving Role of EIF: Focusing on Specialized Strategies in Europe
(01:25:31) Empowering Teams for Decision-Making
(01:38:15) Navigating Investment Successes and Failures
(01:40:17) Confronting the Future with a Brave Initiative
(01:50:19) Fos

Transcript

00:00:00:00 - 00:00:31:15

Christian Soschner

Imagine a future where Europe leads the world in technological innovation. Harnessing the power of deep tech like artificial intelligence, blockchain technology, biotech or quantum physics. This vision is not just a dream. It's the mission of today's guest, David Dana, a pivotal figure in shaping Europe's tech landscape shape.

00:00:31:15 - 00:00:39:04

David Dana

You know, there used to be this kind of current thing where people say, yeah, us innovate time that copies and your prejudice.

00:00:39:09 - 00:00:40:20

David Dana

It's not the case anymore. You know,

00:00:40:20 - 00:00:43:05

David Dana

if you don't take the risk, you will not get the rewards.

00:00:43:05 - 00:00:57:04

David Dana

it's investment, it's not deployment. So we are making investment decisions based on the whole analysis. Would we be 100% right? No, it could be. But we hope that it's investment for each of the cases.

00:00:57:14 - 00:01:10:21

Christian Soschner

David Stana is the head of venture Capital Investments at the European Investment Fund and he's at the forefront of driving Europe's technological sovereignty.

00:01:10:21 - 00:01:31:06

Christian Soschner

With over a decade at the European Investment Fund and a deep commitment to disruptive tech, Dana has been instrumental in deploying significant investments across Europe, focusing on sectors like artificial intelligence, biotech, quantum technologies and blockchain.

00:01:31:08 - 00:01:40:12

Christian Soschner

This episode offers a deep dive into five key areas that are reshaping Europe's tech future.

00:01:40:12 - 00:01:49:04

Christian Soschner

The first one is Europe's growing role in the global tech market, with insights into its evolving significance.

00:01:49:04 - 00:01:59:18

Christian Soschner

The second one is the art of risk and rewards in venture capital, meaning understanding the balance in the European investment landscape.

00:01:59:18 - 00:02:04:24

Christian Soschner

Number three is the revolutionary potential of quantum technologies.

00:02:05:01 - 00:02:28:10

Christian Soschner

Exploring the beginnings of a global impact. Number four The power of openness in tech transfer. How Sharing ownership can enhance ecosystem growth. And the fifth point the importance of strategic capital deployment. Beyond investing, it's about impact for deployment.

00:02:28:10 - 00:02:38:19

Christian Soschner

If you're keen to understand and navigate the transformative European tech landscape, this episode is a must watch.

00:02:38:19 - 00:02:46:04

Christian Soschner

Subscribe, comment and share to help continue delivering insightful content like this for free.

00:02:46:04 - 00:02:53:09

Christian Soschner

Your support is crucial in growing this show and bringing more value to you. The audience.

00:02:53:09 - 00:03:07:16

Christian Soschner

Watch the entire episode to grasp the full scope of David Steiner's vision and the European Investment Funds role in catapulting Europe to tech leadership on this planet.

00:03:07:16 - 00:03:12:02

Christian Soschner

How did you how did you get to the European Investment Fund?

00:03:12:04 - 00:03:33:07

David Dana

So it was the first time I got in. I got to know exactly what the EGF was. At the time, I was still working with friends and associated another group and I attended one of these meeting and I met a guy from the European Investment Fund and it seemed a bit not weird, but I wanted to know more about what it was.

00:03:33:09 - 00:03:58:10

David Dana

So I started investigating it and then I realized that it was something quite interesting. And then I moved to Luxembourg to join people. But you see the corporates in governance practice and why they were there. I had in mind that my objective would be to try and join the European investment spending more specifically into this team, which took a bit of time to be frank.

00:03:58:11 - 00:04:30:04

David Dana

And you know that sometimes we are not that quick. It was already the case of Sephora hiring at the time, but I met a lot of people from the team and the ultimate team applied. There was no one position that just applied to interviews with many people on the team and again took some months at least before we ended up just receiving a bit from the where I would say over my emails.

00:04:30:06 - 00:04:47:00

David Dana

I was a bit surprised, so surprised, especially as it took so much time that I just get on the record thinking, you're sure it was for me? Just thinking that it was maybe a mistake. And so is this for you? It's you are fine with that. We can just agree on something, which is what we did quite quickly, I would say.

00:04:47:02 - 00:04:52:17

David Dana

And I then started walking in victims since day one in September 2000 that.

00:04:52:19 - 00:05:06:05

David Dana

Was intended so over 13, almost 15 years ago. And what what kept you for over 13 years? That's the European Investment Fund. What motivates you doing this job every single day?

00:05:07:02 - 00:05:30:19

David Dana

A number of elements. First of all, I would start with something which I hoped would not happen and didn't happen. It was a kind of political pressure, meaning that my CEO and I think, do you know what we could be doing without the means and the organization behind us? I was just skeptical on whether there would be a lot of political pressure to make or look make some changes.

00:05:30:21 - 00:05:50:12

David Dana

And at the end, I see something which I liked very much, that there is a there is sometimes some political pressure, but as long as you explain it, justify why you make a decision, a positive or a negative one. And that's always been supportive. And this is something which gives you a lot of freedom in what you do, which is something I appreciated.

00:05:50:14 - 00:06:17:03

David Dana

But besides that, what what has kept me so long? Let's hear that first of all, the market has evolved a lot and I've seen the role of evolving a lot as well. When I joined again in 2010, we will sit on the varsity making two or 300 million a year of investments into these effects across Europe, and it used to represent 40 45% of the whole European market.

00:06:17:16 - 00:06:45:04

David Dana

The last year we invested a bit more than €3.4 billion. We are almost 50 in the team and this represents maybe 15 to 20% of the market. So the market has grown a lot, mainly in very positive ways. We have seen a lot of successes at companies level, at the levels of these levels. And we see also a lot of attraction from this market to non-European investors because there are lots of good opportunities.

00:06:45:06 - 00:06:50:00

David Dana

And Europe has definitely a role to play in the overall and global tech market.

00:06:50:10 - 00:07:09:12

David Dana

I hope so that Europe plays a role. I think it was more prominent in the nineties on the tech markets then. I think we missed a little bit the digital revolution and unfortunately it didn't create a precedent. Microsoft, my question to you is how do you see the role of venture capital on the European landscape these days?

00:07:09:14 - 00:07:36:21

David Dana

Yeah, I think it's it's related to the IGF mission. Like today when the U.S. was created, the objective was to support and is to have the case to support innovation and job generation within the EU. And if you look at the number of SMEs, so small and medium enterprises which are making the economic framework of the EU, it's more than 90% of the companies are established.

00:07:36:23 - 00:08:20:20

David Dana

Many of them, once the, you know, the more successful of the ones which have embraced the digital revolution in a way and which are also they are now developing that kind of, as we call them, disruptive technologies to continue. And the leading is a wave for Europe to remain at the forefront of innovation. And that's something which I appreciate a lot as well, is that we are interacting with a lot of people from very different backgrounds, from purely financial kind of background entrepreneurs, technical guys, and we manage out of that and we manage to make it a good place for entrepreneurship in Europe and to support a lot of interest related to technology.

00:08:20:22 - 00:08:44:09

David Dana

We cannot do anything just by yourself, but at least as a European institution with a significant financial means coming mainly from the EIB and the European Commission, we have the means to have an impact and to help the market to to set up a system for good practice, but more importantly to support some specific. You see mathematics.

00:08:44:15 - 00:09:09:03

David Dana

And you give a little bit of perspective of the European Investment Fund on the term technology, deep tech biotech I'm coming from this angle is that I read an article yesterday where I read you have deep that creative digital tech. We have biotech and I think the terms are very broadly used. Yes, it would be helpful to have if your definition of how you see the tech sector in Europe.

00:09:09:05 - 00:09:09:16

Christian Soschner

Yeah.

00:09:09:16 - 00:09:37:00

David Dana

So first of all, indeed, we keep some of those seem quite broad in definition to avoid being in that kind of a risk based selection, meaning that we just don't want we don't want to have a kind of a box ticking approach. We are making investment decisions. This is something people have to understand. It's not because what you want to do fits with the policy objectives of the IMF or the European Commission that we will invest in your proposal.

00:09:37:02 - 00:10:04:14

David Dana

We are here as investment as an investment team to make investment decisions, meaning that we combine both of those policy objectives, but also the financial expectation perspective, which means that we make and we try to make sure to the extent possible that the projects we support, the ones which are the best equipped, the better equipped to generate course, the highest possible results on those two objectives.

00:10:04:16 - 00:10:38:17

David Dana

So that's something easy, but that's something we we have in mind on a day to day basis. And indeed we are actively involved in terms of innovation. We have split our team in the basically two main departments and which are split again in a number of teams depending on the different thematics we have on one side, the technology one which is made of in this thing related to most of what we call digital and communication, but also which is one of the team we have.

00:10:38:19 - 00:11:10:10

David Dana

The other one which I'm heading, which is called Disruptive Technologies, a Vision which is more about technology, innovative tech. We mean all those sectors which have been identified as being strategic for the technological sovereignty of the European Union, and it got a very large number of sectors, starting with France in space and with space economy. But you also have blockchain with 3D role cybersecurity, semiconductors, new technologies, industrial tech, a lot of things.

00:11:10:16 - 00:11:32:13

David Dana

And on the other side we have what we call the more generic term impact investments, but still related related to technology. One of the team being focusing on social impact, the other one on climate and the environmental impact. Then we have introduced us to a team and the last one, which is called Life Sciences, which I think could be in between.

00:11:32:15 - 00:11:57:05

David Dana

So these are the kind of sectors indeed we are covering. You know, for instance, talking about what is the definition. Let's say it's quite broad stuff from discovery to medical. So it's quite broad. And again, it's done in purpose to keep those definitions broad so that when we find something of quality, we have hopefully the means to support it.

00:11:57:07 - 00:12:12:15

David Dana

And that is a guide. Promoting these initiatives is great, but so really that you don't fit into this. And so there's a mandate for that specifically that. So we prefer to have something a bit broader and up to us then to make the good investment decisions.

00:12:13:05 - 00:12:35:11

David Dana

I'm curious to learn more about your investment style of the European Investment Fund. You have a a wealth of experience from PricewaterhouseCoopers to Societe Generale. And when I try to remember the times of the nineties, I'm now close to 50. So I was a student in the nineties. Everything was about the internet back then. Then we moved forward.

00:12:35:13 - 00:12:57:13

David Dana

I got into biotech life sciences, then everything was suddenly about blockchain and artificial intelligence. Then we had lots of the digital revolution. And I'm sure that your experience is the same like venture funds, that you have a wealth of opportunities on the market and many people approach, you know, to your prioritize your investments.

00:12:58:05 - 00:13:32:00

David Dana

So there are a couple of different aspects to this question. The first one is we don't want to go for heights, so we go for things which first of all makes sense and for which there is a market to it. If there's no market demand either, the strategy is too late or too early. So we go for where we can, again, to the extent possible, to make sure that there is a market demand opportunity to make investments that are investments and to generate profit because of the disruption to their profitability and distills.

00:13:32:02 - 00:14:05:10

David Dana

And, you know, it's not a sustainable because at the end I don't hope that I will be completely redundant, but it would be great indeed, especially for more established teams to rely a bit less on public funding and being able to attract mainly, but only the private investors. We know, especially in Europe, it's still not the case, not that we don't like to beg them, but it's a question of having this ecosystem being again viable and profitable enough to attract those maybe financing from private investors.

00:14:07:16 - 00:14:34:10

Christian Soschner

But I go back to the nineties, always had the feeling with the mobile revolution that Europe is playing at par with the United States and then suddenly China evolved after it after 89. And I think that did a lot of things right when it comes to technology like Baidu, Alibaba, Tencent, the big companies and others. And I always felt that Europe in between, we lost it a little bit.

00:14:34:10 - 00:14:48:14

Christian Soschner

So when you look at our landscape, we don't have to speak entities. What's your opinion on that? Why why did we see this evolution here in Europe or do I just miss some parts of the picture?

00:14:48:16 - 00:15:09:12

David Dana

I would say again, it's a number of things that is that the first one that until the creation of the European Union, it was very much about getting and supporting national champions, which even if it were the case for the largest European economies like France, Germany or in the UK, the thing which was still new even before you.

00:15:09:14 - 00:15:37:12

David Dana

It was it was good, but definitely not enough to become a global target. So it started with the emergence of the EU where you had to the basis of customer of several hundred million people, meaning that from day one you were able to allow that you're capable of seem to improve because you will not be investing in the future French, Italian or Spanish children, but in the next global leader.

00:15:37:14 - 00:16:00:05

David Dana

And this is the things that we are aiming at supporting, not that it's an exclusive focus, but we are convinced that we have nothing to be say of in terms of technology in Europe. What we mean is in the capacity to translate research and innovation to market and then also to expand and grow because it's something we can come back to that a bit later as well.

00:16:00:07 - 00:16:06:17

David Dana

In terms of sources of funding, there's a difference here. Like in Europe in terms of growth capitalism.

00:16:07:01 - 00:16:30:16

David Dana

This is something that I felt in 2010 11. So right after the economic crash in 2008 and at first I thought I am incapable of raising funds for companies and learn slowly, step by step, that we have a huge gap here in Europe compared to the United States. When it comes to private funding. How do you see the situation of private funding here in Europe?

00:16:31:20 - 00:16:39:01

Christian Soschner

I would make a distinction between now and up to 18 months ago, up to 18 months ago, it

00:16:39:01 - 00:16:57:06

David Dana

was continuously improving. You know, we have had a number, a large number of successful companies which generated already quite a high level of profits and returns, even though many of them will still unrealized. But that was a very good sign.

00:16:57:06 - 00:17:19:21

David Dana

And the trend to go every year, year after year, it was just increasing for the last 18 months. It's become definitely more difficult because of the economic context on a global basis. So it's not like if it was only from Europe. It's the case for all the economies in the world. So my hope is that this situation will not last too long.

00:17:19:23 - 00:17:38:23

David Dana

At the same time, you have a lot of people are saying that it's in the context of downturn in the economy, that you find the best opportunities to exist as well. So maybe that was a kind of inflation before that. On the prices index remains far below what you had in the U.S. or in that you which I most tends to be consistent in the world.

00:17:39:00 - 00:18:05:09

David Dana

But see that it had grown maybe a bit too much to some extent. So now we are coming back to more reasonable valuations, but we are lacking as of the appetite from a number of quite a number of private investors. You know, typically alternative investments are the most risky assets within this. You have private equity and within private equity you have these, which is the risk, just that that's a conflict.

00:18:05:11 - 00:18:35:13

David Dana

So if the biggest financial institution or asset manager, as I like to cut you, is it's tough to see, which is a pity, but it is what it is for everyone. No, that's in this market. So this is very much deepening of the economic cycle and this is why you're so entities like all the public investors here independently of the economic cycles, because we are not only here to support everyone when things go well, while everyone knows that once we select, but when things go, let's welcome back.

00:18:35:18 - 00:18:45:18

David Dana

You know, we also have to to support them into the ecosystem to not to struggle and to continue evolving, to survive and continue from the buildings.

00:18:46:11 - 00:19:04:16

David Dana

Now, you're talking about 18 months ago and now I'm I mean, everybody's writing now about the recession and that we will have a lack of funding in the coming years. How do you perceive the reality on the venture markets at this point in time?

00:19:05:02 - 00:19:40:07

David Dana

I would say there is a difference to make between the fact that first of all, we have quite a number of since which have, you know, powder to is quite big funds in 2020, 2021. And some of them of just started investing more. So they still have a quarter of the funds are very careful in what it then you also have a big number of companies of European companies raised very grants and that still have quite some cash in the bank accounts in the we are one indicator I have, but it's a pattern of what who puts it.

00:19:40:07 - 00:20:07:06

David Dana

There's a number of emails you received every week about the biggest financing round in the these geographies sector or whatever. Until the beginning of 2021. We used to receive maybe four or five of them every week. Now it maybe one or two months. So we definitely have explored an investment path and there's a raise of capital, especially for bigger runs, but the best companies continue to raise.

00:20:07:08 - 00:20:28:14

David Dana

It's maybe a bit more challenging, but they continue. What we see as well is that the ones which walk okay, okay, but not better than that of the Fintech's probably. So it's there's a lot of concentration on the market or entities just disappearing because at the end it will not that exceptional. And let's say that this is something great, but this is also the way this market work.

00:20:28:14 - 00:20:37:17

David Dana

You know, until capital is made serious ends of the success is supposed to generate strong enough profits to compensate for that.

00:20:37:22 - 00:20:56:14

David Dana

They have a needs. This fails, I think, to come to the successes. But I'm curious to learn from you is how do you see the difference in accessibility of venture capital at this point in time between Europe and the United States? You always perceived the United States as being far ahead when it comes to the availability of funding compared to Europe.

00:20:56:16 - 00:21:12:15

David Dana

And very often when I develop companies, I mean, the logical step is at some point in time serious, be seriously serious due to take a step over the Atlantic and approached US based investors. How do you see this differentiates you?

00:21:12:17 - 00:21:12:19

Christian Soschner

I

00:21:12:19 - 00:21:23:10

Christian Soschner

would say as long as we will not have an exit market working well in Europe, it will remain the case, meaning that 85% of the exits are taking place

00:21:23:10 - 00:21:27:18

David Dana

in the US. It should be through IPO. Almost all of the 80.

00:21:27:18 - 00:21:30:07

Christian Soschner

Five 85%.

00:21:30:09 - 00:21:58:22

David Dana

In my view. I don't have the precise figures, but it doesn't really matter if you know either because those companies that were acquired by US corporates, corporations or our IPO in the US. But you have very few entities in Europe with a strong appetite for its condition, even though some of them of money, you know, they have cash, a living account, but they're always risk adverse and don't see into the venue.

00:21:58:24 - 00:22:33:03

David Dana

I think it's worth to see the dollar value, the potential synergies coming from that kind of acquisition of START ups or bigger companies. And that's something that we see definitely we we as a European institution of launched an initiative also to help those companies remain in Europe and a bit longer. Hopefully it was at the beginning of 2023, you may have heard about this, a European tech champion initiative, which is a big full of funds, more than €3.5 billion dedicated to invest large tickets in funds.

00:22:33:05 - 00:23:11:07

David Dana

Texas European Defense, investing in the late stage of growth stage companies. But these funds have to have the size of €1 billion at least. And the purpose of that is that once you have that kind of size, you become a real international player and you appear beyond the international landscapes by holding investment bankers and everyone, meaning that it's not like, no, when you have this landscape where you have 1 to 3 maximum European four years, the proposal is for the next three or four years to have at least 10 to 12 of the players active in Europe.

00:23:11:14 - 00:23:43:02

David Dana

I mean, this would be a great thing because I think we lose a lot of value when the companies are basically forced into relocating to a on the left. But look at the map on the left, the global map, the leftist United States to the southeast, UAE. And then we have Southeast Asia that basically large entities exist. And the question that I have and I don't find it I haven't found an answer yet is how can we motivate private and peace at a large scale to invest in venture funds?

00:23:43:02 - 00:23:50:15

David Dana

You mentioned a fund needs 1 billion to be matched with the 3.5 billion program. But how would they get it in Europe?

00:23:50:22 - 00:24:17:21

David Dana

Yeah, that's a good question because indeed we've seen a lot. Actually what they've seen over the years is that the LP base, the typical LP basis of European and that's changed historically because a lot of insurance companies, financial institutions, we see more and more corporates, investors, family offices, even some high net worth individuals signing smaller checks, but making it really interesting.

00:24:17:23 - 00:24:45:00

David Dana

What we are still missing in Europe is those huge pension funds capable of allocating 5 billion to European risk for the for the next coming years. We don't have that, though. We have to actually balance the fact of attracting non-European and peace with the fact that we don't want them either to have too much of excuse because, again, as you know, the world is it's it's a global market.

00:24:45:00 - 00:25:11:22

David Dana

There's a lot of competition. And again, as a European situation, we are hoping for Europe to remain more independent and sovereign. So it's always a tricky balance to find. We do our best to someone, something that's we do our best. But sometimes it's difficult because you have a kind of unfair competition from some sovereign wealth funds that come in with a tens of billions of things like that.

00:25:11:22 - 00:25:37:15

David Dana

But we try to do what we can with those political support as well to keep those companies European longer and a trigger. So we've noticed that it's it has to be systematic. Then 15 years ago, it's it's less true now when you have a, for instance, a Europe, an American investor coming in, sending it in the big tech, they are not systematically asking for a relocation, nothing anymore.

00:25:37:17 - 00:25:58:07

David Dana

The asking for sure is a company hasn't done it yet, which is not that common either. To open a branch and have a strong local presence in the U.S. But this is something that we see positively to the extent that the company remain registered in Europe with its main operations, it's made, you know, the majority of the headcount in Europe.

00:25:58:09 - 00:26:06:05

David Dana

But we will never prevent the company to expand on an international basis. Otherwise we will never be able to compete with us. So for whom?

00:26:06:21 - 00:26:29:12

David Dana

And I think global cooperation is a good thing if it makes the last 20 years possible. We I think technological wise, we made a big leap forward. And as long as we can keep peace and global collaboration in life, I think that this tech trajectory should continue. But there is still in Europe this one thing that I would like to explore a little bit more.

00:26:29:14 - 00:26:50:04

David Dana

You mentioned sovereign wealth funds, pension funds, also foundations here in Europe. When I look at the U.S., they always have the feeling it's a no brainer for them to invest in venture funds. Whenever I have a chance to talk with Europeans, I experienced the opposite. So that's they're very still very skeptical, still very reluctant.

00:26:50:10 - 00:27:19:10

David Dana

Yeah, I think it's mainly a question of mentality, meaning that European investors want to invest in something where they know that would make return. And the question would be what kind of returns? Where has the inherent risk associated to be seen, which is a risk not to get your capital back if it was to lose everything? And this is something which mentally I would say is not accepted yet by European investors that are to should profit making it a healthy.

00:27:19:13 - 00:27:20:15

David Dana

But

00:27:20:15 - 00:27:23:00

David Dana

if you don't take the risk, you will not get the rewards.

00:27:23:00 - 00:27:39:13

David Dana

And that's something which is indeed I see a big difference in the mentality because because I think that European investors, where usually when they invest in decision, they will not invest in 1520 says they would invest in 1 to 3 maximum.

00:27:39:13 - 00:27:41:19

David Dana

And then for sure the risk is higher.

00:27:41:19 - 00:28:05:14

David Dana

If one of these investments fail, for sure it would be much more difficult to generate higher returns, whereas if they took a bit more issue, construct a portfolio which will theoretically speaking, make maybe slightly lower returns, but with a much, much lower risk, it should be a bit healthy. And that's something which has been done in the US for decades.

00:28:05:16 - 00:28:43:18

David Dana

Investors in Europe started doing that. It has been stopped quite brutally, I would say, for statements, to be frank, and we see especially some geographies in Europe cohesive and more difficult than what it used to be. Them thinking about some of Southern Europe to a certain extent as well. It's very difficult and complex for them to raise returns and a look at them talking about systematic talking even about some more established figures for the huge difficulties combining the global recession with the fact that it up to the extent many of them had relationships or links with Russia, which is just a no go for everyone now.

00:28:43:20 - 00:29:16:00

David Dana

So combining those two elements, it's definitely becoming super difficult to raise money and especially when on top of yes, in many countries in Europe, you have also what we call international promotional institutions, the likes of BPI and friends cable between Germany and Italy. So those are public investment banks, investment branches, making significant efforts to support the local ecosystem by investing into a mutual funds and also sometimes non local funds, but committing to invest.

00:29:16:02 - 00:29:42:04

David Dana

And when you don't have that kind of support and again, when we receive an investment proposal, we have been benchmarking all the proposals against each others. So we make decisions. We are a bit in the dictionary situation, no of saying no to good quality proposals as well, which was not the case 1015 years ago. Now we are talking in this position of saying no to things which maybe ten years ago would have been by.

00:29:42:06 - 00:30:06:23

David Dana

And we know that when we say no to to some extent in some geographies where you don't have a strong local public support, it means that it will not protect us. And that's why also we take time when we make a decision because we know so the impact it will have on the local market possibly, but more importantly in the substance with the people promoting those initiatives.

00:30:07:10 - 00:30:29:06

David Dana

Always this. I mean, this is I had two topics. So one is localization, local support, and the other one is public cooperation, risk appetite. Let's start with localization. Is this a good thing for for deep tech? Because they always experience deep their technology as being a global market and then yes, initiatives are this is helpful.

00:30:30:06 - 00:30:41:10

David Dana

No, but I would say no. But there is a big bet I have that as of today. Still, empty bases are very much in the shallow

00:30:41:10 - 00:30:45:17

Christian Soschner

putting this idea. Yes, it's very much natural.

00:30:45:17 - 00:31:01:02

David Dana

about in France you will have many French investor, not only but many Germany is slightly different where it's a bit more intellectual, but in all the other countries across Europe, across EU, it will be mainly local investors.

00:31:01:05 - 00:31:21:06

David Dana

That's why I'm saying this, that the fact that when you don't have a strong local support, it's even more difficult when it comes to the tech for sure. We need we need the companies to have a global reach and global support. And they want, you know, we have protected what have been the space fields in space. You cannot be just local.

00:31:21:08 - 00:31:52:24

David Dana

It doesn't make sense. It makes sense. In the developed world. We are very much supporting the emergence of new sense. But I'm sure look at the Europeans, because we are lucky with capacity in Europe, but they need an interaction and regular and constant interaction with the other players across the world. Otherwise it would be very difficult to know what is what is last most of today's technology developments and to be able to compete in the noble for mentality solution.

00:31:53:10 - 00:32:09:15

David Dana

And we change that in any way. Does this mean it would mean a cultural shift basically to break open this national thinking and start thinking more in a European way to have to move the companies faster, faster, forward, forward, faster.

00:32:09:17 - 00:32:11:00

Christian Soschner

Yes, I think

00:32:11:00 - 00:32:59:11

David Dana

is changing and one element which it that sense of opportunity even the one create where Europe realized that we had too little and too limited capacity on ourselves to offer a strong support to train and to be able to adapt to what happened. So there is a lot of effort put on supporting specific segments of the market, specific sectors of that's from everybody, not only to help Europe coming back to the position where we should evaluate who we, we would have needed to be at a position forever which would not have been tending that there was maybe a feeling which was not adapted to the reality of the market.

00:32:59:11 - 00:33:27:18

David Dana

But no, it's changing. It's sending a lot. There's a lot of initiatives. I'm sure you other support is a native of, for instance, which is many European. So there are initiatives and programs set up to support this market rather than a lack of support. But again, it will take time. And you know as well as me that especially when it comes to detect the timeframe is is a longer than for a typical digital companies.

00:33:28:05 - 00:34:00:22

David Dana

That that's true. That's true. 10 to 15 years, it would say it's a minimum. And this also is sometimes hindering with the second part that you mentioned, the risk appetite of European large entities. I mean, you don't get the return in six, six months or 12 months, but for those entities you can think in decades 77 mostly or larger corporations, I think there is a good return opportunity to how can be motivates them to move faster to what's the direction.

00:34:01:03 - 00:34:34:24

David Dana

I think it's coming back to the question of mindset and education. If you are talking to an investor or will be taking the valuation of its investments every three months, it's an even more obvious, you know, we have to make sure that they understand that when we invest in a fund, the typical markets and then the lifetime of the fund, it's a theoretical approach, meaning that in most cases it will be extended and even more in the context of the business.

00:34:35:01 - 00:34:48:08

David Dana

But the main difference and that's something that we have to realize and it will only go and be visible through positive and successful examples if that's the potential is huge.

00:34:48:08 - 00:34:58:05

David Dana

You know, one of the sectors where we are as a sector, as we are following is the quantum technologies. We are at the very beginning of something which is a capacity to be huge, but it will take time.

00:34:58:08 - 00:35:22:14

David Dana

But if it works, when you take it, we will. The impact would be on every, you know, on the daily life everyone in the world that we think that. But if you're from there once you've got things change, then you are capable of generating the higher returns. So that's always a question of measuring the appetite and the capacity to wait.

00:35:22:16 - 00:35:37:22

David Dana

And if those entities understand that it's a long term business, it's a strategic investments on top of infinite choices, we have to think about strategic investments. Then there's a chance that we can solve. The issue was always a I'm not that optimistic.

00:35:39:07 - 00:36:18:03

David Dana

Yeah, and diversification. I think this is something that took a long time for me to understand that when you bet on one company or on one venture fund team, then the risk of losing everything is very high and there was ification. Doesn't mean that you can use the upside. It's just means that you catch the downside risk. And I can imagine that some European entities and smaller entities charge their success in venture investments by the first investment and say, okay, if that works, then I continue.

00:36:18:03 - 00:36:26:10

David Dana

If that doesn't work, I stop investing. It's just something that you also see on the market always. It's.

00:36:26:10 - 00:36:41:21

David Dana

I think, something which is interesting to see to coming back to this a question as a time frame of an investment some 20, 25 years ago, there were quite a lot of investment in semiconductor hardware.

00:36:41:23 - 00:37:06:21

David Dana

There are been some huge successes but limited in number. So what's happened is that a lot of investors run away from investing in this field. Now we see more and more people are contacting us, protecting me with a real strategy. So some of them being exquisitely focused on, for instance, semiconductor, which is not something that I would have been expecting even five years ago, but twice.

00:37:06:21 - 00:37:29:23

David Dana

So because they're realizing and we are all realizing that we are too much dependent on other countries, other continents when it comes to delivery and the procurement of anything, all the things are everything we need for the composite and the components to to to make even a simple phone or laptop computer or whatever. We are looking at this.

00:37:29:24 - 00:37:57:01

David Dana

We cannot do as we want. We are depending on the willingness of China, US or other countries to provide us with what we need. And it cannot be. It can be not anymore. And that's why we need to make sure that first of all, we have the technological capacity and technical capacity to develop new technologies and new products, but also the capacity and this is something which is not yet addressed properly in the market.

00:37:57:01 - 00:38:30:01

David Dana

For me, the production capacity and this is something which can have a huge impact if we are able to be autonomous when a European company needs another quantity of components to build its new trinity, a quantum computer, a new mobile phone and this kind of what they were, if we have the autonomy and the competence to choose amongst European providers, we will not be depending on quotas or on who would be the preferred partner for strategic or geopolitical reasons.

00:38:30:03 - 00:38:35:00

David Dana

We will have more power or so to other.

00:38:35:02 - 00:38:49:06

Christian Soschner

But it also, I think semiconductors also means that we need to have very, very long bref. I mean, this is something that we won't see results next year. So we will see, I think it will two or three, four decades.

00:38:49:08 - 00:39:29:00

David Dana

It's it's long term. And that's a signal that again, so point coming back again to this education, these investors understand that it's both actually liquidity, it's both financial and security. And if we manage to align that to the extent possible, again, to maybe it could be over a longer bill of time. But if we manage to show that after 15, 20 years, which so I admit that it's long, but if we have entities capable of waiting so long, then the results after this initial period of time would be much quicker and much, much bigger.

00:39:29:02 - 00:39:56:10

David Dana

But that's something, again, coming to the question of mentality of the kitchen and it starts very, very early in the process of financing, you know, something that we really extended before today when it comes, for instance, to a technology transfer, this is something which is definitely lacking. A lot of strong, high quality videos. We have a number of them, but we should be able to do much more, much, much more.

00:39:56:10 - 00:39:58:22

David Dana

We have huge capacities. I think we

00:39:58:22 - 00:40:04:00

Christian Soschner

have a larger number of engineers in Europe than us and Canada combined.

00:40:04:02 - 00:40:05:14

David Dana

Really.

00:40:05:16 - 00:40:07:09

Christian Soschner

That's what I told him in the report a couple

00:40:07:09 - 00:40:18:01

David Dana

about four months ago. So we shouldn't be say we have the capacity, we have the knowledge, we have the brain to innovate and to to innovate and to to change the world.

00:40:18:03 - 00:40:43:03

David Dana

Then what we need is capital to support the entities, to support them, offering them the access to the customer, helping them marketing the product. Because we have, I think, most of those engineers, unfortunately are a bit lacking the marketing capacity it so we see some of them as a company grouping, that kind of thing, hiring people from the US, for instance, to market the products with phone.

00:40:43:05 - 00:41:08:10

David Dana

But it would be even better with European people doing that. It's a question of again, first of all mentality. For instance, with the universities where you have a lot of research being originated, sometimes it's very hard for them to accept to open to open the shareholding of the companies. And so to create or to give autonomy to investment teams that we could help setting up to run a tech transfer type of.

00:41:08:12 - 00:41:29:18

David Dana

What I like contributing them when we discuss together is it's a it's much better to get than 40% of something was hundreds of millions but 100% of music then they start to understand to realize that indeed there should be more open that should that it's that because it has been developed internally that it belongs to them only and they have to open it to the market.

00:41:29:24 - 00:41:59:14

David Dana

But this is something taking time. Again, it's a question of education, of the assistance as well, because you presume is that once it's in the attention, which if you continuously continue saying that sense extending the same mechanisms and showing, again, you know, it's no big surprise we are supported by its successes, this is how we can promote the markets and the European market successes show that it's visible and know.

00:41:59:14 - 00:42:29:09

David Dana

And again, I think something which is also very important in Europe, that innovation can come from anywhere in Europe. You know, one of the latest biggest successes, you are a bus company. It's originated in Romania. It think most people know there's a company in the US know where existed. If you ask them where it originated, I'm convinced that 80% of them think it's an American company, whereas it originated out of Romania.

00:42:29:11 - 00:42:35:01

Christian Soschner

But is sitting here. So the way above

00:42:35:01 - 00:42:58:14

David Dana

I read out Franz Kafka. What's reports and sort of description of the company and thought, okay, it's a US based company. And it came as a surprise. Now that it's basically it comes from Romania. This is, I think, a very interesting dynamic because I, I reside in Austria. So if you're in Vienna many Romanian people are in Vienna and Romania is not far away from Austria.

00:42:58:19 - 00:43:08:03

David Dana

Yep. And the first information I got from the company was via the United States. How, how, how is it wasted.

00:43:08:13 - 00:43:34:04

David Dana

From day one, this company had a huge advantage and USB and what they did was made the adapted quicker by US customers than European was not a global companies as group. You know what we're out the basic customers and so very quickly they had to to move to the US and this is something that we would have again, we do not prevent that.

00:43:34:04 - 00:43:55:10

David Dana

We don't want to that at all if you need to. But we would have loved to see this company remaining European longer or hopefully and to this is the IPO and ideally later in the year in the European market. But it wouldn't have worked. Whereas now this company was extremely successful with a huge IPO that is still quite well valued.

00:43:55:12 - 00:44:20:20

David Dana

We we to be three through three reasons which for me this tells me this company. So they made a lot of profits which is great you know and we are always saying to the chips we are happy if you become rich it would mean that the companies are successful and will attract attention to the European capacity to. So that kind of of successes.

00:44:20:22 - 00:44:30:19

Christian Soschner

And I mean, the capital flows back into the Europe our European ecosystem anyways. So when make money it's basically a good thing as long as they reinvest the capital.

00:44:30:21 - 00:44:58:22

David Dana

In something that people sometimes are struggling to see, that that's competitive. And so it has are located from seeking within the US. Seems there's a lot of employees in Europe and that gets your salaries. They're making it for some of them starting now, thanks to the success of the companies starting their own initiative, supporting the local entrepreneurs. So it's a kind of, you know, cycle which we like to promote as well.

00:44:58:23 - 00:45:16:14

David Dana

You know, like there was a back in the time of this kind of as much as we got it with all the employees of Skype and some days of Skype, I think the loans are on the things which was not what started with Nicolas from a technical because it's so it's this a kind of things we can promote.

00:45:16:14 - 00:45:28:17

David Dana

No, we are starting having that kind of of successes which hopefully will help attracting so the capital back to the ecosystem and it would be giving back to the ecosystem.

00:45:29:04 - 00:45:57:16

David Dana

This is one of the worries that I have. And I look at the technology landscape. Europe, I think what works really well here in Europe is the early stage funding, especially the research oriented funding with Horizon programs. The European framework programs. If you have a history of over three decades and have fostered broadcast innovation, as you mentioned already, and then we have this big problem of tech transfer, maybe we can dive before we continue this.

00:45:57:18 - 00:46:22:17

David Dana

We've got a part of the ecosystem a little bit deeper into that, but I saw on the market was up to 90% equity claims from tech transfer offices, some royalties and a lot of control intention and three months ago I had the conversation with Ashok Kumar from Sony Institute and he introduced a sound model with 2% royalties non-exclusive for the company.

00:46:22:17 - 00:46:32:17

David Dana

And he said We need to move the technology very fast into a startup to help them find product market fit and then negotiate out of terms. How do you see this tech transfer phase in Europe?

00:46:33:06 - 00:46:59:15

David Dana

Again, what I said, the question of education and mentality. India, for the time being, there's a big sentiment that when you develop something internally digital, see, whereas if you open it to older shareholders, customers to a private market, then you'll be able to value it more and to help the ecosystem more. And you know, that's also something that so European Commission, for instance, realized.

00:46:59:17 - 00:47:38:03

David Dana

I'm sure you are familiar with the ICC, so your opinion of IT innovation policy, which has been set up a number of years ago with the Accidental Talk, which is an entity providing equity investments into very early stage deep tech companies directly. Business go contrary to your. Yes, well, in this sense, they do direct investments. There have been some organizational issues at the beginning which have delayed the disbursement, but now it works well and you have a lot of companies getting sort of true support, starting with a couple offer to have an android, but up to 15, 20 million.

00:47:38:03 - 00:48:04:05

David Dana

So it can be quite messy That and the left hand tender for the companies so there's a lot of willingness to have interest too. But then again public institutions cannot do everything. And that's why asking for this support from private investors, we would be committing to the whys, you know, and it's going to be something good idea for the market to rely exclusively on public sector

00:48:04:23 - 00:48:32:21

David Dana

Otherwise we end up in in a very interesting economic system when the public sector invests everything and the private sector doesn't invest. I think this works well up to early stage investing up to serious say here in Europe. And then my concern is that when companies relocate or when they need investors from the United States or somewhere else in the world, very often the entities in their regions that investors reside grow faster than here in Europe.

00:48:33:02 - 00:48:39:23

David Dana

So how can we make sure that then capital also flows back to Europe so that we can evolve our ecosystem further?

00:48:40:00 - 00:49:03:23

David Dana

So one, as I said, is the fact that quite the number of the headcounts remain in Europe and usually it's more of a technical part which remain in Europe more than the marketing one, meaning that these are very capable people who have been there, have been there since day one. Usually because of them, the product or a company.

00:49:04:00 - 00:49:37:21

David Dana

So they get quite decent return out of it and a lot of them are very much keen on the, you know, giving back to the to the community. And so those are doing investments in like business themselves, but also a number of them are setting up their own firms and this is something we see more and more people who have been successful, even not as entrepreneurs, but rather for the employers of the, I would say not yet numerous, but few have European success, successful companies.

00:49:37:23 - 00:50:02:07

David Dana

And this is something which is definitely changing, changing the whole the whole thing. Because if you have people with the technical capacity and some financial means to help, you will have a new population of companies that would be much, much stronger. And then from there, so once that's going to emerge will be even stronger and have opportunities to become a global leader.

00:50:02:09 - 00:50:11:24

David Dana

So it's a it's a kind of cycle. You know, you need people who have gone through the fruits of food cycle to come back to the very beginning.

00:50:12:02 - 00:50:28:24

David Dana

I think anthropologists usually do that. I'm and let me just think, I think I've never experienced an entrepreneur who had a big exit to simply retire and enjoy life. They always after 12 months, they come back later and found the next company.

00:50:28:24 - 00:50:32:01

Christian Soschner

And you know something interesting as well, that

00:50:32:01 - 00:50:56:23

David Dana

what we see that those investors who have been backing those companies and who have a strong network in Europe, they have a tendency to prefer not being number X, Y, Z in a UCC field, but to London online in Europe. And that's also something which has to change. Actually, I saw that for the very first time, maybe ten years ago.

00:50:56:23 - 00:51:21:13

David Dana

It was important. When we started investing there, I was with a colleague and we had a very strong team made of Polish guys all, of them coming back home. I would say after successful experiences mainly in the US. And so this is something which is happening. But again, it takes time because even those great initiatives will take years to come, to come to the end.

00:51:21:13 - 00:51:40:24

David Dana

And knowing the actual financial reasons, which is what you do, and to convince private investors again, it's always the same rhetoric. You know, you have to make sure that you can grant higher returns to the investors so that they can in good conscience, I would say allocate capital to this.

00:51:41:02 - 00:51:53:13

David Dana

Yeah, higher returns. I think this is something that we need to remind people more often that ultimately investing and entrepreneurship is a lot about returns, creating returns. It's sometimes forgotten.

00:51:54:03 - 00:52:20:04

David Dana

Yes. Yes, definitely. Because again, we are early stage to that, to my team and to the firms because we meet. Investing is great and I don't think it's easy. But what's even trickier is making exits, especially in the markets, which are and that's maybe the major and only limitation they have until just the current downturn in the economy.

00:52:20:06 - 00:52:42:11

David Dana

The that on paper we have great great successes but too little liquidity it is too little cash back to help because at the end, cash is key. So as long as you don't get the cash, okay, you are in very strong IRR GDP. Yeah, but what what is important is that people how much do you sent back to the investors?

00:52:42:13 - 00:52:49:09

David Dana

Because this is how the people will be convinced or they will convince the management and how they would get additional allocation to that.

00:52:49:14 - 00:53:09:15

David Dana

It is, but I think it's a it's a red line that I see in startups, in scale ups and also in venture funds that whenever I tackle the topic of how do you create returns, people often look at sometimes look at me and say, why, what? What you mean? I say, Yeah, well, I mean, this is the purpose of the company.

00:53:09:15 - 00:53:16:08

David Dana

You need to create return at the end of the day and returns that are higher than 10 to 20% per year. How do you do that?

00:53:16:24 - 00:53:46:11

David Dana

It's very difficult because I see sometimes you. It's a question of alignment of interests and what you need to make sure when you start investing in a company, especially issuing vis a vis firms alongside other ones, make sure that you align on the objective in terms of time, in terms of financial objects. It goes well because. It shouldn't sometimes for one of the investors, when there's an offer on the table, it could be grateful to the ones to be to look.

00:53:46:13 - 00:54:12:08

David Dana

And then what do you do? What is line? It doesn't mean that you have to do everything all together or caring for the wise you not because I believe in the discussion and contradictory views to or to improve, but if you don't align beforehand it would be very difficult for either one or so something which we see is a misalignment with the funders.

00:54:12:10 - 00:54:21:10

David Dana

Just you have to be very clear as they have to be clear on what to expect and you have to be very clear on what you can through. This is something which is tricky. Yeah.

00:54:21:12 - 00:54:44:07

Christian Soschner

This is so important. This is so important that you mentioned that this alignment of interests, I think this is essential for any company success as a sentiment. When Bond Fund invests and says we need our money back in two years, the next one in five years, and the founder thinks he's building a company that lasts like Apple. You have a misalignment and people don't address this misalignment before they invest.

00:54:44:12 - 00:54:45:12

Christian Soschner

It's a whole mess after.

00:54:45:13 - 00:55:21:09

David Dana

That because, you know, it's exactly the same for us as an MP. When we invest in a fund we may like, and I hope we do, we like the strategy with the team, but we also to get to an alignment of interests. Otherwise you have to make sure that the people are rightly incentivized that they will be living in a sufficiently good manner to not to have a kind of day to day financial pressure on their life, but to become rich if they make huge returns for the things meaningful to investors, meaning for the private investors, because this is critical.

00:55:21:10 - 00:55:24:03

David Dana

This is a business model of this.

00:55:24:23 - 00:55:33:21

David Dana

How to how do you manage that with before your entity? How to you create this alignment of interests? What is your secret sauce?

00:55:34:09 - 00:55:52:16

David Dana

There are a number of elements that we look at. The first one is about the terms and conditions, meaning what is a management fee scheme for the funds? We always have a cap on the fees to make sure that over a lifetime of the funds, if not not more than a certain percentage which will be used for management fees.

00:55:52:18 - 00:56:12:09

David Dana

And that's widely regarded diligence which are going to be quite extensive. We going to take, for instance, a review of the budget of the men that have been opened. We want to know what are the expected costs depending on the fund side, give them the liquidity scheme to make sure that the people again are not under stress on a day to day basis.

00:56:12:09 - 00:56:33:04

David Dana

But we know to become rich by this little. But for sure we are very much happy for them to become rich through carrying interest. So we have to make sure that the alto is reasonable, but at the same time that they have skin in the game, meaning that puts money as part of what we put in to our GP commitments.

00:56:33:06 - 00:57:07:21

David Dana

And this one is sometimes more difficult because we know that might be a difficult points for some of the people, especially when you younger people who have not yet had an opportunity to work due to creating wealth or when there's someone in the team with much bigger means and the other ones. So we always try to find the right level of commitments together that together with a fair split within the team and because for us is the most important as well, is that they work at a team.

00:57:07:23 - 00:57:46:10

David Dana

We have specific clauses for key executives, you know, in defense. Q Sometimes individual ones, sometimes collective ones. Similarly to this is when we visited with Vicinity. I don't say that we don't care about the rest, but the most important thing is if the people are good at what they do, is that capable of providing added value to the company, that is values, that is quantifiable and that makes a difference is they have a capacity because they have a strong experience, expertise, networks, whatever the reason to access the best deals fully into their investment strategy.

00:57:46:15 - 00:58:07:20

David Dana

Also elements very important for us since that's one a big part of what intelligence is to referencing the people we may be working with and so is something I already said in a couple of occasions, but usually we ask for a list of people that we can call, and that's precisely the people we don't know when.

00:58:07:24 - 00:58:24:05

Christian Soschner

And just assume that the new funds, the first time team comes together and says, okay, we want to create a venture fund and approaches you, both of you recommend which information should they have prepared to wants to talk with you.

00:58:24:07 - 00:58:49:23

David Dana

So first of all, some people sometimes don't realize, but we we spend a lot of time to talk to and discuss with a lot of people who want to raise visitors. And even so, even in many cases before they formally submit any proposal to because first of all, we want to avoid that to set up from a sometimes just a legal standpoint, things that would not be visible should we have an interest and we give a lot of recommendation.

00:58:49:23 - 00:59:15:23

David Dana

But then the most important thing is that we are not saying I can get new teams, but you know, having invested in more than 600 firms, we will not just buy a new one. So just for the purpose of picking a new one, we'll pick a new one if they bring something different, If they have a US visit to see it in a different way, if they are focusing on specific semantics, which is not really covered in the current environment.

00:59:16:00 - 00:59:37:15

David Dana

So we need to find this. Who is and then know what you what you want to do and be convinced in order to convince us. Be convinced that you will be successful in what you do because you have a different approach, you have a different mindset, have a different way of doing things. You have a different operational background.

00:59:37:17 - 00:59:55:22

David Dana

Make sure that you show us and you convince us that you will get access to those bits of that we were referring to. Because otherwise, why we be looking at it if you just do it to sell, to put a team in place, it should be competing against all the other ones that we. But it wouldn't make sense.

00:59:55:24 - 01:00:00:15

Christian Soschner

Yeah, you need the ecosystem or at least access to the ecosystem to get access to the deals, to.

01:00:00:15 - 01:00:29:07

David Dana

The ecosystem, to the customers, to the investors from interstate, from you need to be to some extent as well capable of challenging the entrepreneurs from a political standpoint. So those are lots of ways to to be a difference. Make sure that you find one which is really in your DNA, not something artificial and don't try. It was the most important thing I would say is don't try to change what you want to do to produce.

01:00:29:09 - 01:00:33:21

David Dana

It's rather convince us that what you do is worth getting. Some examples.

01:00:34:00 - 01:01:04:14

David Dana

I would like to explore this term up a little bit deeper. You mentioned semiconductors before and I happened to have bought shares in NVIDIA 2014, so it's a way back and back then. The difficult thing was that really nobody wanted to touch semiconductors, nobody wanted to touch chip industry. And every time when a product is topic, I got a hard push back and people looked at me puzzled and said, I mean, you cannot make any money with chips.

01:01:04:14 - 01:01:28:06

David Dana

It's a commodity. Nobody will pirate. And I think the hard thing also today is to have this contrarian approach, especially for your victims when your funds teams to up to be willing to operate in an area where nobody is looking at because there is the opportunity about how do you handle this? I mean, semiconductors now I know in artificial intelligence, it's hyped, it's sexy, it's attractive.

01:01:28:06 - 01:01:42:02

David Dana

And when people invest and buy now, I see the downturn in 2 to 3 years latest and they will partner of capital. How to you handle this contrarian and type approaches and in regards to us proven funds approach you.

01:01:42:05 - 01:02:05:05

David Dana

I would say US is a generic term, but you have different categories of choice. This is a symmetric asymmetric approach. It's one which it's not dissimilar for sure. We are. We are currently backing some fully specialized semiconductor funds, but we are also backing some more. I would say general is deep tech here with some specific focus on should it be space and the conductor or whatever.

01:02:05:07 - 01:02:31:24

David Dana

And we are also backing a number of regional players, which for a reason or the other of a strong appetite for one party with these deep tech sectors should be because one of the names as a strong acronym in one of them or a specific network or whatever. Now what is really important is you show and to convince us how you would make feature.

01:02:32:01 - 01:02:42:02

David Dana

But I some of that because again, being a Europe institution, many people say, okay, but okay, we are perfectly aligned with your objectives. You just have to invest. It's not how it works,

01:02:42:02 - 01:02:56:01

David Dana

it's investment, it's not deployment. So we are making investment decisions based on the whole analysis. Would we be 100% right? No, it could be. But we hope that it's investment for each of the cases.

01:02:56:01 - 01:03:20:11

David Dana

We will be not too far from what. So we hope that the capacity and skills that we've built internally over the last 25, 30 years to select assets and select and support teams within the teams or more established teams, we will use it in the interests of the market, in the interest of Europe, and again, for the best.

01:03:20:13 - 01:03:49:06

Christian Soschner

Let's talk a little bit about the AEF structure. I think in Europe, especially the early stage companies and investors are a little bit spoiled by grants and I can imagine that some people like me, when they approach you will think first that AEF is nothing different than the grant organization. You spread the money in the European landscape until something returns, but you don't demand returns.

01:03:49:08 - 01:03:58:09

Christian Soschner

What's the structure? Maybe we emphasize this a little bit. What's the structure of the AEF when it comes to returns? You are an investment funds to understand it, right?

01:03:58:11 - 01:04:29:08

David Dana

Indeed. Maybe. Well, just before entering that one point that I still recall when the first two years when they were that yes yes some people together but it's obvious it's far from being true to continue. But why some people have this feeling? Because in many cases, when we say no, the phantom doesn't materialize. So it means that you will nobody in the market will ever know that there was an opportunity.

01:04:29:10 - 01:04:47:21

David Dana

So this is what I have to keep in mind. Then in terms of returns, we always have our rights in the in the sense we we. But should it be a kind of political of the right or are of type of of the right. We systematically F1 that's no exception. This is a market still in the requirement for us.

01:04:47:21 - 01:05:16:12

David Dana

So there is no question of first of all there is a need to generate returns. You won't get access to carried interest. This is a very important point. And then again, being a public investor doesn't mean that we are not regarding and looking at the what we do. For instance, when we have backed fund manager of a one or two generations failure, others.

01:05:16:14 - 01:05:41:15

David Dana

So it's not because you don't do great returns with one sense that we would not back you anymore. But when it becomes a consisted of systematic thing over two or three generations, definitely we will not move back to the sixties alone. We always give it sense, but especially know that it's more and more competitive. And as I was saying, we have the luxury of saying no to good quality proposals.

01:05:41:17 - 01:06:10:17

David Dana

So if we have a the if we think that it's not by design, but more by look, that when they try to be successful or even there is a breach in some commitments that the piece took in terms of geographical location or whatever, we stop to think that if this manager lets it and I think that the main driving element for the people we work with is that we don't finish that if they make a mistake.

01:06:10:23 - 01:06:19:09

David Dana

But if we stop making them, since a signaling effect is strong enough to do the kind of thing we're going to.

01:06:19:11 - 01:06:40:07

Christian Soschner

You you mentioned that you backed a few hundred teams since today, if exists, is it possible to walk the audience through one success story that exemplifies how you stopped interacting with the funds until you close the deal and how you follow up until the fantastic tests?

01:06:40:17 - 01:06:57:10

David Dana

Yeah, I would say without giving them that just in principle how we work. So sure, we were already in contact with the team or not before that formally applies, so they applied to see if we knew to send an investment proposal. Well, that's, you know, and contrary to what some people may think, we don't need a committee tape.

01:06:57:12 - 01:07:25:00

David Dana

We need a kind of 2025 slide document, a PDF type of document of what points we end up with a document. We just need the main elements to be there, which are the investment then team, my team, I mean their operational background, educational background, everything that's been track record. Then we need also elements of the market opportunity in terms of pipeline activity in this field, but also exists.

01:07:25:02 - 01:07:46:02

David Dana

So to make sure that so again, investing is nice, existing is even better. And the last one is again about, about what we call the genetic way of simple remittance, which is made of both kind of theoretical model and the time of conditions. So once we have all of those elements together with the governments and the legal setup, we start the investment analysis.

01:07:46:03 - 01:08:07:00

David Dana

So usually, depending on the specific strategy of the fund, it's allocated to someone in my team or in another team within. Yes. Then from there should count on 4 to 6 weeks of including interaction with the people in charge within the team to discuss and to have approved. I mean, every recommendation that should be discussed with you on the team meetings.

01:08:07:02 - 01:08:32:18

David Dana

Then at that time, if the conclusion is negative, the manager will be formally informed by a letter. But we always ask and push our team members to set up what we call a kind of the update call where we explain what we said. The purpose is to hoped that next time the secretary point would be mitigated enough to potentially reopen eligibility for us.

01:08:32:20 - 01:08:53:07

David Dana

Second step. If we say yes, then does what we call the second screening meeting, which takes place in offices in Luxembourg, or with a kind of two or three or three meeting. When we go through the main aspect of the proposals, including the potential attachment points that may have been identified, trying to already find ways to get of after that.

01:08:53:07 - 01:09:16:15

David Dana

Again, the outcome is discussed during one of these two meetings. If it's a yes, then we move towards the due diligence, which is a one and a half to two days in the offices of the to be spending time on each and every aspect of the proposal. It's quite extensive, quite long, quite detailed. But this is nothing more than a solution, due diligence.

01:09:16:15 - 01:09:50:16

David Dana

So we as part of that individual interviews with the team members and things like that to make sure that we get to know all the details of the proposal because there was a senior that was the DP that told us that he was a deal team with the team in terms of processing of what the church collection is convinced that we have to make the collection that would become advocates, we tell them, because we also have to interact with the internal departments such as the risk management department, compliance, KYC, but also with external entities, the European Commission.

01:09:50:18 - 01:10:00:22

David Dana

So we are the ones, if we are convinced that we want, we have to make a deal that will be defending the case. I would say to us, all the other stakeholder in the investment process.

01:10:01:08 - 01:10:12:06

David Dana

How much what is the maturity demands that you have at this? Do you need a 100% agreement of the stakeholders when you present an opportunity, or is there a maturity?

01:10:12:11 - 01:10:22:09

Christian Soschner

Know there's a thinking that the different steps and we can move to the next one on the approval, which is not systematic and either unanimity, unanimity,

01:10:22:09 - 01:10:37:15

David Dana

but that is maturity, but there is no formal voting, I would say right at the time it's more kind of discussions hit back at requirements requests from specific departments to have something clarified or potentially even sent.

01:10:37:17 - 01:11:12:17

David Dana

Is it something and it takes time and that's why we are so I know sometimes we hear on the heads of signal, we are not sure, but we do what we can. We do as well as we can. Keeping in mind the fact that the three steps I mentioned first, and that is the second screening meeting, due diligence, the steps which are visible for the outside world, whereas internally we have all internal interim documents to put these discussions to, to hold and interactions to to make sure that we have all the elements necessary to defend case.

01:11:12:17 - 01:11:27:09

David Dana

And once this to diligence is done, if the outcome is positive, then we go to a board submission for a recommendation to commit to the summary. And when we get it, it systematically conditioned to the fact that it could reach a total and full agreement. And so I think the documentation.

01:11:28:03 - 01:11:34:00

David Dana

So we are talking basically about a process that lasts 1 to 2 years in principle from.

01:11:34:01 - 01:11:36:17

Christian Soschner

I would say,

01:11:36:17 - 01:11:39:16

David Dana

yeah, 10 to 14 months.

01:11:39:18 - 01:11:42:00

Christian Soschner

Which it's quick, that's, that's quick.

01:11:42:02 - 01:12:04:19

David Dana

It could do us anything. And again, you know, we saw that we were not super quick we said but we again as as quick as we can but hearing feedback from private in it's an offense that we claim for some of them that it's a process of 16 to 1220 months in we it's it's not that long again if we could do it quicker it would be better for everyone.

01:12:04:23 - 01:12:27:19

David Dana

But we just and we do it we again and I think what what what is also important is that we have a duty as well not only to work for stakeholders but to open markets, because we know that there are quite a number of investors who are not, I would say, sophisticated enough, not, you know, with no negative sense of that to do that.

01:12:27:19 - 01:12:56:10

David Dana

But we are designed that dedicated to do that on a daily basis. It's our only work is to select and invest in provision. Some other investors are windows that are put on on an opportunistic basis from time to time. They rely a lot on us. They know that when we sign and the EPA, it means that everything we need to know indeed as well, that the approach in US estate is very much different.

01:12:56:10 - 01:13:09:16

David Dana

It's very much to be friendly, it's more LP friendly in Europe and again being different investing, managing and investing EU public money. We pay extra attention to protecting us as an investor.

01:13:09:18 - 01:13:21:19

Christian Soschner

Yeah, I think this is necessary, but I look at 10 to 14 months. I mean, I always say when someone approaches me for fund raising 1 to 2 years, 12 to 24 months, to expect that just to manage expectations. If it's better, it's better.

01:13:21:21 - 01:13:26:07

David Dana

But yes, for sure. But to say that that's the average. Yeah.

01:13:26:09 - 01:13:32:20

Christian Soschner

Yeah. But when I look at this, Eurostar is in one month closing. I never experienced that.

01:13:32:22 - 01:13:54:01

David Dana

You know, I know some number of services you guys with your friends who send a send an email saying okay guys, this is a new a new friend. You have two days to comment. And then we closed indefinitely. Not something that we would be capable of processing. But again, this is what it is. You know, the European market is different.

01:13:54:03 - 01:14:09:02

David Dana

We know that there's a quality stamp attached to a signature and beyond what we do for or as we call that, because the moment that those the ones providing the money to us, those this duty towards the market to be honest between.

01:14:09:04 - 01:14:35:07

Christian Soschner

Yeah it sounds like a salesy it's comment you have two days to invest and then the opportunity is gone. So it's like selling cars basically. But when you look on the market, on the websites, I have two entities, yes. And also the European Investment Bank. EB And except the last part, it sounds pretty much the same. Can you explain a little bit for the audience for France between the two entities?

01:14:35:09 - 01:15:15:01

David Dana

So actually it's not at all the same. It's the same group. So it's a EIB Group, meaning that it is a model company of. Yes. So it's on a majority shareholder. I think they are holding a bit more than 60% of our capital. But beyond that, in terms of activity, it's very different. The AP was created 75 years ago as the investment arm of the European Union, and from day one it was designed to support large projects, infrastructure type of projects, public private partnerships, you know, as financing the type of building of roads, highways, bridges, hospitals, schools is very much different what is more and more close to what we do.

01:15:15:01 - 01:15:36:24

David Dana

But to differentiate that they have an activity to invest in funds outside of Europe, whereas the IMF is very much focused on EU and they also have two other activities which relates to what we do, one which is venture backed. So they are providing that venture. The two companies, and they have they are the ones managing and advising these.

01:15:37:03 - 01:16:09:22

David Dana

He actually I thought I was mentioned, so they are the ones processing the due diligence his and building the investment case for the investment committee of the A6 Gato, which is again this a direct investment to equity investment to into a very early stage and a very risky take competence. But apart from that, from an operational standpoint, we have our own processes which are very much aligned, but we do our business and we report to IAB for sure.

01:16:09:24 - 01:16:23:22

David Dana

The Chairman The full board is from the EIB. We have some board members. I was working from the Abbey, so we are also both entities located in Luxembourg. So it's very close, but I put it to them in terms of operations.

01:16:24:12 - 01:16:37:22

David Dana

And on both ends you need the private capital to match your investment. So it's not a possibility that the company says, okay, I venture fund says okay. On one hand we A Yes, we found out. I think that for a company.

01:16:37:22 - 01:16:38:16

Christian Soschner

01:16:38:18 - 01:17:10:24

David Dana

It can be combined sometimes, but it's not not an objective, definitive meaning that we don't communicate from one team to the other, who we are working with and who we could then visit to work with. But what we need indeed, is when we listen to sense, that can be more than a certain percentage of public money. So This is something important to note that indeed, depending on the strategies, that might be some exceptions, but a very minimum, usually 30%, three 0% of private investors, if not more.

01:17:10:24 - 01:17:15:13

Christian Soschner

on the in the 30%.

01:17:15:15 - 01:17:23:20

Christian Soschner

Yes, yes. That's sometimes that's a requirement for some specific mandates. Usually it's around 50, but

01:17:23:20 - 01:17:27:10

Christian Soschner

it can start from 30 depending on the strategies.

01:17:27:12 - 01:17:30:06

David Dana

So you can go up to 70%.

01:17:30:09 - 01:17:48:23

Christian Soschner

It not us, meaning not when I say private and means non private, not only should you, we we theoretically speaking, we can go up to 49.9%. We don't like it very much preferred remaining around 2030. We have very few exceptions where

01:17:48:23 - 01:17:59:02

David Dana

we can be even bigger than 50% up to 70. But it's very, very limited cases and much more a developmental type of mandates.

01:17:59:04 - 01:18:06:10

David Dana

But for the mainstream activity, there seem to be different. We have a super for it to remain among 20 25%.

01:18:06:12 - 01:18:15:20

Christian Soschner

So your ideal case would be when a venture team has already 80% committed private capital and you.

01:18:15:22 - 01:18:20:10

David Dana

Know, they don't need to have the 80% ready yet. What we need

01:18:20:10 - 01:18:25:13

Christian Soschner

is to see some traction, some traction, some soft commitments or even better

01:18:25:13 - 01:18:44:13

David Dana

health commitments, because I think that when we sign an investment, it systematically conditional commitment condition to a number of elements such as this matching from private money or as minimum fund size. I mean, these are say something which our commitments will never be effective.

01:18:44:15 - 01:18:48:01

David Dana

So we have a number of elements associated to this.

01:18:48:01 - 01:18:58:18

Christian Soschner

One question that I have in mind to you suggested milestone plan. Then when you invest in a company or to invest everything upfront in to light it.

01:18:58:20 - 01:19:19:06

David Dana

We always send a commitment which would be called overcome. So you will never know my story, but there are some specific templates to fill to be filled by the GP when they ask for a new money to be sent to us over to make sure that it's compliant with a first of all with the mandate, but also with the LPA and with general recognition.

01:19:19:08 - 01:19:31:10

Christian Soschner

Which good to know. When we look at the future of Europe, where do you see what's, what's your vision for Europe on the tech landscape? Where do you see the tech landscape in? Europe in ten years?

01:19:31:23 - 01:19:37:17

Christian Soschner

I wish I knew. I think that

01:19:37:17 - 01:19:55:19

David Dana

if you look at the capacities we have, it would be a shame that to be a but it's one of those huge absurdity. I come to you again in terms of engineers, brains, people thinking about what can be done. What can be changed.

01:19:55:19 - 01:20:03:08

David Dana

You know, there used to be this kind of current thing where people say, yeah, us innovate time that copies and your prejudice.

01:20:03:13 - 01:20:04:24

David Dana

It's not the case anymore. You know,

01:20:04:24 - 01:20:26:15

David Dana

there's some regulation definitely because and I am convinced that in many cases it's them that we are more and more considered as being an innovator, a continent, much more than integers. And that's great. And again, those successes, like we mentioned, Europe and other ones, as you said, sometimes people just don't even know it's a European by origins.

01:20:26:17 - 01:20:37:11

David Dana

We need even more to show that we are not only good at thinking about new and disruptive technologies and business models, but also can implement them and make them concrete successes.

01:20:38:05 - 01:21:03:14

David Dana

Yeah, I'm curious about the dynamics. I mean, what's your opinion on that? I mean, if you have the US, we have the UAE, we have Europe, we have China, do you see generalization every so that every region tries to play in all fields of do you think we are going more towards specialization that per say US specialization area like continuing the digital revolution, Europe going on for example, climate tech and China.

01:21:03:16 - 01:21:05:24

David Dana

How do you see this developed?

01:21:06:06 - 01:21:38:04

David Dana

I hope not. I hope that will not be a specialization approach. It is giving. We have the capabilities to be much bigger than that and to develop much more broader companies than being some kind of siloed approach, which is going to be a good thing because otherwise we would still be dependent on the models for specific reasons. Climate is a big theme now in Europe and it's growing a lot and we have a very strong focus on that.

01:21:38:06 - 01:22:06:20

David Dana

And we're also talking about the tech. Again, a lot of deep tech strategies are very much talking about the quantity, and I'm sure that we are not yet the leading ones, but we have three seem to to it. But we need to make sure again that not only there is a political willingness and political financial support, but also profits.

01:22:06:22 - 01:22:31:24

David Dana

So again, maybe to look like in the from insisting too much on that, but it really makes a difference when you think at the thinking of, again, quantum technologies as an example, you know that China and us have developed huge plans which very big financial means to support those developments. Europe is still lagging behind. We have very good companies, you know, these French plus kind words go from there.

01:22:32:01 - 01:22:50:11

David Dana

And I spoke to Nobel Prize. It means that, you know, it's not like we are doing things, but but we need to make sure that from this McKinsey's and we are not saying because we are French, Italian, German, or whatever, not to be able to compete against the rest of the world.

01:22:50:22 - 01:22:55:24

Christian Soschner

And I think you're more united, you will get a bit different.

01:22:56:01 - 01:23:03:21

David Dana

Yeah, I totally agree that. I mean, Europe must eliminate the borders in Europe and think this European

01:23:03:21 - 01:23:23:22

Christian Soschner

area. And I think the the basic idea of European Union was working together, collaborating and ensuring peace via collaboration in Europe so that we don't see a lot of war happening on the continent again. And to think that I is missing in the next ten years is still this private capital element, as you said.

01:23:23:24 - 01:23:30:22

Christian Soschner

So we need much, much more companies and foundations, pension funds from Europe, investing in Europe.

01:23:30:24 - 01:23:36:04

David Dana

Yes, yes, we get that. What I was repeating.

01:23:36:06 - 01:23:43:17

Christian Soschner

Out that you see the role of the IMF in the next ten years.

01:23:43:19 - 01:24:27:12

David Dana

I think our role is evolving compared to what it was ten, 15 years ago. Then 15 years ago, it was about putting again, the European seed market on helping the players, raising funds, raising bigger firms that we've seen a number of much bigger funds compared to what was the case previously. Now, I would not say that the work is done and we need to move to something else, but we together with other investors, once again, we have helped a lot in that and we will continue, but we will also pay more and more attention to specialized strategies because this is a sense of history and the evolution as well.

01:24:27:14 - 01:25:02:20

David Dana

Should it be about, again, climate take again space and ecological or things where again, Europe is well positioned as a skills but lacks specialized investors? Not that we only need specialized wisdom, and this is something also important to keep in mind. I have a concrete example coming to my mind about the space company, which was initially financed by only specialized space firms, but which decided and managed to attract general players to leave the new roles.

01:25:02:22 - 01:25:39:05

David Dana

Why is that? Because not only to bring another perspective, but also that show that it can be attractive for private investors. I mean, these are two are not only politically active, but also financial perspective. And I'm not sure which else that can be expected. And I think it's really important and will always entrepreneur because it shows that those investors you know what they will get wrong they will not be happy to lose money so they have to make sure that that something was the methods intelligences analysis and tells us to the potential.

01:25:39:15 - 01:25:40:07

Christian Soschner

And.

01:25:40:09 - 01:25:41:06

David Dana

Yeah.

01:25:41:08 - 01:25:58:12

Christian Soschner

I think it was also helping Europe. When we accept that individuals can also have our own they a lot of capital to invest when they are visionary characters like Elon Musk, for example. Jeff Bezos I think is this attitude is not so ingrained in the European DNA.

01:25:58:16 - 01:26:25:07

David Dana

No, no, definitely. But again, looking again at the institutions, I mean, your question about value for our role will be to foster the markets for some specific sectors because first of all, this is what what we are why we are here. And also on top of that, we have dedicated mandates to do so. So we need to make sure now that we find them support the ones which are competing.

01:26:25:09 - 01:26:52:24

Christian Soschner

Yeah, you mentioned space. I mean, it would be fine if your activities help to be the first on Mars and not not Elon Musk. So yeah, just, just, just if, just to find out you you bring a wealth of experience to the table and you have very deep insights into the European landscape and working with a lot of venture funds and to one side on the other side with big corporations and then with politicians in Europe.

01:26:53:01 - 01:27:11:21

Christian Soschner

When it comes to decision making, it's something that young entrepreneurs especially straggled very often or young investors strike about very often. Could you share a story from your experience that helps people to approach decisions?

01:27:11:23 - 01:27:38:04

David Dana

I think what is really important to me is to empower the people, meaning as a manager, you know? So I have a team of ten investment professionals. As a manager, I don't apply in the kind of money, judgment, way or routes that they would not like to be subject to. And starting from there, I give people autonomy a truth.

01:27:38:04 - 01:28:03:06

David Dana

Then I'm not micromanaging, I support them. We have also everything in place within the IGF to support our new donors, to understand what we do, how we do it, which is because, you know, investing into this event is something we're doing. This, I tell you, is something else. So you have to know how to do it. I tried to give responsibility to the people by trusting them.

01:28:03:06 - 01:28:39:17

David Dana

And, you know, when we have our team meeting, when we discuss the proposals, if we have to change the recommendation, it's fine. Doesn't have to be seen as a kind of failure or mistake made by the person in charge. And my role is indeed based on the experience I gained within the year. Yes, but not only my but the other people who are most in Europe to give guidance and sometimes spotting things that you only see because, you know, you have already faced some issues, you know, the people from quarter contacts or whatever.

01:28:39:17 - 01:28:56:19

David Dana

So it's very much about giving them the capacity to make the decision. But if the decision they made is not the best one, they just reconsider. Maybe it would be change, maybe not.

01:28:56:21 - 01:29:18:24

Christian Soschner

How do you handle that within within your team? I mean, when you give people autonomy, nobody's perfect and everybody goes for a learning process, which means people will have to successes but also will make mistakes and experience failure. How do you handle that as a leader in your team?

01:29:19:01 - 01:29:42:04

David Dana

Something which which is very important to me that especially since COVID, where many people started to tell, work it out, I'm still working today. So is to be present in the office first of all, but also and more importantly, I would say, to have regular calls of that coach with each and every individual. And that usually we go through the workload and the other topic.

01:29:42:04 - 01:30:19:07

David Dana

But again, I try to be active on all the ways that just is a regular fixed meeting. But he makes calls, WhatsApp, SMS, signal teams, whatever difference in any question, if anyone has in the beginning because they just don't know what how to process something. I always try to to be reactive to everything because I know that if at my level I'm not effective and I don't have them getting an answer and processing the topic they have to address, then it just slow down the whole thing.

01:30:19:09 - 01:30:53:16

David Dana

And yes, that's something I try to do. I hope I managed to do it in a good way or not too bad. But yeah, that's really my, my, my, my thinking is that I'm not looking especially for people who will be arriving at an agency of state in the evening to be talking to some kit. And I tell everyone in my team that I told them as a starting point, if we have been hiring them a ten years, it means that we are all at the management level convinced that it is a good addition to the team.

01:30:53:18 - 01:31:18:07

David Dana

So we start by trusting them, trusting them, giving them autonomy, and up to the extent that they deliver on what they have to do, it would be for and again, if there's something which does not work in it, but once if you start to be repeating it, then that will have to become more micro that I don't like, but the person will not like it.

01:31:18:09 - 01:31:25:03

David Dana

So up to them to to make sure that this trust relationship continues.

01:31:25:05 - 01:31:47:20

Christian Soschner

What happens in the team? I mean, you invest in funds. And I also assume that from the hundreds of investments you did not every every fund is a winner and some statistically we lose. How do you how do you handle these situations when your team experience is failures of funds?

01:31:47:22 - 01:32:06:04

David Dana

I would say, first of all, before knowing whether it is a failure or not, it would take time. As we said, it's noontime business. I think now I'm starting now seeing funds in which I invested. When they don't, they are coming to the end of their lifetime. But many, if not all of them, have been gone already through a couple of extensions.

01:32:06:06 - 01:32:27:04

David Dana

So it's long time, not them and it will take time. So I think to know what is always nice when you have already exists because you see quickly the concrete resumes of what you've done. But again, does that mean that because doesn't exist, it would be a big success at the end? We don't know. We will know in a minimum of eight, ten years.

01:32:27:06 - 01:32:35:17

David Dana

So we are tracking that for sure. But I would say that the main criteria.

01:32:35:19 - 01:33:05:17

Christian Soschner

When I think about growing companies and growing funds, I think the the starting point is always one founder, one fund manager, then the trade and your team, the team grows, then they start investing or when it is a company, they start hiring people and suddenly you have an ecosystem that you have to manage. And every single situation, I mean, with a few hundred funds and the funds invested in other companies, you basically shaped the European tech landscape with your activities.

01:33:05:19 - 01:33:16:12

Christian Soschner

And sometimes to hear from founders of fund managers that this responsibility keeps them up at night. What's your secrets to hand with this responsibility internally in you?

01:33:16:14 - 01:33:38:13

David Dana

First of all, it's a shared responsibility. Definitely not for them. So that's why it really helps. But single. So you have to me that when we invest again, even though we are acting from the fund, we do not have a legal entity of it full of women getting money from various sources and ones being European Commission and the Ministry of the German economies.

01:33:38:15 - 01:33:59:08

David Dana

And there are their own objectives within the moment. So it helps already, you know, deciding on what we would be doing. And then, you know, we are all in the management team, we are all experienced. I tell you, for me to give, we are paid for that. You know, this is part of the job. So we have to live with it sometimes to make mistakes.

01:33:59:08 - 01:34:17:24

David Dana

Yes, for sure we did. And we will. We will. No one is perfect. But then the important thing for me is when you make a mistake is to try and correct it is our funds on which we passed for reasons which at the end appear to be okay, maybe we should have done that. Then we come back for the successful generation.

01:34:18:01 - 01:34:45:07

David Dana

It's not the major concern to the extent that they managed to with the system. Sometimes you would never know if it would have been a good thing or not. But again, what is why it's not preventing me from sleeping. Sometimes it does to be freeing because, you know, it's easy to say yes, everything goes well, invest. But in many, many cases we say no.

01:34:45:09 - 01:35:17:14

David Dana

Sometimes the proposals are very, very bad quality and they leave towards overnight. So it's not a big concept In the other. People expect a reduction, but so the good quality one especially, it's super difficult because you know that it may mean that that will have to change if they are correct. Yes. And this is why, again, we spend time on each and every proposal and we we spend time or explaining why we see and sometimes I can tell you some of those calls are not going well.

01:35:17:16 - 01:35:34:22

David Dana

You know, it's not a kind of friendly call, but this is what it is. You know, if every we see was saying yes to each and every entrepreneur reaching out to them, it's not what either. So this is what it is. We are paid to made an assessment on the proposal and on the team and sometimes there's a proposal.

01:35:35:00 - 01:36:06:16

David Dana

It's nice, but it doesn't sit well. On the contrary, some things have hit. It was great. But what I want to do is the thing to do with their experience, knowledge and capabilities. So it's always a question of pessimism. It's message in a constructive way and, you know, not each other or the other speak either one of those calls where we explain why we say no, the people in front of us, let's look at easiest time understood And those who do end and say things for the feedback would work on it and then come back to you, which is perfectly fine.

01:36:06:18 - 01:36:25:14

David Dana

We never say no forever, you know. So it's not like if we were closing the door and that's it, We don't have a single chance to submit to you if indeed, when we say no, if you want us to reopen the case, we need to see some major improvements. If we don't, we want to reopen. But if we reopen, it may be that we say, yes, it's you.

01:36:25:16 - 01:36:53:00

David Dana

No, it's more complex. It could be any problem that some of them are, too. But, you know, we have so many examples of things that we initially rejected, but with constructive feedback, explaining why what we would like to see to say yes for the next time. And it works for many, many of them. So it's again, trusting the fact that we are investment professionals who are doing our best to make the best solution possible.

01:36:54:06 - 01:37:16:11

Christian Soschner

Yeah, investing is an emotional game. At the end of the day, I think this is similar for public investors and private investors and institutional investors. I think it was Maneesh Pride who said at the end of the day you have to realize that 95% of the investments will not work out. But the five will. And with the highest percentage.

01:37:16:12 - 01:37:42:19

Christian Soschner

I think he used two words you said very nicely, because they will grow exponentially and 95% doesn't matter. And this is a balance between, in my opinion, between optimism and critical thinking. How do you how do you balance that in your team, in the decision making process that you on board hands are critical to opportunities, but on the other hand, you still stay optimistic because, I mean, you can also save 95% bonds per copy.

01:37:42:19 - 01:37:44:13

Christian Soschner

Don't invest anymore.

01:37:44:15 - 01:38:11:24

David Dana

Yeah, no, I would say 95% of failures seem to be to 230. Yeah. You know by design that in DC you will have a few were successes but big enough to compensate for the remaining profit. That's the way it works. I would work towards it systematically. No, we have some sense where you have a systematic 23x written on each and every line.

01:38:12:01 - 01:38:22:11

David Dana

It happens, but in most cases indeed it's one or two companies out of the four out of the portfolio of 1015, which is definitely driving the difference.

01:38:22:19 - 01:38:53:20

David Dana

Yeah, let's hope that we will see more winners also here in Europe that bring back capital into the ecosystem and help keep growing the ecosystem. When we look at the situation here in Europe and you will have the possibility to talk to a historical figure about the future of tech in Europe. Who was this historical figure and why?

01:38:53:22 - 01:38:55:16

Christian Soschner

Well,

01:38:55:16 - 01:39:34:00

David Dana

would question who would be a historical figure? Maybe Albert Einstein. I would have to tell him that starting with the integration, there is a lot that we will be capable of doing from Europe and that we shouldn't be saying just expect that they will. Those will help. But just to be brave enough to take the initiative to do things that have not been done yet.

01:39:34:02 - 01:39:43:00

David Dana

And then hopefully it will turn out to be at least both the successful, which would be a big achievement.

01:39:43:02 - 01:39:52:06

Christian Soschner

That's great. It's great when you could recommend a book or a podcast studio audience. Which one would that be?

01:39:52:08 - 01:40:24:24

David Dana

I read this book, The Startup Nation, about Israel and why it has been so successful in terms of venture capital and also how white Israeli behave the way to behave. I mean, these are they do not hesitate to challenge the management. So those executive a member and it invited a lot my vision and understanding of what are the drivers behind innovation and the technology, especially in a hostile environment.

01:40:25:01 - 01:40:53:14

David Dana

You know, Israel at the beginning was a land of idiots. It was nothing. And they will see and they are still surrounded by countries who don't like them if not want to get rid of them. So they had no choice when there was no choice, you know, I'll read in the letters and this morning, following the three terrible events that occurred in Israel, a quote from Golda meir, which was is a prime minister at the time of the war.

01:40:53:16 - 01:41:12:17

David Dana

And she said to, too, I think it was too late. And I wrote who was visiting as a senator, Israel at that time. She said, don't worry, we have a secret weapon that works with us. We have no choice. We have to wait because we have nowhere else to go. So when you have no choice, you have to do things.

01:41:12:19 - 01:41:37:20

David Dana

And since we have an impact and which will have the future and I think or so that's that's a mindset if that you can say it, but don't hesitate to train. And if you fail to try again, if you fail, you will learn what you did wrong and don't do it again the next time. So you always have to build on what you've learned, what you've done to see how to do things better.

01:41:38:00 - 01:41:47:24

David Dana

You can always improve whatever you do. I think that's a yeah. If you can improve on a daily basis, it's already quick. Quick. Listen.

01:41:48:01 - 01:41:48:09

Christian Soschner

That's

01:41:48:09 - 01:42:08:13

David Dana

true. That's true. Israelis, I think, in my opinion, a huge success story when it comes to the start up and scaled up landscape. And it's amazing what the people in the country achieved when you compare it to Europe. I think Austria a similar size. But when you look at the availability of capital and development of the companies, I think Israel still stands out comparison.

01:42:08:17 - 01:42:35:23

David Dana

No, definitely. And I think it's it's it's also relates to the fact that a lot of innovation in Israel originates in development, which is also a very good basis to start new initiatives for the suburbs of business. If you knew how many people working together met each other at the opening the windows, then you need to working together.

01:42:36:00 - 01:42:48:09

David Dana

It creates bonds that go beyond anything, can build in a friendly environment at school, university, wherever. And this is something which drives them and makes it so successful that.

01:42:48:11 - 01:43:14:05

Christian Soschner

I heard this a couple of times. I also had other Israeli entrepreneurs on my podcast and they mentioned the same thing and one said, That's basically the army forms for teams. He said that many teams that met at the Army trains to have a chance to work together, then founded companies and since they already knew the new teams, I was quite well Then you had to work together.

01:43:14:05 - 01:43:23:01

Christian Soschner

They knew the strengths and weaknesses and could start faster on the path to success with the companies than teams that came together the first time. How do you see?

01:43:23:01 - 01:43:52:18

David Dana

That's definitely and that's why I said it's creating bonds that you will have the find anywhere else. And that's again something which makes it so successful that we get to have no choice. And this starts with potentially military applications, but very quickly from there accepting that technology and apply it to other industries, other sectors, and, you know, look at the ways of what they were.

01:43:52:18 - 01:43:57:19

David Dana

It was a type of success. It's, you know, it originated there. And then they managed to to

01:43:57:19 - 01:44:17:03

Christian Soschner

it more global commercial successes. Yeah. Yes, this is coming back again one more time to this mindset to be not that you only need to be in a hostile environment to develop, but ultimately when you have the choice, you just have to do something.

01:44:17:20 - 01:44:19:22

David Dana

And every single day. And so executing,

01:44:19:22 - 01:44:37:12

Christian Soschner

standing, standing, having been having a look at Europe, look, I mean, we have everything here, but a lot of people are trapped in this physical credit market, but they are trapped in this negative mindsets that they complain about a lot of things, but don't flip the switch and start acting and start moving forward.

01:44:37:12 - 01:44:42:18

Christian Soschner

And I think this is the huge difference that the entrepreneurs have to to say, okay, I see the problem, but I do something.

01:44:42:20 - 01:45:16:17

David Dana

Yes, Yes, for sure. And again, as it was historical, this is feeding into a model, if any, this behavior. When you've said somewhere you've done forever, where has into us and Israel. When you fail, you build and use and you do better. And this is the main difference in my view. Yeah. My point of view that once we will be able to change this, then we would be playing at the same level of the other ones and you see more and more people trying to do this.

01:45:16:19 - 01:45:48:12

David Danaa

You see so many young people trying this entrepreneurship way or going into more technical need to do. You saw those reports and it falls on them. The companies where students want to work up till the finish of this, it's not in the minds of big companies where you can save on your lifetime. Sure, they want to go either to launch their own business or to join a very dynamic, smaller entity.

01:45:48:14 - 01:46:09:21

David Dana

It shows that, you know, it's not anymore the case where we'll will have maybe two or three companies to go your whole career, you will have maybe five. That's not a good example for that. But if you as long as they like what they do when see it can have an impact, what they say is if I continue doing what they make.

01:46:09:23 - 01:46:30:08

Christian Soschner

I will be 30 years, 13 years at CEO. If you stand out of the career when people tap into the startup world and start working with early stage ideas, they will have they probably have 13 companies in a year. So I mean, a lot of it doesn't work out and people have to be flexible. But you mentioned the past mistakes.

01:46:30:08 - 01:46:30:19

Christian Soschner

I mean, I

01:46:30:19 - 01:46:38:21

David Dana

remember my school days here in Austria as basically being punished for making mistakes and.

01:46:38:23 - 01:46:58:07

David Dana

Then you look at the startup company, you need to accept that you will make a lot of mistakes because you don't know and it doesn't matter as long as you fix them. How is this code system in Israel in that respect? How do you train the kids when it comes to making mistakes?

01:46:58:16 - 01:47:26:09

David Dana

I think the approach is very different from the stance compared to what we have in France. So I'm French originally, I grew up in France and I still recall some friends who was struggling with some math of French lessons very quickly. So we're kind of single out and we see very negative comments and not offer other options. In other words, it might be a bit different.

01:47:26:09 - 01:47:48:05

David Dana

I don't know enough to keep you motivated, but I have some family that was kids. At least when the kid is sitting at something, he's identified and pushed for a while, meaning that that gave him the opportunity to develop further, which is something, you know, I'm living in Luxembourg and my kids are going to an English school and this is something I like very much.

01:47:48:10 - 01:48:14:08

David Dana

That's when the kids agree to include some specific topics. They are given the opportunity to go even beyond that and to do other. And that's something which is very important for the self-confidence of the kids, for their capacity to think that they can do more than what they asked to do. And if you don't have this mindset that you can do more,

01:48:14:08 - 01:48:16:22

Christian Soschner

you would never do more than what you asked.

01:48:16:22 - 01:48:23:02

Christian Soschner

And that's maybe the limiting factor. What we have seen in Europe to some extent now.

01:48:23:04 - 01:48:57:14

David Dana

I think it is biochem speaks to mindset. When I remember my school days, I think there was a lot of effort in working on the weaknesses and when people had strengths, it didn't really matter because I mean, yeah, you're strong antibodies in that area, so why should you foster work more in that direction, work on your weak points, which led to the situation very often that when someone really was spent in mathematics or languages they had to spend a lot of time in things they didn't want to think and couldn't because you that passion project, it's good to hear that.

01:48:57:16 - 01:49:00:23

David Dana

That's called sexist. I was in Europe to tell it differently these days.

01:49:01:05 - 01:49:13:02

David Dana

Yes, yes. Again, it's everything is the same in for most of the school that work anywhere you like what you do, you can do a better job. It's simple that.

01:49:13:05 - 01:49:27:14

David Dana

Is is probably the most important lesson for entrepreneurs and investors. They really should like what's what's they do because I mean, venture funds, when you pick a venture fund, they are in for at least a ten year game and it's not over in six months.

01:49:27:16 - 01:49:33:06

Christian Soschner

No, no. Another 15. The church in Germany, that's a six months. That's going to be a multi contract.

01:49:33:08 - 01:49:40:00

David Dana

David I'm through with my question to be have is there any question open that you would like me to ask.

01:49:40:08 - 01:50:09:12

David Dana

No, but maybe just a message to Claire that, you know, the life might be perceived as being a bit of a complex organization from the outside, but don't hesitate to reach out to us. You know, if you have an interesting project, if you are a new GP with a a strategy which makes sense and where you can show that you will be doing a good job, let's discuss it may not result in the commitment arena.

01:50:09:16 - 01:50:31:18

David Dana

I don't know. I strongly believe that the more people in those better since you can do and each you can do it, you know someone to make a kind of an investment. You can see a lot of things. We are always helping. Also as a French to support when they are asking you, you see the people in one or the other field because as I need to hire new people.

01:50:31:20 - 01:50:52:03

David Dana

So it's an ecosystem which is very much interpersonal. So we all need to make sure that there's a strong support and we help each other. And again, if we have the capacity to do meaningful structuring things, just give us a chance to let us know what you do. If you didn't do this.

01:50:52:05 - 01:50:55:07

Christian Soschner

Maybe what's the best way to reach out to you and?

01:50:55:08 - 01:51:21:23

David Dana

TAF I would say you should not already have a direct contact with any. Yes. You know, usually we have quite a number who are quite active on social networks, so easily reachable if not so you can virtual contact that kind of generic address, email address from Yes, but always a direct effects of not hesitate to reach out to the team Twitter or whatever it would be

01:51:21:23 - 01:51:23:23

Christian Soschner

happy to to follow up.

01:51:24:00 - 01:51:40:16

David Dana

David, thank you very much for your time. I enjoy this conversation very much and I'm happy to learn more about the activities of your organization and how you shape the future of Europe. Keep up the good work and move Europe forwards into the post position.

01:51:40:18 - 01:51:45:16

Christian Soschner

Which I thank you very much. Thanks a lot for for this discussion really. Thank you.

01:51:45:18 - 01:51:46:15

David Dana

Have a great stay.

01:51:46:16 - 01:51:49:24

Christian Soschner

Bye bye.

01:51:49:24 - 01:51:54:05

Christian Soschner

As this episode with David Dana comes to a close,

01:51:54:05 - 01:52:00:05

Christian Soschner

we have taken a deep dive into the evolving world of European technological innovation.

01:52:00:05 - 01:52:12:21

Christian Soschner

from exploring the potential of quantum technologies to understanding the strategic deployment of capital. David has shed light on Europe's path to tech serenity.

01:52:12:21 - 01:52:20:10

Christian Soschner

His vision is clear Europe is not just a participant, but a leader in the global tech arena.

01:52:20:10 - 01:52:38:23

Christian Soschner

Thank you for joining me on this insight for turning your engagement and interest are what drives this podcast forward. If David's perspective have sparked your curiosity, let's spread diverged together,

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Christian Soschner

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Christian Soschner

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Christian Soschner

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01:53:18:04 - 01:53:25:03

Christian Soschner

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01:53:25:05 - 01:53:30:11

Christian Soschner

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