Harry Stebbings: Europe is 'solidified as a block,' Lovable growing $2.5M ARR per week with 85%+ retention

waiting room. Yeah. He was saying he listens to the show and I think we finally made a show that's long enough for his marathon walks because the guy's putting up 40,000 steps a day. Uh, how many steps have you racked up today? 50,000 now. So every 50,000 London like 2 and a half hours and I listen to you on the walk.

It's fantastic. Uh, we got to So So just let us know when we need to go from three to four hours cuz we want to pace with your walking your your your steps. Honest honestly, I walk with my mother on the weekends. If we could do weekend editions also, it would save me having to talk for six hours with her.

I love it's been it's awesome to see uh your relationship with with your mom. Sometimes makes me feel like a bad son because I don't walk for for that many hours with my mother. But I was just saying uh you had a nice message yesterday on the timeline.

Thank you for it's interesting you know that the shows that we really respect all of them are highly ephemeral right like they're they're shows that aren't really oriented around the news. They're oriented around individuals, people, companies, etc. And ours is the exact opposite, right?

Like it would be kind of crazy to go back and listen. You know, sometimes we'll talk about a story that that maybe is more evergreen, but um uh you know, you've built up this sort of crazy catalog of of some of the most amazing investors in venture ever.

Uh I I wanted to have you on for a few reasons, but really to give you an opportunity to to talk about Project Europe. Uh we joked on the show that until you guys came out with this new program, the project Europe that most VCs thought about was planning their sort of uh trips to St. Trope uh over the summer.

But uh you guys are taking it back. Do you know what? We're taking it back. We also have Portoino. Yeah. And fundamentally the world has decided that Europe has, you know, lost innovation. We've lost entrepreneurs. And I meet great founders every day. And do you know what they're told? you got to move to the valley.

And I'm like, you don't have to move to the valley. You can build a massive company here. And I think bluntly, we need to change the vibes. Vibes is everything. Elon, you like him or you don't. The guy knows how to master vibes.

And for us now, we've told our young entrepreneurs that you should leave, that you should build a company elsewhere. There's a guy Gary Stevenson who is blowing up in the UK who tells young people that bluntly it's the system's fault. It's not your fault and it you know there's nothing you can do about it.

There is I was guys 10 years ago I had no money. I was a kid in a bedroom. Today we manage over $750 million the show and the media companies multi multi-millions because of the internet. It's I'm not doing that as a me.

It's the internet and the empowering nature of I I DM'd Mark Benny off 53 times before he came on the show. I I I I we we by the way we remind sometimes we'll message a friend about coming on the show and they like don't get back right away and I'm I'm like I got to channel Harry right I just got to hit him up again.

And and it's important to share those. A lot of people would just, you know, have the temptation to make it look easy. Yeah. And say, "Oh, yeah. I just messaged Mark Benny off and he just like popped on. It was easy. " But it's important to remind people that that persistence is what creates Totally.

I mean, Logan Bartlett's the same way. I think he I think he DM'd he he said he emailed SPF like 15 times to try and get him on the show. And I was like, I don't know how you could do that. It feels so awkward to me. But you've clearly like broken it down and it's paid off massively. But you know what?

You've got to get innovative. I use Suno. ai. AI to write songs about people and then I send them to them. So I'm like, you know, write me a song asking John in a like male folk guitarist tone about you the future of M&A and then I'll send it to them. I promise you you're the only one who's going to do that. Yeah. Yeah.

Yeah. Yeah. Yeah. I mean, it's so important in like fundraising, sales, and you know, even growing a podcast. It's all the same thing. Oh my god. Totally the same thing. But but on Project Europe, yeah, it was like the doom loop just pervasive. And I have so many friends in the US who are just like, "Europe, dude.

Like, why are you still there? " And it's just it's just not true. But the timing, but but the timing seems incredible. You've been, you know, banging the the the the European drum for a while now. But it does seem like even in the last month almost, there's been this sort of shift.

And that's sort of potentially coming from this, you know, the US is getting into trade wars with our neighbors, our some of our closest allies. this just sort of like nationalism happening around uh Western Europe kind of waking up.

You know, people are are there's more uh you know the people are talking about what is going to be the ander roll of of Europe. You know, I'm sure you're looking at some of these companies, but the timing seemed great.

Uh do I think we're going through this intense period of deglobalization and what happens in intense periods of deglobalization is intense patriotism. And I think we're at the start of that now where absolutely we're starting to see Europe once again get a little bit more patriotic.

Um you it's funny you said there about like the Andreel of Europe. It's Helsing. And my favorite thing is when you see defense funds and you're like no no I don't don't quite know if defense is quite the category. It's more like Andreel and Helsing like Yeah. Very cool. Uh do you I'm curious. You you run your fund.

You run the the media business. Do you LP into other European funds?

are you trying to kind of create a sort of like I imag one of the benefits a caretsu no but one of the things here in America is great if if I've got a buddy who's raising a preede round I talk to them I'm like okay I know 30 people that could lead this preede round like don't worry if any one person says no like you're going to get a yes talk to a bunch of people but I imagine when there's probably not 30 London preede funds that you kind of at the moment but maybe there should be or maybe there are I I I mean I don't actually LP really into other funds just because with the network from the show if I LPD into one I'd have to LP into all of them and so I find it easier to say just like I'm sorry I can't do LP checks otherwise you end up being Mark Andre where like I don't know a fund that Mark Andre is not in I've been so many funds where Mark is an investor and so listen he has more money than me and can afford to do that I couldn't do a hundred funds can you tell us a little bit about uh the the patriotism in Europe.

Is there are there layers to this where, you know, a Spanish company will only want to raise from Spanish investors and say, "Hey, get this British guy out of here, or is is Europe kind of uh solidified in the same way that the United States is kind of a block even though obviously there's a difference between Florida and New York and California?

" I would say that Europe has solidified completely. There's definitely not this kind of isolationist uh element of like, oh, Spanish versus Italian versus whatever. And Jesus, even the English and the French are getting on these days. That goes to show just how much of a united front it is.

And I think especially in the wake of, you know, the divide that's growing between the US and Europe, that becomes ever stronger that unified country element of Europe. And so I I don't see that at all. And Europe really stands as a block. And I think you see that in how people have responded to project Europe.

And we've had, you know, thousands of applications. I started with 25 founders that I was like, hey, I'll go get 25 founders that are amazing and they will, you know, write a check into this vehicle to back the next gen. Literally went to 150 in 3 days. We've had another 3 to 400 requests to be in.

There's a legal cap of 250, so we can't actually do it. It was amazing. uh talk about when when you you were an early investor in Lovable, they've seen ridiculous growth. It's one of those charts that's not really, you know, a line. It's more like a wall. Yeah. Um was that talk about that round how that came together.

Uh are you getting these companies like weeks earlier than American, you know, investors that would that would want a shot at it? Is it is it months? You know, talk about your edge in Europe on the ground. Yeah. Yeah. 100%.

Um, Lovable is a great example of a global company that's being built from Europe and Sweden in particular. Um, their numbers are insane. They're growing, you know, 2. 3 to 2. 5 million AR per week. Their retention is better than chat GPTs at over 85%. I mean, it is a monster and their retention is really important.

It is not sugar high AI revenues and so phenomenally impressive. Listen, Anton is quite obviously brilliant. I think we overexaggerate how difficult our role is as venture investors. Our role is to invest in the 1%. And generally the 1% I find is quite obvious.

And so when I met him, it was pretty apparent that he was bluntly creating an entirely new category. I've learned one thing in investing that when you're able to make your customer a superhero, it generally works very well. Nike is a good example. Everyone's an athlete. That message is empowering.

Shopify, everyone's an entrepreneur. And Lovable allows anyone to build a website. My mother who has a bakery uses Lovable to make her bakery website. That is I I love your commentary on just the website market in in general.

The sort of, you know, you've got the framers, the web flows, you know, all these different platforms. It's felt over the last few years.

felt over the last few years if you just waited for, you know, Web Flow to kind of become four years old, then you could create the framers and then you could do the lovable like the unending gold mine, honestly. Yeah.

And it seems like you've got a you've got a couple of different segments here that I don't think people are really talking about enough, which is like you've got the number ones, which is Powned, larger, older players. Now, they are in a lot of trouble. They've lost innovation. They've lost product centricity.

um they're in a real world of pain. I'm really looking at a lot of the PE board assets, your Anna plans, your Koopers of the world, thinking, "Wow, you were bought at the height of the market. You don't have the founder as a CEO. You've lost product centricity.

This is going to be a really tough slog to get back to that acquisition price and they know that. " And then the second that no one's talking about either is this really worrying segment. This is almost what I'm most worried for.

50 million to 200 million AR SAS businesses that are growing in the teens and they're not profitable yet or they're barely profitable. They are not acquisition targets for PE. Those are not good enough numbers. They're not good enough to IPO.

What happens in that case and there's a lot of these companies that is a really dangerous chasm to fall down that I don't think many people are talking about. What about uh just the broader market? We're seeing a pretty significant selloff in the US. Is Europe seeing something similar?

I haven't been tracking it very closely. When you say sell off, what do you mean?

Yeah, I think he's talking public equities, but I mean, in your position, do you, as an, you know, a venture investor, you probably don't care, but I even talk about maybe just like pricing in the early stage market, which is probably what you're more clued into. I mean, there there's there's so many things here.

I I think one thing that no one's talking about, I'm so shocked about it, is like bluntly how LPs are responding to a lot of the endowment um policy changes enacted by a Trump administration. I mean like this is a very very uh difficult position for a lot of endowment funds to be in.

They're forced to rethink a lot of their private allocations. Um and that will significantly impact managers abilities to raise funds this year. Can you sit back and explain exactly what the change is?

Well, so you're seeing essentially the Trump administration reduce a lot of the budgets that they're able to have to their privates. And so you're seeing that reflected in how they're engaging with new managers.

When I speak to a lot of endowments today, they're simply not adding new managers and they're even trimming their existing. And so I I think that's bluntly going to really impact the amount of new managers that we see this year.

Um, in terms of pricing, honestly, it's it's higher than it's ever been for the clearly great assets. And there's a lot of people who come and say, "Oh, it's so unfair. It's so unfair. " I understand that for a lot of the market, you're not coming out of Stripe or Facebook or you name it.

But if you are, you have more money than ever before. And the prices are honestly higher than ever before. The prices are absolutely nuts today. And so you either have to be if you want to win in Vantage State, you have to do one of two things.

I believe I'm a better picker than anyone else and can find diamonds in the rough or I believe that I am such attractive capital that I can win a beauty contest and still pay a very high price but beat everyone else. Yeah. Do it all at the same time. Uh no, I think that was it.

Uh it's funny like any investor who's claim claiming you know uh uh complaining about high prices is just like just price every investment perfectly and never miss you'll put up a great fund. It's by the way entry price really matters when you look at whiz and insight something very um timely.

You know their entry price was very high and so people are really [ __ ] on it as an investment saying like oh it only returned a third or a quarter of that fund. It's not. It's just that the entry price was so high. And we'll talk about that. I'm curious. Do you do you know any dynamics?

Because I was wondering, imagine you're the the partner who leads, you know, $200 million investment, turns it into two. 5 billion, and then you're kind of waiting around for your other partners saying like, I kind I kind of did the heavy lifting here, but I need you guys because they're not in carry yet.

Is there a scenario where that partner doesn't really see much of a a personal benefit from having, you know, returning $2 billion? I mean, let's just say I think they'll be getting a pretty big bonus at the end of the year, so I'm not too worried about them.

But but I mean, it is just testament to the like fun size matters. Yeah. The scale the scale is massive. It's never been bigger. Yeah. Yeah. All right, Harry. There's a lot more to talk about. We'd love to have you on again. Go enjoy dinner. Thanks for coming on late. Yeah, we appreciate you coming on late.

We really appreciate it. It's fantastic to have you and we'll talk again. You you are fantastic company on the walk. Always let me know what I can do. and huge love, guys. Fantastic. Thanks so much. Talk to you soon. Enjoy your evening. Cheers. Yeah, I was coordinating timing with him and uh being in London.

Well, he seemed like he got to a great uh podcasting studio. I mean, he's locked in. He's locked in. You love it. Over time. Over time, we're going to get the Delian's like a permanent sort of like hub in the office. Just say, "Come flip on the lights. You'll be live. " You know? Yeah. We'll we'll set it up.

Uh the remote studio. I mean, that's what uh the the the big TV channels uh do. It's like, "Oh, if you're doing a spot on, you know, NBC, go to the local NBC affiliate in your town, and we'll have a green screen and a great microphone and a uh and a teleprompter for you, and you and you'll look great.

Uh, if you can stop by. " Uh, anyway, we got Adam coming on the show in a couple minutes. Uh, give me some background on Adam. How'd you meet him and what does he do? The godfather of media, Adam Ryan. Um, that is a bold intro. So, Adam Ryan's a a very good friend.

Um I was actually on the board of his company in the through the series A. Um and uh he prior to that was at the hustle. He like ran sales there. Eventually was the I think the president and the COO. Got it. Under Sam Par. He also was at uh Under Arour when they acquired My Fitness Pal.

So he's just been kind of like right in the He also was at um he was at uh Spice Works as well. So he's always been at kind of the intersection intersection of like software and business uh media and content and so he can talk a little bit about work week.

Um and then I wanted to get him on to talk about the Techrunch acquisition that happened today uh which uh there's a lot of turmoil. Has the number actually leaked or is that private information? It's private