Dear Friends & Family,

In the race between humans and machines, a recent high-profile coding competition ended with a Polish programmer narrowly beating OpenAI’s model by just 9.5%.

I’d bet on Polymarket that this has been the last time a human claimed victory.

Billions of dollars are now being poured into a new AI coding arms race, very reminiscent of the cloud wars a decade ago.

OpenAI resembles Amazon Web Services: the "established" leader.

Meanwhile, Claude is shaping up to be a fast-growing contender, offering clever features similar to those of Azure or Google Cloud at the time.

Anthropic’s Claude may not yet lead in market share, but it is arguably becoming dominant in performance and influence, particularly in developer tools.

Billion-dollar AI wrapper companies like Lovable and Cursor are built on backbones they don’t control. Windsurf learned that the hard way: a planned acquisition by OpenAI led to their Claude access being cut off overnight.

Such dependency would have scared investors away in the past.

But this time, it’s different.

The old rules of venture capital are shifting, and the capital now in play is staggering.

When FTX collapsed in November 2022, $8 billion in customer funds vanished. But Sam Bankman-Fried had also invested in Anthropic as early as 2021.

Had the FTX insolvency administrator held onto this 8% stake, it would be worth $12 billion today, more than enough to compensate for the FTX trading losses.

AI will unlock almost infinite use cases. But the ability to build whatever you can imagine and instantly turn ideas into products is a profound game-changer.

We’re not quite there yet.

As every Lovable vibe coder will tell you, prompt engineering still isn’t production-ready. But give it a few months, at most, a year, and that will change.

And maybe, just maybe, open-source Chinese LLMs will evolve so rapidly that Claude will be worth a lot less?

With so many things changing, what will stay the same?

Our conviction remains strong: technology will continue to shape and fundamentally improve human life.

And outstanding founders, wherever they are, will continue to build the future with relentless determination.

“Time to copy” won’t be how fast Lovable can spin up a DocuSign clone.

The real moat lies in deep domain expertise, obsessively listening to customers, building strong communities and brands, and delivering better user experiences.

Most companies won’t build software from scratch. They’ll focus on their core competencies and assemble off-the-shelf software from modular blocks, powered by reliable API tools and shared data lakes.

People will be able to do so much more with so much less.

However, we will always need bold, visionary founders—those who see what’s possible, know how to build it, and take the leap to make it real.

It’s a great time to invent.

Portfolio Updates

Everyone in crypto is talking about stablecoins these days.

Our portfolio company Talentir, based in Vienna, saw this coming early—we backed them in April 2023.

They’ve built a payout platform purpose-built for the creative industry, eliminating the administrative headaches artists and agencies typically face when managing payments.

Even better: users can earn interest directly on the stablecoins held in their wallets.

But here’s the remarkable part: Talentir does all this without ever mentioning “blockchain” or “crypto” when they talk to prospective customers.

They’ve introduced a level of ease of use that’s rare in the crypto world.

For years, people have said that blockchain adoption depends on user-friendliness.

Talentir is showing the way.

Congratulations to Lukas Steiner, Johannes Kares, and their incredible team.

And it’s not just us—their clients seem to agree.

Talentir isn’t our only bet on stablecoin infrastructure.

Check out Level—we invested in November 2024.

Kedian Sun and David Lee are focused on turning your stablecoin deposits into yield-bearing instruments, designed with simplicity and low risk in mind.

These guys are deep thinkers and they’re only just getting started.

Based in New York, they’re right at the heart of the US stablecoin momentum.

And then there’s Recall working out of Amsterdam.

If you want to understand how your portfolio companies are really doing, don’t just look at their monthly investor update.

Jump into their Discord and read what paying customers are saying. What they praise or complain about.

Or better yet, watch a customer video and see the excitement for yourself.

The Recall team, with Paul Richards, Sankari Nair, and Igor Gligorević, continues to impress us with how closely they co-develop with their users.

If you’re drowning in information and haven’t found an easy way to retrieve and learn from it, try out Recall.

Built by people who live and breathe knowledge management.

Recommended

Founder stories are often romanticized and glorified.

Scroll through social media, and you might think that every founder effortlessly makes it big.

But even founders who make it rarely talk about the panic attacks, the sleepless nights, the relationships that crumbled.

That’s why I was intrigued to hear of a successful founder who went through hell and back, and then decided to write about it.

His name is Xaver Lehmann. I’ve known him since 2013, when he worked as an intern for us.

Fast forward a few years, Xaver went on to found a chatbot company, which he successfully exited for $60 million after just five years.

On paper, it's the perfect story, the dream outcome.

But those five years were anything but ordinary.

You think a dog year is 7 human years? How many for a founder year?

And the exit doesn’t magically fix the damage.

After the successful sale of his company, Xaver didn't celebrate. He went through a long and painful recovery from total burnout.

Few founders I know would choose anything other than building their company.

But some forget that the journey often takes 10 years or more.

And if you don’t take care of yourself along the way, you might not be around to enjoy the fruits of your success.

Xaver has begun publishing a series of blog posts about his journey to raise awareness for this issue.

I recently met him in Munich to get more background information on his story.

He told me he might eventually publish his founder story in a book.

Until then, subscribe to his blog or follow him on LinkedIn to catch a new chapter every Tuesday.

It's recommended reading for any founder in the trenches and everybody else in the start-up ecosystem.

Welcome to our new investors

We’re deeply grateful to our new investors who’ve recently joined our already incredible group of backers - and to those about to join as I write this.

Your trust means the world to us.

We’re excited to pass that trust forward to the remarkable founders we’ve already partnered with, as well as those we’re about to (there’s a lot in the pipeline).

We wish you a wonderful summer, filled with plenty of inspiration.

All the very best,

Wolfgang (Frankfurt) with Ben (Berlin), Marcel (Munich), and Sagar (Munich)