If you're a European founder scaling deep tech and stuck in
the web of fragmented investment rules, here's your
challenge: cross-border early-stage investments in Europe is
painfully slow. Legal fees are high and standardized
instruments are missing. Tomas
Matsurik, co-founder and co-CEO of FundingBox and
managing partner of FundingBox Deep Tech Fund, built and
exited tech companies, now invests across Europe and
leads the EU-funded DeepSafe project to create,
to create what is called EU Scale, a pan-European
convertible loan instrument. Today we'll uncover
how to navigate European startup funding, fix the cross-border
investment gridlock, and unlock deep tech capital flows
that could reshape the continent's innovation scene.
Welcome to startuprad.io.
Your podcast and YouTube blog covering the German
startup scene with news, interviews, and
live events. Our
guest today, Tomasz Mazuryk, brings a rare
trifecta. He's a founder who built and sold
NetSprint.pl, an investor deploying capital
through Fundingbox Deep Tech Fund, and a builder designing the
next layer of Europe's startup infrastructure.
With a PhD in computer graphics from Wien,
an MSc from IT— in IT from Warsaw
Institute of Technology, Thomas has developed over
1,500 startups' access, acceleration, and funding
through FundingBox. Now, as technical coordinator
of the DeepSafe project, he's steering the creation of EU-scale
Europe's first standardized pan-European investment
instrument for early-stage funding. So if
you're a founder, investor, or policymaker
wondering how do I raise or invest across Europe without
drowning in legal fees and red tape, you come to the right
place. Tomas, or Tomek, welcome to the
show. Um, for everybody
familiar with investment instruments, Would
you say the EU Scale is like the
European answer of Y Combinator SAFE?
Hello everybody. Hi Joe, thanks for having me here.
Um, well, that's our mission. That's the mission we have onboarded on, uh,
to create the pan-European instrument facilitating
faster and more seamless
investments at the early stage. The
issue that is pretty important right now
in Europe, because the deals in Europe are happening on average
3 to 5 times slower than in the US,
and I would assume that at the early stage the gap is even
bigger, especially at the early stage where the deals should be
happening really, really fast. I was just
recently talking to one of the board
members of the European Business Angel Association, and he
told me about two valleys of death, one very early stage and
one pretty late. And I think you, you're, you're more
or less also talking about the experience many founders have of the
first valley of death, but there'll be a different
interview. Um, you've built companies,
you've invested across Europe. Take us back to your founder roots.
What drove you to start netsprint.pl, and
how did that experience shape your later mission to rebuild
Europe's startup funding infrastructure? Well, we are
digging into the really, really past stories.
Uh, we founded Netsprint in the, uh, so-called pre-Google
era. So Google was the local player
back then in on the US market, of course with the global ambitions.
Um, but we came on the mission, uh,
within my current back then company with my business
partner. We've been running the software house. So we
created something that we know it's called
nowadays incubation program. Back then we
simply have announced, come to us with ideas
and we are going, if we like the idea, we are going to fund it.
And support it. So back then
I took the multiple roles, uh,
of an angel investor, uh,
but in fact it was also the venture building
role. And we have incubated and
venture built the startup called NetSprint. Again,
back then we didn't know it's called startup. It was supposed to be
the company.
And we were on the mission of building the first
search engine of the Polish internet. Back then, Google
didn't cover Poland in an efficient way. The AltaVistas
and other search engines were really, really poor.
So we very quickly got the market traction.
We created the company Just
weeks before the dot-com bubble
crisis. So after setting up the company, uh,
we had a couple of conversations with investors, uh,
from outside of Poland. They were very excited,
but then the dot-com bubble crisis came and
all the dreams about getting any money has gone
bust. So
we went all the stages from the founding of
the company with the really angel tickets coming from
my pocket and of my partner's, business partner pocket.
And then we have been developing the company without any
external funding because on the local market, uh,
there were no investors, no VCs back then.
All the foreign investors after the crisis, dot-com uh,
dot-com bubble crisis, have stepped back.
So for the 6 years we've been running the company and growing this
as in the bootstrap mode. So when I look, uh,
back and try to compare this to the
nowadays, I must say that today founders are in the very
luxury situation. They've got
money available on different stages of the company
development. They've got co-works. They've got
venture studios. They are just asked
to come up with their ideas and develop them.
So, you know, after 6 years of— 6
difficult years, we have been able to make
an exit to the global player from the media
space. And then after
the exit, I got a little bit
step back, time to reflect what to do in life. I did
a bit of the consulting, but after
some time I decided, well, it's time to do something
next. So on the other side of the barricade, which
is the FundingBox platform and FundingBox company,
that I'm developing right now is the platform to support startups.
So we decided to, to, to support startups, uh,
through the acceleration programs. And after some
years seeing the great deal flow of startups coming from all over
Europe, uh, I also founded the
venture capital fund that is investing in the
best startups, from the local
ecosystem. You're getting a little bit
ahead of me here, Tomas. Um,
let us walk through all the questions, and I'm sure we'll touch on
everything of that. Um, let's talk a little bit about the current
status quo. Everyday founders in Europe face different
legal and tax reality in each country.
How would you describe the current state of European startup funding,
especially for deep tech and cross-border deals?
Well, the European startup scene is
growing, but it cannot
boom because the investment landscape, uh,
is still broken. You've mentioned in the introduction
about the two valleys of death, and here we are
covering the first one at the seed stage. Let
me come with an analogy.
Probably all the listeners of this podcast still
remember different chargers
for every phone they've been getting. I remember my
every Nokia phone was coming with a different charger.
And now if you've got a couple of phones
in your family and then every phone has
a different charger, it was a mess. You could not reuse your
charger. Then the USB standard came, now the
USB-C, and now
you've got— you can have the same charger, same cable for your
laptop, for your phone,
for your electric toothbrush, for the Oura
Ring, and all the other
devices. And I must say, it's a huge, huge relief.
So now,
how how to, to put this analogy into the startup ecosystem?
Well, in Europe, startups are trapped within
27 different legal and tax systems. Uh,
practically, uh, of course it's possible
to make the cross-border investments, but it's making them
slow, expensive, involving too much
legal activities. So
it's making them expensive, and especially at the very
early stage, the seed stage,
those costs are relatively too high
compared to the size of the ticket startups are getting.
So that basically means in every of the
27 EU member states you have to deal with different
laws regarding, uh, taxation as well as investment
funding. So that means it makes cross-border
transaction pretty expensive and inefficient,
right? Exactly. And that's why we are on the mission
on bringing the US SAFE type of
instrument to Europe that is universal, that
could be applied almost on the spot to
make the investment without too
many work around it. I was wondering,
at some point you you realizing— realize that
copying just the US SAFE model just wouldn't work
here. What was that moment of clarity, and what
did you discover about why Europe isn't ready
for US-style SAFE? And a little disclaimer here, I know there are always
details making this impossible. For example, in Germany, when you
finally convert the safe, you still have to invest a little bit,
which is not in the US legal tradition, and so on and so forth. So
basically, they always needed to be adjusted, at least
in Germany. Yeah, well, and the
reality is, um, that there are some
adjustments needed, uh, in every
country, or almost every country across Europe. So
We started our DeepSafe project,
and after 9 months of
making an effort to fit the US-style
safe into the European reality,
well, literally I can say that we have hit the wall because we have
found out that this is not possible to make it in a simple way.
So We have confirmed, making
the consultations with some selected investors,
that basically Europe is not
yet ready for the simple adaptation of US SAFE.
The legal accounting tax realities and the no clear
vision how to treat it, whether it's a debt or an equity.
And on top of this, there are coming
additional considerations, like for example,
the so-called difficulty situation of the company.
If you take the capital into the company,
which you don't know how to classify, a debt or an
equity, most of the accountants and tax advisors will say, okay,
let's take it as a, as a debt. This
is sitting on your balance sheet. And
too much debt, uh, after
some time, like 3 years, is creating the so-called
difficulty situation of the company, which
doesn't allow the company to get any public help, any grant, any further
investments that are backed by the public money.
So there are many consequences of this status quo.
So just to recap before we move forward,
there is a lot of money in Europe, but
it comes with the limitations of the public money also.
I mean the grants, but also the funds that are backed
by public money. Because
of that, many investors that are backed by
public money are too risk-averse. So they
are paying too much attention on the downside protection,
and they are not paying enough attention to the
upside potential that is coming with the deal. And basically, you
know, the American way of investing is, uh, looking
at the upside of the upside potential of the company.
So, uh, that's why our ecosystem
is simply not ready yet, uh,
for the full deployment and the
growing in the way that we would be
expecting to grow. That's, that's my take. So there
are like two elements. One is the legal
constraints, but also the readiness of
the ecosystem. Um,
we've been talking a lot about different, different
costs, especially, um,
when investing cross-border. Can you share a story
of a promising cross-border deal that
fell apart because of legal or tax barriers?
What did it cost the founder, not just in money but also maybe
in lost momentum?
Well, I think you've touched a very good point. It's
not about the money. It's mostly about losing
the momentum. And
well, I have seen in my life
hundreds of the negative examples.
A couple of them we have witnessed
in our investment fund.
Once we have rolled out our fund,
we have been using the full potential of the FundingBox
Group to look into the European pipeline of
projects. In the first 6 months of
running the fund, we have found 3
excellent startups from Western Europe.
But it ended up that due to the limitations, due
to the costs, the potential costs of the transaction,
uh, the cross-border transaction, those deals didn't happen.
So on the business level, we,
we have been aligned, we have put the term sheets,
but then in the framework of the implementation
the deal simply didn't happen. From the
FundingBox acceleration platform, I can
give one example of the startup, an Italian startup, Cognivix,
that after 2 years of going
back and forth with, with the lawyers, they finally
set up the office in the US.
And got the investment. But
so this is the so-called Delaware flip. But you know,
it was the time, it was the momentum, and it was really, really
the complex operation. But well, speaking about the positive
examples, probably
you, all the listeners have heard about the recent
unicorn coming from Poland, 11Labs. Polish
founders, uh, after 3 years
of running the company, they have hit the valuation of $6.6
billion. But here
is the twist: after analyzing the
landscape, they decided to set up the company in the US and
start fundraising into the US company from
day one. So It is the positive example of
the company coming from or born in the CE,
but the negative for the, from the EU ecosystem perspective is that
they decided to go directly to the US. So those are the
barriers, those are the limitations that we are working on to
eliminate them. And that's our mission.
I was wondering, instead of forcing a
safe you pivoted towards
a pan-European convertible loan as the foundation for
EU scale. Why was this the
smartest starting point for Europe, and what lessons did
you learn from the initial missteps?
Yeah, well, as I said before, US
SAFE adoption failed, the simple one.
So we have pivoted and decided
to concentrate on something that market
already knows and is familiar. So
all investors in Europe, all startups in Europe are
familiar with the convertible loans.
Uh, still the convertible loans can be very
complex. So we decided to
onboard on a mission of creating the EU simple
convertible loan agreement. We call it EU Scale,
and we believe that this approach gives the
chance to gain the traction and trust among
the startups and investors and is going to, to
help to facilitate the speed of the deals happening
across Europe. So it is very
simple, 2.5 pages. Uh.
No interest on the loan, no cash repayment,
no specific guarantees for the investors, just
the promise of the future
most favorite nation of the shares
at the future conversion, which is the standard
when, when getting shares in future.
And well, we stayed true to our goals. So we
wanted the standardized and simple agreement.
We are using the convertible note as the true starting point.
And just to remind
That's how the US SAFE originally was
born. It was the American adoption of the
convertible notes that were very popular on the market.
So in, in the framework
of our project, we plan to encourage some investors to start
using our template and
adopt it. And then hopefully the others are going to
follow and we believe in the snowball effect on the market.
So after a few positive examples, after a few examples
that the deals can happen fast, we believe that it can
become the new normal.
So as I said at the very beginning,
the US deals are happening 3 to 2 times faster than
European. So we are on the mission with this approach, with this template
that everybody's on the, on the
startup and investors seem familiar with to make this
gap smaller or even liquidate it.
In the founders world, you'll also tell some inside story about
stories about that. But let us go into building trust.
As you said, one adapts and then more people will adapt.
Um, you've said before European investors are distrustful of
automation. How did that insight shape your approach,
especially regarding AI funding platforms
versus one-on-one, the, the typical human trust
building? Well, our original plan
within the DeepSafe project envisioned using
our proprietary FundingBox-owned matchmaking AI
platform, OnePass Bridge, to match investors and
startups automatically.
Uh, obviously We did not believe that the deals
are going to happen automatically, uh,
but the goal was to do the matchmaking
and allow startups and investors sign the
deals on the platform, uh,
using the standardized template. Uh,
the platform recently won the Alastria Blockchain Award for
the best Web3 project. So from the product
perspective, um, it's
ready to be deployed. But what we have found out,
that there is no product-market fit, uh,
because the investors, especially investors, are not ready,
uh, to use it for the
purpose of closing the deals.
So The reality is that the EU investors are
not ready for the so-called blind hype-based seed
investments. They are also distrustful of
the new legal approaches, uh,
and the so-called black box automation. So now we are pivoting this
to one-to-one model, uh, meaning
in the framework of the project, we are test
driving matchmaking the investors
also through the platform, but then taking this
on the one-to-one basis to close the deals using
the EU scale template. So we want to have
the real-life proof that the deals, the signing of the
investment agreement, can happen really, really
fast. And this is the first step that we are
right now, uh, testing.
I see that, that sounds pretty promising. You've been talking
about DeepSafe before. Can you walk us through the
structure of the DeepSafe project? Who's involved?
How decisions are made? And how founders, lawyers,
and even VCs are contributing to the EU
scale design? Yep, absolutely.
So the DeepSafe is the EU-funded initiative. Uh,
it's consortium of experts doing the work. We are rather
a small consortium of 7 partners led by FundingBox
accelerator company based in Poland.
In the consortium, we've got the Danish accelerator
called Accelerace, seed fund from
Latvia Overkill, South Moravian
Innovation Center,
BW.CON, Baden-Württemberg Connected
from Germany, and Techosystem
in Ukraine. And on top
of this, we've got a sister company from Spain, FundingBox
Communities. So that's the consortium. That
is helping us to get immersed
into the different ecosystems, different legal ecosystems in different
countries, to make the adaptations
as fitting to the legal
realities of different countries, different ecosystems.
While the European
Simple Convertible Agreement for Loan to Equity
EU Scale is the product. It's a contract template,
uh, supported by the
guidelines. And right now we are looking for
the organizations willing to join us
and help us build it together.
We want to listen to the voice of the ecosystem because
we are building this product for the
ecosystem. So if you are the lawyer, tax advisor,
VC representative, angel investor,
or experienced founder, we are opening a call for
expressions of interest to recruit for our working
groups. So you can visit our website eu-scale.eu
to register, and, uh,
we are definitely going to
to involve everybody that is willing to contribute to this
common goal that we've got in Europe.
Um, we are focused on Founders here on Startuprade.io,
so let us dive in a little bit into the Founders Playbook.
For founders listening today, admittedly we're recording this
shortly before Christmas, but it will be aired only in February
because we, we currently do have quite a backlog a
backlog in content. So for founders listening today,
say, when racing across Germany, Poland, and
Czechia, what 3 practical
steps should they take right now to prepare
for cross-border round? Well,
nowadays I think that the best approach is
get the local lead investor
and close with him a preliminary deal that he's
going to lead the round.
Then search for the international investors who like
the idea. Well, searching for investor is still the
job that you have to do as the founder. And then once
you convince them, ask them to join the round. Why
the local lead investor? To build the trust
of the foreign investors that all the legal
elements and the
basic due diligence has been done properly under
the local legislation. So
that's the approach for now. For the future, once the EUSK
will become the standard, it should be much easier because then you could
be raising money independently
for— from different investors and signing, uh,
like the American companies are doing, signing SAFEs,
each of them independently and up to some limit,
and then with the promise of converting them at the next
equity round. But we are still not
there as the ecosystem. And
I was wondering for our audience if you ever paid a lawyer to
translate a SAFE or convertible notes between EU
jurisdictions. Drop a comment where you're based and let
us know how common this is. We need to talk about
the policy context here, the so-called 28th regime and EU-INC.
Yes, the European Union has currently only 27 members, and
the 28th regime is
part of growing political momentum in Brussels, um,
a potentially new pan-European company structure that could—
would let startups incorporate once and operate
everywhere. But since this might take years to become real,
how do you see EU Scale positioning itself as the
bridge between solution founders and investors
can use today? How has
the shifting political climate influenced
you? Well, the
response coming from the
European Union, European Commission,
towards the initiative of creating the 28th
regime is very positive. EU-INC initiative
is working on it. They have even developed the EUFAST.
This is the advanced
subscription template that
is basically the US SAFE adoption in
Europe. We believe
it has still
the flaws, that we
have faced when trying to adopt American
SAFE in the current European ecosystem.
So that's why we believe that the intermediary step,
like the SCaLE, Simple Convertible Loan Agreement, is
needed. Commission recently
announced that the 28th regime is going to be
the binding regulation. That's good. It's likely to be
adopted in '27 but taken into force
late '27 or even '28. Uh,
just to remind the listeners, GDPR was also the
regulation, and there were many, many issues with the
implementation, and there is usually the transition
period allowing companies to get
time to prepare. There are different interpretations of
laws, different understanding what data protection was.
GDPR was supposed to be universal but became
very complex, and practically for the it, SMEs, uh,
it hit the small companies with the disproportionately high costs.
GDPR concept was born 15 years ago. And
very recently it got fully implemented. So, uh,
that's why we believe that on the way of
implementing the 28th regime,
there will be some hurdles. Regarding 28th
regime, there are more questions than
answers. These questions are tax residency, social
securities, labor laws. It still might
not be applicable for all companies,
especially those that were established under different
local laws. And that's why we
believe that we need that bridge solution
now. The EU scale, we believe, is something
that is going to be the intermediary step, but we
need it really now and fast in the European
ecosystem.
Guys, right after the break, we'll uncover the strategy
that changed how FundingBox scales cross-border
investments and how EU Scale could speed up
your next round by months.
Guys, welcome back from the ad break. How, Tomasz, how
do you balance national differences, say Poland versus
France, while designing one instrument that
fits everyone? It has to fit 27
legal regimes. Where do you draw the line
between flexibility and standardization?
Well, convertible loans are widely used across
Europe with relatively small differences
between countries, but
unfortunately, quite often they become bulky and too complex.
So the primary challenge that we've got is to make it— make
them simple enough to make them universal
But on the other hand, we are working on creating a
playbook set of rules on this,
how to align existing accounting practices, tax, legal
implications in different
legal setups. So
to address this, we'll develop the white paper that will
highlight the required adjustments and interpretations
and educational materials So it's like a playbook for
this, how to use this EU scale depending on the
setup. Investor coming from this country investing in the startup in
the other country.
Let's look a little bit into the future, Tomas.
If the EU scale becomes the norm,
what we currently hope for, what will Europe's early-stage
funding landscape look like somewhere around
2028? Will we finally see a true pan-European
seed, pre-seed market? We hope
so. That's our goal and that's our mission. You, you
guys are also working
with DeepSafe. When is your next intake of
DeepSafe for startups and investors, and can you
explain the benefits for both?
Well, we expect to to launch the next cohort for
about 20 startups in, in late February
'26, with the deadline for applications
being in April. April. In So
after onboarding those 20 startups, we are going to
support them with the Venture Readiness Program starting from
May. We offer them the mentoring
But also we are going to include the fundraising and
actionable advices on how to use the EU Scale
instrument. Moreover, we are going to offer
also the warm introduction to investors
that are in our ecosystem. And we
are looking for the high potential early stage startups
active in the deep tech domain.,
established in the EU member states or Ukraine, uh,
and we are looking for startups that are interested
in piloting the EU Scale convertible, uh,
deals. And obviously the expression of
interest will be launched at the eu-scale.eu, so we are
inviting all the startups to
mark this website and look for
announcement of the open call in February.
Um, your predictions for 2030—
what is your boldest prediction for Europe's deep
tech ecosystem by 2030 in talent,
capitals, and exits?
Well, we believe that, um, the
gap between EU and
US and China will be minimized. Our goal
is to reverse the trend, and we
believe that reversing the trend, meaning that the gap is not
growing and getting smaller, is going to be a success.
I would also be interested in your contrarian take.
Many say Europe can't compete with the US. Um,
I actually just read the, uh, State of
European Tech from Atomikor. They say something different.
Um, but, um, you've argued that Europe's
fragmentation might be actually its secret
weapon. How so? Well,
nowadays we definitely
cannot compete in the volume and speed of investments.
Not today and probably not in the
short future. But, and here
are a couple of buts, we
believe that the united defragmentation under the EU umbrella
The fragmentation of the market, um,
is giving a huge opportunity because
Europe has the largest public grant
ecosystem in the world. That is including
grants on the different levels, including the
cascade funding grants where we as FundingBox, for example,
are one of the European leaders of distributing the cascade funding
grants. Just to remind the audience, we have distributed and supported,
uh, more than 1,500
startups in the last couple of years.
On top of this, well, Europe has the, uh, complex but
more stable and predictable political and regulatory environment.
Still lower costs of accessing talent, for example, from CEE
or Ukraine, and Just to mention,
numerous technology and competence centers, uh,
that hold untapped advantages.
Once fully unlocked, they could
significantly strengthen the deep tech ecosystem.
So Europe may not be the most competitive now, but
it's likely the most steady market. We believe that all those elements
are the counterarguments that Europe
will not be able to compete with the US and China. And
we believe that the defragmentation is the key
to unlock all those opportunities.
Um, for our audience, if you're a founder or investor in Europe,
we would be interested give us a comment of your country
pair, the two markets you're trying to bridge with funding,
say Germany, Poland. We'll highlight some of your cases in future
episodes. Tomas, you have
any advice for founders? Because looking back to your
first startup days and your early investor experience,
what two things would you do differently today?
And what should founders focus on when raising
cross-border? Well.
Back then there was literally no VC
ecosystem in Poland, so we had to bootstrap.
Due to the lack of capital,
we got stuck in Poland. We simply didn't have the capacity to go beyond.
So nowadays I would raise
funds from, from abroad and start
scaling from day one with the global mindset.
Today, the mindset should be global and
not local, not even regional, from day one. And
only those companies have the chance to be a
true success, uh,
the founders that are born with the global
mindset and go with this
setup, uh, of conquering the world.
That's the only way forward in my view nowadays.
Let's talk about a hidden gem as the last
question. What's one little-known legal or tax
tip every European founder should know before
signing the next term sheet?
Well, I guess there are many, many tips and tricks.
I believe that founders should
be really careful when
making— signing their first investment agreement.
I would say, first of all, conduct the
due diligence of your future investor.
Investment agreement, especially at the very early stage, is the
long-term contract. So be sure
with whom you are onboarding
on your mission. More
practical things: do not make any guarantees on your personal
property. Still, such elements are
happening from time to time. And
this can potentially lead to a lot of
tensions and a lot of unnecessary pressure on
the founder. Early-stage deals,
it's known to everybody that are very risky
and then can often fail. So you as the founder
shouldn't be putting more pressure on yourself than needed.
And The last thing, quite obvious,
but unfortunately still too often
overlooked: do not give away a large
portion of your equity for the seed investment. We have seen
so many broken cap tables that companies became uninvestable,
and it's a big pity. Tomasz.
Awesome closing words. Thank you very much. It was a pleasure having you as a
guest. Thank you, Joe. It was also a pleasure
having me with you.
That's all, folks. Find more news, streams,
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