Lewin Bunz, co-founder of Calibration Capital, says engineers matter more than ever for building large start-ups, and that finding them has become harder but more important in the AI era.
OpenAI and Anthropic paid large sums per engineer in top acqui-hire deals over the last 12 months for companies with no revenue yet, making the market for engineers binary as every company chases a few top people.
Bunz says the last nine months have been euphoric with capital sometimes misallocated, and expects the hype to expose where AI does not work, while calling the Adobe scare overblown since customers rarely leave tools like Photoshop or InDesign.
Berlin fund bets engineers decide which startups get big
Calibration Capital is a Berlin fund built on the bet that engineers decide which startups become large. In the AI era the best engineers are scarce and priced like footballers, so founders spend most of their time hiring. Helping them find engineers is therefore the fund's first job.
Takeaways
Engineers are now the scarce input for startups. Calibration's thesis is that engineers matter more than ever for building large startups. The best ideas are worth nothing if founders cannot bring the right people to the table. Finding talent has become harder in the AI era and also more important.
The engineer market has become binary. In the last 12 months OpenAI and Anthropic paid large sums per engineer in acqui-hires of companies with no revenue. The gap between good and very good engineers is widening, and every company chases the same few top people.
Top founders spend over half their time hiring. The best founders now spend over half their time on hiring, leadership and org building. In Europe they compete for talent with OpenAI, Anthropic, Palantir and Legora, which grew very large within three to four years.
Tech Europe feeds Calibration's talent pipeline. Co-founder Bela Wirts runs Tech Europe, with about 25 hackathons a year, a newsletter and an AI conference. It introduces Calibration to talented people without clear career paths who fit companies in Berlin, Munich and London.
CVs are a poor guide to founder success. Bunz was deal lead on Canva at Global Founders Capital, which invested before revenue. Founders Melanie Perkins and Cliff Obrecht looked unlikely on paper to build a mega company. Most people who built large companies are not McKinsey partners.
Themes popular with LPs are usually too late. Bunz sees defence still offering companies, but names space, photonics, consumer and energy as places for the next large European company. The best cybersecurity bets were probably made years ago. AI sales cycles have shrunk.
Euphoria will expose where AI does not work. Bunz calls the last nine months euphoric, with capital sometimes misallocated. He expects far more engineers within five years and pay detached from years of experience. He thinks the Adobe scare is overblown, though software multiples may shrink.
Advice for founders and engineers
Ambitious engineers can reach Calibration through Tech Europe hackathons or by writing directly to Bunz or Wirts.
Founders should hire earlier and look across Europe, including people with unusual backgrounds.
Founders learn hiring by doing it and by talking to other founders. Those who think they hire well still need to be better to build a very large company.
Tap a name to go there · tap a line to see why they are linked
On this episode 2
Show 1
Founders should build and see where it leads rather than over-analyse. Building a very large company requires going to the USA.