Donald Trump’s White House return is already changing the shape of the US tech scene. With the CEOs of some of the world’s biggest tech companies on-side, he’s promised a $500bn AI infrastructure project dubbed “Stargate”, backed by the likes of OpenAI and SoftBank, aimed at building data centres across the country and creating thousands of new jobs.
But the new administration is already influencing companies’ decision making abroad, too. Earlier this month, crypto and defence tech startups told Sifted they were deepening ties with the US, applauding Trump’s push for deregulation and hoping his administration will open up more government contracts.
Others voiced fears that Trump’s proposed tariffs on EU exports to the US could hit their businesses hard, forcing them to consider changing suppliers or relocating.
Sifted broke down a list of the key roles in Trump’s new cabinet who European founders should keep their eye on, and how their priorities might impact startups. Many of Trump’s picks have yet to be made official, and this list will be updated as more appointees are confirmed.
Secretary of Defence — Pete Hegseth
Pete Hegseth, a former Fox News host and Army veteran, will be a key role to watch for European defence tech startups and VCs. A controversial nominee, Hegseth has faced allegations of sexual assault and excessive drinking. Ultimately he secured a narrow victory, with the deciding vote to confirm his appointment cast by Vice President JD Vance.
The Secretary of Defence is responsible for things like policy, resource management and programme evaluation, overseeing the Pentagon’s roughly $850bn proposed budget.
Hegseth has been very critical of NATO, calling it a “relic”. In a book published several years ago, Hegseth wrote that “Europe has already allowed itself to be invaded. It chose not to rebuild its militaries, happily suckling off the teat of America’s willingness to actually fight and win wars”; and that the “defense of Europe is not our problem; been there, done that, twice”.
Based on Hegseth’s NATO rhetoric — and President Trump’s comments about wanting European countries to up their spend on defence, at one point saying that Russia should invade any under-paying NATO nation — the US looks set to be a less reliable ally.
That’s worried some VCs, who believe the new administration may therefore be less beneficial for European defence techs. “Hopefully European [ministries of defence] set new procurement regulations to encourage more contracts” for European startups, Paris-based VC Michael Jackson told Sifted in November, but the new administration “might also mean fewer contracts to non-US companies in the defence space as US policy becomes more protectionist”.
However, others view Hegseth’s criticisms of the Pentagon for trying to “block new technologies” as a sign that startups may have more of a shot in the defence industry as a result, as Sifted reported. Hegseth also emphasised the need to ramp up weapons development via increased competition. Some believe European startups could benefit from this as well, if they are able to deepen their ties to the States — or even move there.
AI and crypto Czar — David Sacks
Trump appointed former PayPal exec and Craft Ventures investor David Sacks as the “White House AI and Crypto Czar”, a role in which Sacks will guide policy in AI and crypto for the Trump administration.
He will “work on a legal framework so the crypto industry has the clarity it has been asking for, and can thrive in the US,” as President Trump wrote on social media announcing the appointment in December. Sacks will also lead the Presidential Council of Advisors for Science and Technology.
Sacks’s purview will include helping develop an “AI Action Plan” to promote American AI. The Trump administration has been working to break down controls on AI development, revoking an executive order put in place by former President Joe Biden on AI safety and security.
Silicon Valley’s Sacks has voiced pro-crypto stances, including recently calling non-fungible tokens (NFTs) and memecoins “collectibles” instead of securities (which would subject them to more regulation).
Some investors and industry insiders are encouraged by the appointments so far: “If you look at the people surrounding Trump that are advising him on the tech side, the majority of them, if not all of them, are pro-crypto,” Sep Alavi, head of digital assets at VC firm White Star Capital, recently told Sifted.
Head of the Department of Government Efficiency — Elon Musk
Europe’s crypto and fintech startups are likely to be keeping a keen eye on Elon Musk’s plans to involve digital assets and blockchain technology in the Trump administration. The billionaire businessman was one of Trump’s key proponents during the election trail and contributed $277m to support his re-election campaign.
Following Trump’s victory, Musk was appointed to lead the newly created Department of Government Efficiency, nicknamed DOGE in a nod to the meme and cryptocurrency, and will be tasked with reducing government spending and regulations.
One of the ways Musk plans to do that is by utilising blockchain technology to track federal spending, secure data, make payments and even manage buildings, according to a Bloomberg report. Musk has also discussed using digital ledgers — a database that records transactions or data entries and is the foundational system underpinning blockchain technology — as a way to cut costs out of the government.
Musk’s intention to further integrate blockchain technology into governmental affairs is a further signal to Europe’s crypto startups that the Trump administration will be pro-digital assets and may further encourage companies to relocate or expand efforts stateside. Last Thursday, the new president signed an executive order designed to “strengthen American leadership” in cryptocurrencies, which prompted US VC firm a16z to close its London office to focus on the US crypto market.
DOGE itself doesn’t have the direct authority to enact these changes, and can only make recommendations to Congress or the White House. But that hasn’t stopped some European tech leaders from calling on EU lawmakers to adopt DOGE’s deregulatory agenda. Earlier this month, Sifted spoke to several European founders and investors who voiced support for a form of “DOGE for Europe”.
Senior policy advisor for AI — Sriram Krishnan
Former Andreessen Horowitz partner Sriram Krishnan was a key player in European tech until he stepped down as the head of the American venture capital firm’s now-shuttered UK office in July last year. Previously, Krishnan was on the board of directors for virtual events platform Hopin until he resigned from the board in January 2024, according to Companies House filings.
He’s since been appointed as senior policy advisor for AI at the White House Office of Science and Technology Policy. And while it’s not clear yet what this role will entail, looking at his past investments and comments on AI offer a clue.
“Large internet sites are fighting back against AI models with the internet equivalent of raising the castle drawbridge,” he said in a New York Times opinion piece last year, regarding user protests on social media sites Reddit and Stack Exchange and how they license data to AI models. “Some industry experts believe the answers are in legal action and older sites forming content alliances. As a technologist, my hope is that the answers lie in code rather than lawyers and that we see creative technology solutions to help keep the internet open.”
In an interview with Sifted last year, Krishnan waxed lyrical about UK AI startup and a16z portfolio company Gensyn.
“They’re working on a kind of technology where everybody can help train the next generation of models and participate and be incentivised for it in a very, very fascinating way,” he said.
Read the orginal article: https://sifted.eu/articles/trump-administration-picks-matter-most-european-tech/
