Every time I see a small LM or encoder-only initiatives, my first guess is that they must from Europe. honestly that's fine, it's way more credible than some eu AI companies claiming frontier this and frontier that on LLMs to get eu/gov funding while they're really just post-training Chinese open weights. The problem of SLM startups is scaling and fundraising: the SLM story is hard to sell in the EU because the VCs there lack the knowledge (or still dreaming about AI sovereignty), and also hard to sell in the US because VCs want to throw money at categories with huge upside and get that compounding effects. imo, the upside of SLMs is upperbounded to, say, dev tools? meaning the best SLM can probably be a pretty smart dev tools, and when compounding with some network effect it can be cool, but it's still nowhere near the LLM story and its upside.