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Why Is Europe Failing to Create More $1B Startups?

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Re: Why Is Europe Failing to Create More $1B Startups?

#271

Post by ThomPete »

brooklyndavs wrote: post #268

I think asking this question without addressing the overall cost/benefit to society is not very productive. The overall goal, I think, is to allow startups to grow and thrive while at the same time being a net plus for society. I would argue that "ask for permission later" mentality of some US based startups is a net minus to society overall. While I don't have any love for the taxi industry the regulations around ca…

I don't disagree with a word you are saying but I don't think I was implying that you shouldn't do cost benefit. It just wasn't what the article was trying to explore. I am saying both in the beginning and the end that I am not even sure it make sense to focus on unicorns for Europe.

But given it's importance on many things after all I wanted to understand why Europe didn't have more than they do.

Re: Why Is Europe Failing to Create More $1B Startups?

#272

Post by Cadsby »

hodwik wrote: post #141
robwilliams wrote: post #82

Earlier quoted context omitted.

>10 smaller companies might be better than 1 big company. 100 companies worth $10 million dollars each might provide the same number of jobs and the same services to the economy. I'm not sure what point you're trying to make. It's beneficial that Airbnb is so big because I can plan a cross-continent vacation using one website instead of searching for each city's/country's version of it (which may have poor customer s…

Thank you. The knee-jerk belief that small business is always better is profoundly un-historical. Most of the greatest inventions of the past 100 years have come from large businesses that had the man-power and capital to invest in significant R&D departments. Like I said below; AMD and Intel have a duopoly on x86 processors and have for ages. Intel's profit margins waver between 1/4 and 1/3 of revenue. Simultaneousl…

> Most of the greatest inventions of the past 100 years have come from large businesses that had the man-power and capital to invest in significant R&D departments.

Your narrative leaves out the huge sums of public dollars that underpinned those innovations.

Re: Why Is Europe Failing to Create More $1B Startups?

#273

Post by s73v3r »

bitL wrote: post #144
s73v3r wrote: post #110

Earlier quoted context omitted.

"and you can't sign away most of your rights if necessary for company survival. " I don't believe for a second that someone signing away their rights is necessary for company survival. Maybe you as a company leader need to do a better job so you don't come to that point, and if you have, then maybe you aren't fit to run a company.

This doesn't have anything to do with my preferences; frankly I am disgusted by it, but it's a common practice in the US to sign away the rights if you want to get funded by many VCs. So those VCs obviously prefer US as they can't (if "necessary") do the same shady moves in Europe (yet).

I assume he was talking about worker's rights.

Re: Why Is Europe Failing to Create More $1B Startups?

#274

Post by seibelj »

exelius wrote: post #178
happyscrappy wrote: post #161

Earlier quoted context omitted.

>The major two exceptions are New York and Texas in that order. Umm. Boston(MA)?

Boston is a second-tier startup city along with Pittsburgh, Chicago, Seattle, etc. It's too expensive, it's hard to recruit good talent (too cold, too far from everywhere, etc), and there's not a ton of VC. You can do it, but you'll have an easier time of it in NYC or Texas. Texas has a warm climate, cheap housing and low taxes, which draws a lot of startups there. Raising money can be a problem, but you also don't n…

It's cool that you like Texas and all but the stats speak for themselves. It's SV way ahead of Boston which is a little ahead of NYC. And Boston has tons of enterprise VC which is unique. I have no problem hiring talent in Boston, and the numbers I snag engineers for are high, but nothing like the "500k salary and 2 million in stock" articles I hear about happening in SV.

Also, the whole argument that it's harder to raise money if you are in [insert any place except Silicon Valley] is suspect. My company raised money from investors in Boston, SV, and overseas, as investors were most concerned with our business, not where we were located.

As long as you can hire good talent and have a solid business, you won't have trouble raising money as long as you can jump on a plane. The issue is when you are chasing dollars for a failing business, or have no revenue.

Re: Why Is Europe Failing to Create More $1B Startups?

#275

Post by unabst »

If these valuations are based on funding rounds, then aren't they the direct consequence of VC funding and VC math? If this is the case, then More VCs should equal More Unicorns, because they are the one's creating them.

If EU vs US VC funding is about 1:8, then the ratio correlates with the output of unicorns. If is even less, then that would imply EU actually may be outperforming the US in unicorn output per VC head. As it turns out, the EU numbers are booming this year, so it's tough to compare, but the numbers do seem to back this somewhat [0] [1].

--

[0] http://blogs.wsj.com/briefly/2015/04/27/european-vc-investme...

[1] https://www.cbinsights.com/research-venture-capital-q1-2015

Re: Why Is Europe Failing to Create More $1B Startups?

#276

Post by s73v3r »

Cthulhu_ wrote: post #24
veb wrote: post #2

Awesome read, but you write that Europe has no SV or NYC. I'd say that it does have a NYC: London. London is the centre of finance in Europe. It utterly dominates.

Plus I don't think location really matters that much; startups don't need an environment with thousands of hip enterpreneurs, all it takes is a small team with a good idea.

They don't need it, but it's much easier to build that team somewhere with that environment.

Re: Why Is Europe Failing to Create More $1B Startups?

#277

Post by e5india »

happyscrappy wrote: post #161
e5india wrote: post #145

There are a couple things missing from this article that really need to be fleshed out: 1. You're comparing the unicorns which is like comparing the top of the pyramid without measuring the base. In other words, where are the figures for seed-round startups? What is the amount of capital available to startups at the different stages in the business life cycle? Without those numbers we can't really tell if this is a m…

>The major two exceptions are New York and Texas in that order. Umm. Boston(MA)?

I stand corrected on Boston! I'm in SF so maybe I'm showing my lack of awareness a bit here. I'll definitely be paying more attention to Boston. Thanks for the correction.

Re: Why Is Europe Failing to Create More $1B Startups?

#278

Post by kuschku »

noelsusman wrote: post #249
KaiserPro wrote: post #160

Earlier quoted context omitted.

There is one currency, there are no import taxes, VAT is per country. (assuming EEC) This ofcourse assume that you are operating in one country and providing goods to another. Employment is another issue. Thats almost the same as in the US(excluding employment). The issue of low taxes is frankly utter bollocks, yes the US's taxes might be lower but so is your life expectancy, and productivity. The main issue with sta…

There's still a much larger difference in both laws and culture between European countires than between American states. Also, much of what you said doesn't make much sense. Lower life expectancy and productivity? Are you arguing that investing in startups is irrational and Europeans realize this while Americans don't?

Investing in startups is irrational, just like investing into the housing market in 2005 was. Or like investing in any bubble, really.

When companies get funding of millions without actually having anything, then it’s a bubble that will burst.

Re: Why Is Europe Failing to Create More $1B Startups?

#279

Post by kuschku »

olavgg wrote: post #118
donkeyd wrote: post #31

I've posted this before, but since I think it's relevant here: People seem to forget that Europe is not a country. Europe does not have a single uniting language. What happens, is that every country starts their own smaller versions and they stay mostly within that country. If they want to move to another country, there's often already a major player there, and they might not have the means to kick them out. I think…

I absolutely agree with you. Currently I have a business where I import used computer and network components from US and sell them in the Norwegian market. (I can import pallets of equipment for less than what the total cost is for local shipping in Norway). While I do make some money on it, the market in Norway is so small that its just a few sales every week. But it's fun, and I'm learning a lot so I still think it…

And that’s why Germany has it so easy: DHL makes shipping out of Germany or to Germany insanely cheap, DB Schenker ships per rail even from Norway whole containers cheaply, etc.

Germany has here the advantage of a low valued currency, extremely well done infrastructure, good interconnection, and easy access to other markets. Same with BeNeLux, France and Italy. In some regards, even Spain.

Re: Why Is Europe Failing to Create More $1B Startups?

#280

Post by jessaustin »

humanrebar wrote: post #155
e5india wrote: post #145

There are a couple things missing from this article that really need to be fleshed out: 1. You're comparing the unicorns which is like comparing the top of the pyramid without measuring the base. In other words, where are the figures for seed-round startups? What is the amount of capital available to startups at the different stages in the business life cycle? Without those numbers we can't really tell if this is a m…

> we don't care if the tech sector concentrates in California or Texas or wherever as long as it is in the US Hmmm... I'm not sure that's true. For some definition of "we", it would be tautologically true, I guess. Many states complain about paying more in taxes than they get back in spending. California, Texas, and New York all pay more in taxes than they get back in spending, though Delaware takes the biggest hit,…

...Delaware takes the biggest hit, per capita

Does this have anything to do with the fact that many many companies are incorporated in Delaware but don't do much business there? It seems possible that the federal taxes paid by such companies are counted as being "from Delaware" even though they mostly aren't, really.

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