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Y Combinator’s European founder intake continues to grow

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Re: Y Combinator’s European founder intake continues to grow

#171
post #82

In my experience (Belgian guy that dabbled a bit with EU VCs for my SaaS) Europe is very risk-adverse, and you either have to give up ridiculous amounts of equity for a little amount (i.e. 50k€ for a 25% to +50% stake) when not established yet, or have a recurring revenue of at least 50k€/month to get reasonable propositions. Also, European culture is slightly different: most people consider a startup failure as some…

> Also, European culture is slightly different: most people consider a startup failure as something bad that you drag along for the rest of your career.

This is a major issue in Japan too AFAIK. Working for a big corporation or the government is still considered superior to entrepreneurship, and failing at a company brings a lot of shame.

Without permission to fail, it's impossible to succeed. As Elon Musk put it: "we're gonna have to blow up some rockets."

I've wondered if the most significant innovation of the past 500 years and the one that led to our historic technological and economic explosion of progress wasn't just limited liability companies.

In the past to do anything big you had to either be already rich (vastly limiting the pool), find a patron (again a small pool), or borrow money. In the old days borrowing was basically loan sharking. You'd end in prison, dead, or at best shamed and broken for the rest of your life if you failed to repay with interest.

All that meant very few people could take risks, so very little innovation.

Limited liability allows vastly more people to take risks. Yes it does lead to abuse, fraud, and waste, but it also leads to a huge amount of innovation since people have permission to take risks and fail and then recover.

Failure at something like a startup still comes with costs. If you (the founder) are not a narcissist or a psychopath it will probably come with emotional costs like a feeling of failure and a feeling of having let people down. But it doesn't ruin your life, blackball you from your career, or land you in prison.

Re: Y Combinator’s European founder intake continues to grow

#172
post #116

I am an American founder that accidentally built a company in Europe. I hired my first person there, and through the path of least resistance, most of our 45 person team is based in Europe. I believe I am playing 'business' on easy mode compared to European founders. As an American founder it's pretty easy for my US company to pay my European team as contractors. European founders have to comply with European employm…

As a European founder you can do exactly the same. You can hire contractors in Europe and won't have to pay employer taxes, mandatory PTO...

I don't think there is any difference if your company is in the US or Europe. In both cases however you have to be careful that your contractors don't get reclassified as permanent employees if you hire them for too long (more than 2 years in a row and 40 hours a week is risky).

Re: Y Combinator’s European founder intake continues to grow

#174

Earlier quoted context omitted.

Europe’s lack of competitiveness in tech has been true pretty much since the birth of Silicon Valley. It was the same with the PC business back in the 80s and 90s. Here’s an article from the New York Times in 1996, struggling to understand why European PC manufacturers were all failing to expand outside their home markets: https://www.nytimes.com/1996/10/07/business/why-european-com... 25 years later, the story is th…

The challenge with any argument about SV vs Europe is that SV is so sui generis that it's actually SV vs more or less everywhere else including the rest of the US. Really, including the rest of California. What's the startup ecosystem look like in Fresno? SV is so atypical that it's almost impossible to draw any kind of conclusions from particular factors and anyway is now probably self sustaining - VCs go there beca…

> and anyway is now probably self sustaining

As a German this is an interesting point.

While I'm no big fan of the big cities (Berlin, Munich, Hamburg) we see lots of successful* startups happening and gaining track there and in smaller towns.

University cities are often doing fine, too and are slowly but surely developing startup structures and everything else.

To me this looks more promising than concentrating all startups and money in one place and measuring everything against that.

Re: Y Combinator’s European founder intake continues to grow

#175

Earlier quoted context omitted.

>failed to create an internationally relevant social media company Those are pros or cons? >Tech salaries in Europe are now just 1/5th of what they are in Silicon Valley. Are SV salaries 5 times higher than in Zurich or London? seriously? or you're talking about peak of peak of peak?

If we’re talking Zurich specifically, the difference would probably only be 2-3X less than FANMAG/ETC. London salaries are high too (not Zurich levels from what I’ve seen), but that market is now separate from the EU. But most places in Europe with tech scenes and outsized VC investment, eg. helsinki, stockholm, berlin, amsterdam, etc you’re talking 5X less salary than in Silicon Valley. Given the tech talent in thos…

Is it fair to compare salaries in one specific place in USA versus the average European city ? Seems like you are comparing max salary in USA vs average salary in Europe.

Seems fair to consider max salary in Europe when comparing with SV.

There should also be arbitrage opportunities for cities outside of SV in USA.

Re: Y Combinator’s European founder intake continues to grow

#176
post #154
post #116

I am an American founder that accidentally built a company in Europe. I hired my first person there, and through the path of least resistance, most of our 45 person team is based in Europe. I believe I am playing 'business' on easy mode compared to European founders. As an American founder it's pretty easy for my US company to pay my European team as contractors. European founders have to comply with European employm…

You're cheating the system, though. The system exists in order to support the way of life in these countries, by bringing your American employment attitudes to Europe you're not really building a company in Europe by any measure: you're building an American company. Your company is benefitting from the robust systems in Europe, without contributing. There are people you want to hire in Europe _because of people payin…

I strongly disagree with your point, but it is well-articulated and I also felt the need to upvote given the LISP syntax.

Re: Y Combinator’s European founder intake continues to grow

#177

It's definitely good to see a strong increase in entrepreneurship in Europe, though I do wonder whether the Y Combinator program can keep up its quality and value-add as they themselves scale up. It's one thing to have weekly sessions with experienced leaders like PG and others, and a small enough cohort whereby you can swap stories and learn as you progress through the program. On an industrial scale though, you los…

The weekly video sessions that StartupSchool offers are great. I participated in them during the first batch when they were led by YC alumns (I think now they're just self-organized), they basically just consist of people taking turns telling the group what they did last week and what they plan to do this week. In retrospect it was really great thing and helped me enormously to focus and make progress. Especially as…

I think something guy cut off. Aren't all these videos available online still as part of the startup school material?

Re: Y Combinator’s European founder intake continues to grow

#178
post #156

Earlier quoted context omitted.

> Every card was stacked against me Considering the insane amount of funds France will literally gift you just for opening a startup there, I find that very surprising. You have to be good at paper pushing and speak the language however. That much is true.

Yeah, my French is not what it should have been and I contracted an allergy to the French bureaucracy. Quite a bit of the whole thing is on me, no denying that. A good friend is doing it now and it's not like he's swimming in cash though.

Yeah, to do any business in France, your really need to speak French. The French bureaucracy is not that bad (when you compare it to some of its neighbour) but in the same vein, it will be impossible to deal with it if you don't have a good grasp of French.

France cares a lot about French and its honestly an issue many time (and I say this as a French person). Things are changing slowly, but anybody serious about moving / opening a business in France should be serious about learning French. You would be astonished by the number of engineer, investor, and in general any business person, who have an awful level in any other language than French...

Re: Y Combinator’s European founder intake continues to grow

#179
post #116

I am an American founder that accidentally built a company in Europe. I hired my first person there, and through the path of least resistance, most of our 45 person team is based in Europe. I believe I am playing 'business' on easy mode compared to European founders. As an American founder it's pretty easy for my US company to pay my European team as contractors. European founders have to comply with European employm…

> European founders have to comply with European employment law.

There's got to be a better way. By default or by design, the different rules in USA and EU both advantage larger companies, thwart smaller companies.

To encourage small businesses and new business formation, we must synthesize the good parts of USA's (former) entrepreneurial spirit and EU's labor protections.

Universal healthcare and German-style childcare would be huge boons for USA's startups and small businesses. Maybe reverse the decades long decline.

Something like UBI coupled with looser labor laws (easier to fire, layoff) could allow EU startups to be more nimble, more competitive.

Re: Y Combinator’s European founder intake continues to grow

#180
post #177

Earlier quoted context omitted.

The weekly video sessions that StartupSchool offers are great. I participated in them during the first batch when they were led by YC alumns (I think now they're just self-organized), they basically just consist of people taking turns telling the group what they did last week and what they plan to do this week. In retrospect it was really great thing and helped me enormously to focus and make progress. Especially as…

I think something guy cut off. Aren't all these videos available online still as part of the startup school material?

Ah my mistake, I originally though they discontinued these but actually they still exist, albeit without being led by YC alumns (I think).
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