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Why haven’t European investors fully accepted the failure is good mentality yet?

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Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#31

Post by gnerd »

logicallee wrote: post #19
H4U wrote: post #16

As a brit we do not fear failiure, its well known that Up to one fifth of the 400000 businesses that start up each year fail within the first 12 months of operation in the UK. investors dont write blank cheques is the main difference. we are blunt and dont flower up potential so monetry failiure is more relative to business size.

>we are blunt and dont flower up potential This nails it. You're not going to even investigate potential - your investors don't have that kind of vision (or interest). Not a snowball's chance in Hell a Brit VC would have acted as Peter Thiel did when he came on board with Facebook. Because that would have been "flowering up potential". Or as I like to call it, vision.

I find it interesting in a thread about failure you are going to use an example of highly improbable success to highlight what you call vision.

That is a cool anecdote and all but it smells like confirmation bias. I'm sure the one guy who won the lottery yesterday had a vision too. Maybe I'll have a vision tomorrow when I play a slot machine or maybe I'll have whatever-its-called when you dump a bunch of money on a long shot and it doesn't come through (were there no visionaries to see the social graph for myspace and friendster?). There's a line somewhere where a can-do attitude becomes naive and the other side of it is where practical sensibilities become choking to fresh ideas, right now I feel we are in a place where having a go is a good thing but it won't always be that way (at least in our industry).

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#32

Post by Athas »

RivieraKid wrote: post #30

I would hypothesise that there are two reasons for this. 1. The size of the US market is a huge advantage. Startups targeting and operating in the US market can grow bigger. China has the same advantage. 2. Americans are less risk-averse because Americans are mostly descendants of immigrants. And immigrants are more likely to have a less risk-averse DNA.

> 2. Americans are less risk-averse because Americans are mostly descendants of immigrants. And immigrants are more likely to have a less risk-averse DNA.

Do you have any evidence that this is a genetic trait, and not a cultural factor? I have never heard this postulated before, but it would certainly be interesting if true.

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#33

Post by raverbashing »

"As European talent in the form of startups and entrepreneurs continue to flock towards the USA, the question remains: why? Is it attitude or is it money? Is it bureaucracy or is it poor infrastructure?"

This is a loaded assertion. And, sincerely very cliché.

Oh Europe is bureaucratic and expensive? And yet there's nothing like this: http://en.wikipedia.org/wiki/Giro in the US. Ridiculous

Funny how several of these big US companies open offices in Dublin (offices, not merely a mailbox and a shell company) guess they didn't get the memo.

Cell phone plans are way cheaper in Europe (no paying to receive calls).

Overall quality of life in bigger European cities, mass transit is ubiquitous.

So, in overall, I think the US has a lot to learn from Europe. But I understand, while in the US people think "Why not, let's do it!" in Europe people think "What can go wrong"

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#35

Post by RivieraKid »

Athas wrote: post #32
RivieraKid wrote: post #30

I would hypothesise that there are two reasons for this. 1. The size of the US market is a huge advantage. Startups targeting and operating in the US market can grow bigger. China has the same advantage. 2. Americans are less risk-averse because Americans are mostly descendants of immigrants. And immigrants are more likely to have a less risk-averse DNA.

> 2. Americans are less risk-averse because Americans are mostly descendants of immigrants. And immigrants are more likely to have a less risk-averse DNA. Do you have any evidence that this is a genetic trait, and not a cultural factor? I have never heard this postulated before, but it would certainly be interesting if true.

No, this is just an idea that occured to me a long time ago in school, it may be completely wrong.

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#36

Post by Hermel »

RivieraKid wrote: post #30

I would hypothesise that there are two reasons for this. 1. The size of the US market is a huge advantage. Startups targeting and operating in the US market can grow bigger. China has the same advantage. 2. Americans are less risk-averse because Americans are mostly descendants of immigrants. And immigrants are more likely to have a less risk-averse DNA.

3. The opportunity costs of failing are higher in Europe. Thanks to welfare and lots of vacation, the founders of a startup have to sacrifice much more leisure time vs. the alternative (working at an existing corporation). For the same reason, it is also harder to find risk-seeking employees. They prefer doing financially ok with lots of leisure time over having the chance of getting rich without leisure. In the US, they don't have much holiday in either scenario.

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#37

Post by ThomPete »

cromulent wrote: post #12
ThomPete wrote: post #8

Earlier quoted context omitted.

It's pretty well established though. Check out this article. http://www.economist.com/node/21559618

I disagree. If you compare Europe and US, I think there are hotbeds in each one. However, the articles seem to compare Europe with Silicon Valley / San Francisco, which is silly. Obviously San Francisco is special, even within the US. Edit: Also, the Economist article doesn't address Europeans having a fear of failure.

There are hotbeds but Europe have far less success stories than the US and therefore you have as I explained further up the risk-averseness of the european investors.

At least those that I know, and I do know quite a lot.

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#38

Post by troels »

k-mcgrady wrote: post #22
ThomPete wrote: post #11

Earlier quoted context omitted.

Yeah good luck building a startup in europe with that view. There is a reason why ex. Facbook localized their content.

I's a strategy for getting the business going. Obviously you begin localising once you've got some traction.

No, you need localisation to get traction. People are surprisingly fond of their own language, even if they are almost fluent in English. At least if you're dealing with consumers.

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#39

Post by ThomPete »

raverbashing wrote: post #33

"As European talent in the form of startups and entrepreneurs continue to flock towards the USA, the question remains: why? Is it attitude or is it money? Is it bureaucracy or is it poor infrastructure?" This is a loaded assertion. And, sincerely very cliché. Oh Europe is bureaucratic and expensive? And yet there's nothing like this: http://en.wikipedia.org/wiki/Giro in the US. Ridiculous Funny how several of these b…

That has absolutely nothing to do with why European investors are more risk-averse (they are).

Re: Why haven’t European investors fully accepted the failure is good mentality yet?

#40

Post by ThomPete »

michaelochurch wrote: post #15

Snarky but true answer: failure is not always good. Look, I'm all for removing the social penalties to good-faith failure. I've failed before (in good faith) and I'm a good guy. Some problems are harder than they look, and sometimes the solution is brilliant but no one wants it. However, I can't share that cavalier attitude toward failure that I often encounter in the HN-sphere. I would love to see society become mor…

Oh there is failure in Europe too it's just that a lot of it is based on loans so many of the people who fail have no way to "try again"
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