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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?

#61

Post by Silhouette »

michaelfeathers wrote: post #59
Silhouette wrote: post #48

How about because "failure is good" is an absurd proposition? Failure in this case typically means people lost money and jobs. It also means customers probably got stung buying into something new and that could make them more hesitant to buy into something new next time, which is harmful to successful innovation. Learning from failures is good, and might help entrepreneurs to develop a more viable proposition if they…

Maybe the way to put it is - "failure is not something to be that scared of." I didn't like the article. It felt shallow. The real issue is that in the US we have a tendency to not second-guess people's decisions about how to invest their money. Yes, this means that some people will be ripped off, but it also means that they, and the society as a whole can be in rapid learning cycles about what makes a good investmen…

It's clear that the US has a very different take on acceptable risk and as a result they more big wins and big losses. Can't have one without the other.

Is that really true? If you ever make a big loss, in the sense that backing something like Google or Facebook would have been a big win, you're probably doing investment wrong. The dominant US tech investment strategy today appears to be accepting many relatively small losses on the basis that one smash hit will outweigh them all.

I've noticed that in US-centric discussions, the distinction often seems to be stated in terms of "risk-aversion", with a focus on how much downside is acceptable and how US investors tend to accept more risk. In discussions on this side of the pond, we might rather distinguish based on "expected returns", with a focus on how much upside is likely across all outcomes and an emphasis on the mean rather than modal return.

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

#62

Post by shin_lao »

PakG1 wrote: post #18

To desire failure, this probably means you are trying to do something new. Below I am speaking purely on conjecture, no real sound theory. I get the distinct impression that Europe cares more about tradition and therefore less about disruption. As such, there is not as big a desire to try something new, and therefore no reason to consider whether failure is good. In fact, if the emphasis is on tradition, failure is f…

How many countries in Europe have you visited, and for how long? How many European languages to you speak?

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

#63

Post by Silhouette »

michaelfeathers wrote: post #60
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.

But there are regulatory things too. I've heard (don't know how true it is) that if your business fails in the UK you are not allowed to start another for a period of time. I've heard of similar laws throughout Europe.

I've heard (don't know how true it is) that if your business fails in the UK you are not allowed to start another for a period of time.

I think you have probably heard a partial truth, perhaps related to some kind of bankruptcy procedure, and inferred too much.

It's true that there is typically more regulation of businesses in Europe than in the US, but often it relates to fields like employment rights, consumer protection, data protection, etc. The actual cost and effort required to operate a business (edit: in the sense of setting up a legal entity to use for trading purposes, filing the mandatory paperwork, and paying the associated fees/taxes) varies widely among EU nations, but with a very low lower bound.

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

#64

Post by mbesto »

antr wrote: post #58
mbesto wrote: post #53

Earlier quoted context omitted.

Have you ever tried to sell something in English to a French company? Have you ever tried to sell something in Russia without "having a connection" to someone? Why does Dropbox have a Irish HQ?[0] [0]- https://www.dropbox.com/dublin

Cherry pick all you want. Dropbox and others grew to millions without having a multiple-language site, European headquarters, "Russian connections", etc. My business currently sells to the world with an English website, one terms of service, one VAT, and one business location in a non-English speaking country. We are not the only ones.

You can cherry pick all of you want (i.e. your own business). How about Spotify? Why did people in Germany and the UK have to wait years after Sweden already had it (when the technology already existed)? Whereas Rdio in the US was able to tap into 350 million people right off the bat.

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

#65

Post by antr »

mbesto wrote: post #64
antr wrote: post #58

Earlier quoted context omitted.

Cherry pick all you want. Dropbox and others grew to millions without having a multiple-language site, European headquarters, "Russian connections", etc. My business currently sells to the world with an English website, one terms of service, one VAT, and one business location in a non-English speaking country. We are not the only ones.

You can cherry pick all of you want (i.e. your own business). How about Spotify? Why did people in Germany and the UK have to wait years after Sweden already had it (when the technology already existed)? Whereas Rdio in the US was able to tap into 350 million people right off the bat.

Spotify's rollout has nothing to do with the country's laws nor regulation, but due to private commercial agreements between parent record labels and countries' OpCos. Blaming a country's laws and regulations, instead of the private commercial/licensing agreements that stifle content rollout is unheard of. You are mixing two very different topics.

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

#66

Post by Dewie »

RivieraKid wrote: post #54
Dewie wrote: post #45

Earlier quoted context omitted.

This is the great thing about the pop psychology part of evolutionary psychology. Now everyone can make up any theory that they want relating to genetics, and just support it with their own arguments and/or common sense - no empirical science or investigation needed on their part. And now just say 'genetics' and their argument sounds like it came from some hard-ish science, and was not just conjured up by their own m…

I clearly stated that it's a hypothesis. The biggest assumption, that immigrants are less risk-averse, sounds very plausible to me.

> I clearly stated that it's a hypothesis.

Yes, after someone explicitly asked you to back up your initial statement.

> The biggest assumption, that immigrants are less risk-averse, sounds very plausible to me.

And that's my point. All you need to talk about hereditary traits in these contexts is some vague notion of what seems plausible and believable, and not any actual data. And yet, people are probably going to find it more believable because genetics are involved than someone who explicitly bases it on some purely sociological theory, because genes sound more tangible than sociological theory and the statistics based on that.

It's not that there is anything wrong with making up theories. But by stating that it has to do with genes - without any initial disclaimer that it is just a theory - makes it sound like it is based on data and not just a theory.

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

#67

Post by k-mcgrady »

vertasd wrote: post #51
k-mcgrady wrote: post #24

Earlier quoted context omitted.

You're just repeating old stereotypes.

Actually he is 100% right. It's a different cultural behaviour in Europe. In the last 15 years I visited most of Europe and major cities of the world and the mentality is definitely different. Americans are more optimistic than Europeans and they see risk differently. Also, take into account the past, the living standards during the course of history. While americans were chilling in the 80s and 90s, many countries o…

I am European. It's a stereotype.

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

#68

Post by michaelochurch »

ThomPete wrote: post #40
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"

Yeah, that's horrible. It really drains the culture when personal loans/savings are the only way to finance a business. The US Midwest actually has a lot of talent (and geat schools) but so much of that talent ends up on the coasts.

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

#69

Post by hga »

Hermel wrote: post #36
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,…

What about the frequently (and generally??) much higher difficultly in letting people go, which I'm told results in it being much more difficult to get hired in the first place?

To the extent that's true, that would make it much more difficult to find good, "risk-seeking" or at least risk tolerant employees.

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

#70

Post by troels »

raverbashing wrote: post #56
troels wrote: post #38

Earlier quoted context omitted.

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.

If you do localization, don't think only language will cut it. Address systems, payment systems, "simply taking credit cards" may not cut it. But in the end you have to launch targeting one or more countries, whatever comes beyond that is "free". And of course, you start from day 0 to make your system Unicode compliant.

Curiously, charsets actually is less of an issue within EU - Latin1 should cover. (Not that anyone should use that in a modern app today)

But otherwise I agree with your sentiments - Language is just one of several problems. Most of which are external to the product.

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