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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?

#171
In my opinion, the EU has failed (still) to be an open big market, where companies can grow without restrictions.

One current big example are the new VAT rules in the EU for non-physical products. They just do the opposite, what a free market should be. There are already companies that say on their website, that they will sell to their own countries people and happily even to people outside of the EU, but not to people living in other EU countries. The total opposite what the EU once should be. The new VAT rules also should limit the possibilities of big companies like Amazon to circumvent VAT. In reality it become a big stumble block for smaller companies.

The EU is a big market, with many, many rules. To many rules and to few thoughts on the effects particularly for smaller companies. (instead, the big corporations are effectively writing the rules)

When smaller companies do not get the chance to come up (what is happening) than the chances for Unicorns are also greatly limited. Instead the same big players are winning again and again and are doing the same dinosaur stuff again and again.

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

#172

Unicorns? Ha! It's hard to survive, let alone be successful. No investors, convoluted laws, high taxes and complete lack of startup mentality. I'm a cofounder of an italian startup, and the road is on an unbearably steep slope. The bureaucracy is insane, the cost of running a small business is daunting. Other companies refuse to work with you because in their eyes you're a scrub (I heard so many times bullshit like "…

> I heard so many times bullshit like "I don't know if you'll be alive in a year or two, so I can't adopt your technology" I'm not sure why you think this is bullshit. Most startups fail. It seems like good sense to be wary of taking a dependency on another business that might not be around in the near future instead of an alternative that has already proven itself in the market.

Yeah, the problem is that with this line of reasoning a startup is destined to fail. If I don't get clients, I can't keep my business open. That's what irks me. How can I prove myself in the market if I don't get a chance?

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

#173

Unicorns? Ha! It's hard to survive, let alone be successful. No investors, convoluted laws, high taxes and complete lack of startup mentality. I'm a cofounder of an italian startup, and the road is on an unbearably steep slope. The bureaucracy is insane, the cost of running a small business is daunting. Other companies refuse to work with you because in their eyes you're a scrub (I heard so many times bullshit like "…

>I'm a cofounder of an italian startup, and the road is on an unbearably steep Pardon the question, but I have read that organized crime is making a strong resurgence in Italy. Does this factor into your startup or affect it in any way?

And where did you hear that?

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

#174

Earlier quoted context omitted.

> 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,…

IMO the EU is too protective of its economy to allow the kind of innovation Silicon Valley is famous for. The EU has a default assumption of "you have to prove that this will not be harmful before you can do it" where the US has a default assumption of "someone else has to prove that this will be harmful before we will stop you". The important part is that this burden of proof in the US is not placed on a company at…

> They're only able to address the EU market because they have a large, profitable base in the US.

Uber is only able to address any market because they have a ton of outside venture funding.

Don't get me wrong - I agree that the EU is overly protective and that this harms their startup economy, but Uber is not a good example of that point.

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

#175

Unicorns? Ha! It's hard to survive, let alone be successful. No investors, convoluted laws, high taxes and complete lack of startup mentality. I'm a cofounder of an italian startup, and the road is on an unbearably steep slope. The bureaucracy is insane, the cost of running a small business is daunting. Other companies refuse to work with you because in their eyes you're a scrub (I heard so many times bullshit like "…

>I'm a cofounder of an italian startup, and the road is on an unbearably steep Pardon the question, but I have read that organized crime is making a strong resurgence in Italy. Does this factor into your startup or affect it in any way?

Luckily no, organized crime is spread mostly on other regions, and as far as I know it doesn't seem involved in the ICT field. At least I hope :)

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

#176

It is quite easy question actually. In short, US is unified market with one language, laws for business are same across all states, one currency, one culture, low taxes, no social system and a lot of money. In EU you have 28 countries, 24 languages which equals to same amount of cultures. 11 currencies. Every country got own laws so once you make business across many countries, you have taxation and law hell. EU trie…

Europe has more Fortune 500 companies on than the US according to what I am linking. If it was just a matter of language then how come they USED to be able to create global players but aren't able to as much any more. Whats changed thats holding Europe back?

These companies were founded when the world weren't so connected. The size of US market unified with one currency and language didn't matter back then. Because if you have founded a company in California, it was hard for you to reach people in New York because there was no internet so when somebody founded a company in Germany, he had basically same position as the guy in US. And after many years the guy in Germany had a lot of money so he could easily expand to France and so on. So business were growing with same pace and it didn't matter where you were.

But there is more factors in it, Europe used be more rich (it had a lot of colonies), US wasn't so developed as it is now. GDP of US was lower than GDP of UK in 1900. And of course laws changed, we have more bureaucracy than we used to have.

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

#177

Earlier quoted context omitted.

> I heard so many times bullshit like "I don't know if you'll be alive in a year or two, so I can't adopt your technology" I'm not sure why you think this is bullshit. Most startups fail. It seems like good sense to be wary of taking a dependency on another business that might not be around in the near future instead of an alternative that has already proven itself in the market.

Yeah, the problem is that with this line of reasoning a startup is destined to fail. If I don't get clients, I can't keep my business open. That's what irks me. How can I prove myself in the market if I don't get a chance?

If a potential buyer makes that excuse, sell them a expensive long term support contract and offer to put your Intellectual Property (code)in some form of escrow such that the buyers will have access to your code should you fail to support your product in 2 years.

Or become a IBM /HP/MS technology partner and sell through them.

Goodluck !

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

#178

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)?

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 need nearly as much - a good engineer in SV costs $250k; the same engineer in Austin costs $110k, and it's entirely possible to live on $10k a year while bootstrapping a startup. There are also a half dozen internationally-recognized engineering schools within 2 hours of I-35.

New York just has a ton of people and a ton of money. Also, the global media machine is based there as well, which is why you see a lot of media and advertising startups coming out of NYC. NYC is also attractive to people who weren't born there.

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

#179
post #88

Not sure that the premise of this article is even correct. I can think of a lot of successful European startups -- Minecraft, Spotify, Skype, DeepMind, the list goes on... -- and just as many startups led by Europeans that have succeeded in America (Lending Club, etc.). But if Europe has trouble supporting "unicorns", there are probably a couple reasons: 1) Gaps in the funding ladder. 2) Talent flight. 3) A preferenc…

Teamviewer to add to your list and here are a couple more:

https://techberlin.com/articles/16-biggest-exits-so-far/

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

#180

Earlier quoted context omitted.

> I heard so many times bullshit like "I don't know if you'll be alive in a year or two, so I can't adopt your technology" I'm not sure why you think this is bullshit. Most startups fail. It seems like good sense to be wary of taking a dependency on another business that might not be around in the near future instead of an alternative that has already proven itself in the market.

Yeah, the problem is that with this line of reasoning a startup is destined to fail. If I don't get clients, I can't keep my business open. That's what irks me. How can I prove myself in the market if I don't get a chance?

It sounds like you're trying to sell to late adopters at the early stage. Check out Crossing the Chasm. https://en.wikipedia.org/wiki/Crossing_the_Chasm
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