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Why I’m giving up on Europe and moving my startup to China

maxkle.in

31–40 of 122 posts

Re: Why I’m giving up on Europe and moving my startup to China

#31

having been in all three places, you should leave europe to start your company. but move to silicon valley instead.

How will moving to SV help with his number one concern (programmer cost)? In the EU he pays $5000/month for programmers. In the valley he will be paying roughly twice that.

(The valley may have higher quality programmers and a better tech ecosystem, but I'm guessing the author is looking for grunts rather than artisans.)

Re: Why I’m giving up on Europe and moving my startup to China

#32
I lived in China in 2008 and while I'm no expert on China, you will learn quite quickly that some of your perceptions about China are not true:

- In china, you can pay a programmer 600€ a month

Sure, for average programmers. For good ones, you are going to be paying the same as elsewhere. A friend of mine there told me her brother was earning nearly $500 US/day working as a programmer for a company and they even gave him one week off per month. That would be a monthly salary of $500 x 5 days x 3 weeks = $7500

- you have a wide pool of qualified people leaving university which you can always pick from.

True but the Chinese educational system is very different from the "West". Their educational system focuses more on memorization. Creativity and problem solving are not taught very much. This is going to be a huge problem when hiring programmers right out of university. They will be looking to you to tell them everything they should be doing.

- Also, in china people are more willing to travel around to find an appropriate job than in Europe

Yes, I would say this is generally true amongst all classes.

- Quite apart from the chinese programmers, it’s also easier to get foreign programmers to work for you in china than in europe

Are you talking legally or just by the candidate's motivation?

When I was looking for a job as an English teacher, I went to one place and they told me they were only one of two officially registered English schools in the city. They told me that I would need a TESL (Teaching English as a Second Language) degree, which I did not have, in order for them to arrange the work visa. At the place I was hired, I still did not have a TESL degree but they arranged the work visa for me no problem.

Yes, it is more of the wild, wild west but as a foreigner, you are not going to be able to figure out the system very fast and it will cause you a lot of frustration and wasted energy.

- Important is that there are very low additional costs paid to the government. In Europe, you could pay 1/3 – 1/2 of your profits as a small company just servicing the goverment, China does not require this.

To be blunt, this is a very naive statement. Official costs might be low but you're not factoring bribes and other unofficial costs into the mix.

While teaching English, most of my students were in their 20s and 30s so I would often try to bring up topics of conversation for me to understand the way business works there. Many students would tell me that they would hate when government inspectors would come by as that would mean they would need to pay bribes to them. It is also expected that companies need to lavishly entertain these visitors, so in addition to the bribes, you are expected to drop hundreds/thousands of dollars on dinners and drinks.

Many students would also tell me that their dream job was to be a purchaser for a company. Some explicitly told me that this is because then they could receive kickbacks. I also heard quite a few stories about people stealing from their own companies. In fact, one story came from a guy who was just hired at a company and the manager encouraged him to "take a little for himself." The guy was uncomfortable doing this but he later found out that pretty much everyone in the company was doing this and only the owners were unaware of it.

This is the mindset that you need to adjust to. Many people do not think there is anything wrong with bribes and stealing from the company. If you are going to pay them low salaries, they will find a way to make it up from you.

Anyways, I wish you the best of luck. You'll sure learn a lot. It would be great to see a follow-up post from you in 6 months with your experiences.

Re: Why I’m giving up on Europe and moving my startup to China

#33
post #29

What I don't like in the article is the accent that is put on the advantages of the entrepreneur and little accent on the employee. It's great that you can fire people when you want, but it sucks if you're the one getting fired.

Why would you want to work for a place that wants to fire you but can't because of governmental regulation?

It's not the gov't regulation that is the problem but how integrated your job is to your lifestyle. You can't rent an apartment without either having a sufficiently large deposit or having your employer cosign for you. You can't open a bank account without having a job (for example, after arriving in Paris, I walked into HSBC to open an account with 2000€ cash, the manager said I should take it to the post office).

Firing someone is not the problem, it's the ensuing lawsuit that's the problem. If it's not done in a particular way you may end up paying an entire years salary instead of a few months.

Re: Why I’m giving up on Europe and moving my startup to China

#34

having been in all three places, you should leave europe to start your company. but move to silicon valley instead.

How will moving to SV help with his number one concern (programmer cost)? In the EU he pays $5000/month for programmers. In the valley he will be paying roughly twice that. (The valley may have higher quality programmers and a better tech ecosystem, but I'm guessing the author is looking for grunts rather than artisans.)

Didn't he say 5000 Euro a month loaded costs? That's low end of the market where I am in the UK - for people with specific domain knowledge or a proven track record you would be paying a lot more.

Re: Why I’m giving up on Europe and moving my startup to China

#35
post #6

having been in all three places, you should leave europe to start your company. but move to silicon valley instead.

I wish this were possible, but the difficulty in doing this is massive. If you are not U.S born, it's QUITE difficult to simply walk in and start a company in the U.S. And you'd spend a lot of time just solving those problems, and have a lot less time to setup your company. In comparison, I landed in china on thursday. Today is monday, and I have a fully furnished office (with furniture I selected myself), an assista…

  In comparison, I landed in china on thursday. Today is
  monday, and I have a fully furnished office (with furniture 
  I selected myself), an assistant and 25 interviews with 
  programmers scheduled for this week. The business papers 
  have been submitted, bank accounts have been setup.
How much money did you need to spend for all that?

Re: Why I’m giving up on Europe and moving my startup to China

#36

What I don't like in the article is the accent that is put on the advantages of the entrepreneur and little accent on the employee. It's great that you can fire people when you want, but it sucks if you're the one getting fired.

Create value and it will suck to fire you.

Yes, I know this - but life's not always fair now is it ?

In this particular case it might not be a problem since Max can keep an eye on his employees , but as soon as you have a manager - you might be very afraid to get on his bad side (maybe in an argument over something technical or a complaint about your chair) for fear of getting fired.

Re: Why I’m giving up on Europe and moving my startup to China

#37
post #2

It reads incredibly naive, but I wish the author the best of luck. He should however be prepared that drawbacks of Chinese way of doing business sometimes outweigh its advantages.

I don't think it's that naive. He mentioned several times that he has Chinese friends and locals who will help him. A lot of the replies here have been "don't do anything without a local" - that's exactly what he's not doing, because he knows some persons.

Re: Why I’m giving up on Europe and moving my startup to China

#38
post #30
post #22

Is it at all possible to change the title from Europe to Germany. Most of his complaints are German specific and don't apply to everywhere in Europe. Bureaucracy: I've heard regularly bad things about the German bundes. I've heard good things about UK, Sweden, Romania, Hungary. Labor: Whether you get it here or there the price of labor is only going up, but in China it's going up faster. Programmers are expensive. I'…

While I agree with you for Labor and Costs and Taxes, I beg to differ about the travel part. With all due respect, the knowledge you and your "french or english friends" have about Asia is obviously limited, and equating them to the culture and history of many Asian countries is ridiculous. It is like saying "what does Europe offer other than museums?"

I don't think you read my comment correctly. The author was saying there were more interesting places to see in Asia than Europe, then proceeded to list the same asia-pacific beach circuit everyone else wants to go see. Maybe he really is interested in those countries, maybe he is only interested in those beaches. Most of my friends when they come back from SE Asia only talk about the beaches and how cheap everything is. It's hard to make a meaningful connection to a place on 1-2 weeks vacation.

Re: Why I’m giving up on Europe and moving my startup to China

#39
"There are so many little ‘unfreedoms’ in Europe"

I must admit, China would have never crossed my mind as the country of freedoms. But then, I've never been there. Also, I weigh some freedoms higher than others - I don't like that the Chinese government has the freedom to shoot me...

Re: Why I’m giving up on Europe and moving my startup to China

#40

Earlier quoted context omitted.

How will moving to SV help with his number one concern (programmer cost)? In the EU he pays $5000/month for programmers. In the valley he will be paying roughly twice that. (The valley may have higher quality programmers and a better tech ecosystem, but I'm guessing the author is looking for grunts rather than artisans.)

Didn't he say 5000 Euro a month loaded costs? That's low end of the market where I am in the UK - for people with specific domain knowledge or a proven track record you would be paying a lot more.

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