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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?

#91

Post by stretchwithme »

vonnik wrote: 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…

Its number two, the ability to move to somewhere where you can keep more of what you create.

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

#92

Post by skimpycompiler »

vonnik wrote: 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…

Yep, also Outfit7 is definitely a good example how even in smaller countries one can achieve great success, I believe that founder became the richest man in Slovenia due to the success of his apps.

It's quite weird that Europe can be considered a bad place to succeed. Slovenia is a cheaper country than US, talent pool is still large enough, a startup in European countries like Serbia, Slovenia, Croatia and similar can last way longer and employ more people for the same millions that US startups burn through incredibly fast. Not to mention the expensive standards of living in silicon valley.

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

#93

Post by travisp »

Shivetya wrote: post #22

Over regulation. He talks all around that word but its key to why. The barrier to entry becomes much more difficult to surmount.

This is very variable across Europe (of course that could be an issue on its own). The Heritage Foundation's Economic Freedom indexes consistently place some European countries higher than the US (e.g. Switzerland and Denmark rank higher overall). In many areas, many European countries have less regulation than the United States.

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

#94

Post by harperlee »

dang wrote: post #84

Since there's much evidence we're not the only ones here who cringe at this use of "unicorns", we replaced it with "successful startups" in the title. If anyone thinks of a better substitution, we can change it again. (Edit: we changed it again.)

But OP makes an interesting case for it in https://news.ycombinator.com/item?id=10220546 : this is more specific than "successful startups". Perhaps we should coin a new term in HN. Something with cosmic rays in it might be appropriate.

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

#95

Post by robk »

nakedrobot2 wrote: post #85
atmosx wrote: post #3

Lack of investors. Simple as that. Companies that run on deficit for 5-10 years can not survive in Europe. Facebook, twitter, etc. Wouldn't be able to survive in Europe, simple as that. ps. I hate the word 'unicorn'.

Because investors in Europe are a bunch of pathetic spineless banker types.

Not all but there are indeed a disproportionate # of ex-financiers vs the composition of Valley firms. I did this analysis a while ago and it was pretty striking when graphed. The only consistency was MBAs in VC roles across the board.

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

#96

Post by qiqing »

vonnik wrote: 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…

The article also doesn't mention an obvious bias, that is, if a startup starts in Europe, there are a lot of incentives for that startup to move to the U.S. early in its life cycle.

In that scenario, the startups who become successful (and who originated elsewhere) all get counted as U.S. successes. This would vastly undercount both the total number of startups elsewhere as well as the number of successful startups.

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

#97

Post by robotresearcher »

wildmusings wrote: post #58
wpietri wrote: post #34

Earlier quoted context omitted.

Yes, I'm so upset that the government funded all the initial development of the Internet, crushing things like Compuserve and AOL and AT&T's videotex offering. Who knows where we could be today if only those had been allowed to flower. (Well, I know the planet would be 3 inches deep in AOL promotional mailers. But besides that.)

One example of successful state investment doesn't really say anything about what the ideal level of overall state economic intervention is. Research spending like DARPA isn't even representative of how Western governments regulate and tax.

It's a pretty special example, and a perfect counterexample to a careless generalization.

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

#98

Post by robk »

Those lists are often incomplete sadly because the actual underlying data on startups is much worse here in Europe. For whatever reason people don't submit data to places like Crunchbase and the media channels here are far less consistent covering things, particularly outside the English-speaking domain. My partner has been compiling his own list here. Feel free to edit. https://docs.google.com/spreadsheets/u/1/d/1cWhizlf_KU7KOsw8...

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

#99

Post by bitL »

There is no Delaware. Taxes are paid regardless of whether the company hits $1M revenue or not, salary taxes are high, health/social insurance is mandatory and paid for the most part by the employer, there is a minimal salary, extensive bureaucracy and you can't sign away most of your rights if necessary for company survival. Moreover, some countries impose rules which make starting up with little to no money impossible (Germany).

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

#100

Post by mattmanser »

donkeyd wrote: post #31

I've posted this before, but since I think it's relevant here: People seem to forget that Europe is not a country. Europe does not have a single uniting language. What happens, is that every country starts their own smaller versions and they stay mostly within that country. If they want to move to another country, there's often already a major player there, and they might not have the means to kick them out. I think…

More like 450 million when you include the UK, Canada and Australia.
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