Tech investors can’t get enough of Europe’s fizzing startup scene(economist.com)
economist.com
Tech investors can’t get enough of Europe’s fizzing startup scene
https://www.economist.com/business/tech-investors-cant-get-enough-of-europes-fizzing-startup-scene/21806435
170 comments
https://archive.md/SsgdQ
Funny they didn’t mention UI Path and some others like Darktrace, Deliveroo, Getir, Trendyol etc… :
https://sifted.eu/articles/europe-unicorns-2021/
https://sifted.eu/articles/uipath-seed-investors/
https://sifted.eu/articles/europe-unicorns-2021/
https://sifted.eu/articles/uipath-seed-investors/
> “Now Spotify is the winner in music streaming, Klarna is the winner in buy-now-pay-later and UiPath is the winner in robotic process automation—they’re all European,” he says.
> Klarna is the winner in BNPL
lol what a bold and wrong statement
lol what a bold and wrong statement
Swedish Klarna is privately valued at 45.6B.
US Affirm is publicly valued at 34.55B.
AUS Afterpay is publicly valued at 31.19.
I don’t think it is a bold statement. All the major competitors are pretty close.
US Affirm is publicly valued at 34.55B.
AUS Afterpay is publicly valued at 31.19.
I don’t think it is a bold statement. All the major competitors are pretty close.
That is why it's a bold statement. The landscape is still rich with competitors and seeing new entries. Affirm and Afterpay are public. Klarna is private and the beneficiary of a very frothy VC market. Their rounds are led by Softbank which many investors think is leading a charge in overvaluing unicorns.
We'll see how things shake out. Calling them 'the winner' of the market is just odd.
We'll see how things shake out. Calling them 'the winner' of the market is just odd.
Calling them 'the winner' of the market is just odd.
Calling them the winner right now is fine. They are winning.
They have not won though. The game is still on.
Calling them the winner right now is fine. They are winning.
They have not won though. The game is still on.
Measuring private valuations vs. public valuations is dubious. I don't think it's as clear cut as people are making it.
Valuations is dubious regardless private/public. See Tesla or Rivian...
I don't really have a horse in this race, but surely the big credit card companies are the big dogs in the "buy now pay later" market? Or is there some highly tech-specific submarket these days?
Credit cards are in a great position to get into this market since they can use your existing line of credit and don't require a new credit check in order to give you a loan. The Apple credit card is a great example, where now you can buy any apple products on a monthly payment plan with no interest and without any extra friction at check-out.
But I don't think most banks issuing credit cards are in this business yet. And of course making normal purchases on credit cards is a terrible way to "buy now pay later" because the interest rates are so ridiculously high.
It will be interesting to see if more banks get into this market seeing how successful Klarna, Affirm, etc. seem to be, because it does eat into their existing high interest rate profits on credit cards.
But I don't think most banks issuing credit cards are in this business yet. And of course making normal purchases on credit cards is a terrible way to "buy now pay later" because the interest rates are so ridiculously high.
It will be interesting to see if more banks get into this market seeing how successful Klarna, Affirm, etc. seem to be, because it does eat into their existing high interest rate profits on credit cards.
Buy now, pay later platforms allow random e-commerce sites to support installment payments. Thus, mom and pop e-commerce sites don't need to build it out. It's all provided as a SaaS.
It's similar but a little different, as it is usually shorter (you need to pay it in a set number of installments over a fixed schedule, like 4 weeks) and there's no interest if you pay on time, at least with Klarna. I have no idea how they make money (maybe they make some money from the interchange?) but that's the gist of their business model.
They earn a fee from merchants and, despite what they say, I believe most of these companies also have products that aren't zero interest (Affirm also sells some of its loans...I have no idea about this, I have relatively good knowledge of accounting but I am not 100% on the accounting for this so I have no idea whether it actually generates income).
The fee from merchants is interesting because the claim is: the fee from merchants is going to be larger than the losses from making bad loans (and the costs of servicing). I am very sceptical of this. Management describe their underwriting model as largely using stuff like the product bought, the retailer used, the value of the order...it just sounds very suspect. And that is before you consider the valuation, the legislative risks, the interest rate risk (doing 0% loans stops making sense if interest rates rise), etc. I am in the UK and these kind of businesses usually trade at very low multiples because the regulation in the space is so high.
I would regard $10bn market cap as a pretty jazzy valuation for Affirm, the stock is at $35bn.
The fee from merchants is interesting because the claim is: the fee from merchants is going to be larger than the losses from making bad loans (and the costs of servicing). I am very sceptical of this. Management describe their underwriting model as largely using stuff like the product bought, the retailer used, the value of the order...it just sounds very suspect. And that is before you consider the valuation, the legislative risks, the interest rate risk (doing 0% loans stops making sense if interest rates rise), etc. I am in the UK and these kind of businesses usually trade at very low multiples because the regulation in the space is so high.
I would regard $10bn market cap as a pretty jazzy valuation for Affirm, the stock is at $35bn.
They make money when you don't pay on time.
credit has been the ruin of whole societies -- what can go wrong?
UiPath, while founded in Romania, is officially headquartered in the US (NYC) and is counted in US / NYC funding amounts. 80% of the team is not in Europe either, with the entire management team in the US. So they aren't usually included in any Europe VC roundups, despite the origin of the company.
> 80% of the team is not in Europe either, with the entire management team in the US.
Is that really the case? Their main R&D center is in Romania and it's huge.
If anything, it's probably the other way around since management is the top of the pyramid, which kind of by definition, is not a lot of people.
Is that really the case? Their main R&D center is in Romania and it's huge.
If anything, it's probably the other way around since management is the top of the pyramid, which kind of by definition, is not a lot of people.
Yes, counting the sales, marketing, solutions development, partner management, education, consulting, and other parts of the company, the vast bulk of the team are not in Romania, even though a large part (but not all) of the R&D team is there.
More details here: https://craft.co/uipath
More details here: https://craft.co/uipath
I'm not sure I agree with your original estimate (80% being outside of Romania, let alone 80% in the US). Checking some Romanian articles, they had 800 out of 2800 people in Romania in January 2021.
On top of that, they have offices around the world, so it's very unlikely that all the other 2000 are only in the US.
On top of that, they have offices around the world, so it's very unlikely that all the other 2000 are only in the US.
My original comment was "80% of the team is not in Europe either". I didn't say 80% in the US, and I wouldn't make that claim now.
Furthermore, as per above link, Employees (est.) (Jan 2021) 2,863. Romanian employees are not 800 as claimed in that article, and closer to 600. 20% of 2863 is 572.
Even 800 out of 2863 is 28%, and the actual number is less than 800. It seems we are much on the same page.
Furthermore, as per above link, Employees (est.) (Jan 2021) 2,863. Romanian employees are not 800 as claimed in that article, and closer to 600. 20% of 2863 is 572.
Even 800 out of 2863 is 28%, and the actual number is less than 800. It seems we are much on the same page.
https://www.zf.ro/burse-fonduri-mutuale/cati-angajati-are-ui...
Which takes me to:
https://sec.report/Document/0001193125-21-094920/#rom98556_2
> As of January 31, 2021, we had a total of 2,863 full-time employees. Of our employees, 714 were engaged in research and development. 122 full-time employees were based at our headquarters in New York, New York, and 727 full-time employees were based in Bucharest, Romania
And that's from January. What are your sources? You're very confident for someone contradicting their IPO documents ;-)
Plus you're moving the goalposts. I proved that more than 20% are in Romania alone (your own math says 28%), UIPath has other European offices. So it's entirely possible that around 50% of UIPath employees are in Europe. I'm too lazy to check.
My point is that UIPath was started in Europe and has a strong presence in Europe. The main development center is in Europe. The top management is European. It can't be considered a purely American startup.
Which takes me to:
https://sec.report/Document/0001193125-21-094920/#rom98556_2
> As of January 31, 2021, we had a total of 2,863 full-time employees. Of our employees, 714 were engaged in research and development. 122 full-time employees were based at our headquarters in New York, New York, and 727 full-time employees were based in Bucharest, Romania
And that's from January. What are your sources? You're very confident for someone contradicting their IPO documents ;-)
Plus you're moving the goalposts. I proved that more than 20% are in Romania alone (your own math says 28%), UIPath has other European offices. So it's entirely possible that around 50% of UIPath employees are in Europe. I'm too lazy to check.
My point is that UIPath was started in Europe and has a strong presence in Europe. The main development center is in Europe. The top management is European. It can't be considered a purely American startup.
> The main development center is in Europe. The top management is European.
But for how long?
But for how long?
It's been founded by Romanians, the CEO and founder is a major shareholder (he's the richest Romanian at the moment, $8.3bn). Some other CXOs are also Romanian, friends of the founder, I think.
The Romanian R&D center is obviously competitive, otherwise we wouldn't have so many offices from purely American companies in Romania.
So the direct answer is: for long enough, I hope :-)
The Romanian R&D center is obviously competitive, otherwise we wouldn't have so many offices from purely American companies in Romania.
So the direct answer is: for long enough, I hope :-)
Should not be double-counted in regarding the funding, indeed, but it still is a 'romanian company', and it's not really in the "startup phase" anymore, it actually has some long history but only post-covid became very successful.
European startups that are remotely successful literally have to move to NYC(or any other US city i guess, but NYC is the preferred choice, though it may be expensive) to not die off.It's not even a joke, and it's the sad reality of living in the grandious European Union that suffocates you with bureaucracy.There have been places that became lax towards tech startups (see cz for example), but even with laws being slowly changed/ignored, the money either isn't there compared to US, and even if there is (see france, uk especially post brexit), the investing entities lean on the fact that there's more talent/square meter, so they're not really that quick to pull the trigger if they can save on some bucks.
European startups that are remotely successful literally have to move to NYC(or any other US city i guess, but NYC is the preferred choice, though it may be expensive) to not die off.It's not even a joke, and it's the sad reality of living in the grandious European Union that suffocates you with bureaucracy.There have been places that became lax towards tech startups (see cz for example), but even with laws being slowly changed/ignored, the money either isn't there compared to US, and even if there is (see france, uk especially post brexit), the investing entities lean on the fact that there's more talent/square meter, so they're not really that quick to pull the trigger if they can save on some bucks.
> Deliveroo
How perceptions of this company has changed. Prices are ridiculous, both from the Deliveroo mark up and what the restaurants charge extra to make up for that markup (4EUR bottled water seriously?)
More than half the riders here in Belgium are illegal immigrants using fake rider accounts that don't speak the local language. There's a squat near my house where they all hang out waiting for a call.
Seriously, look in side the window and you see a bunch of guys sitting around on broken chairs and crates surrounded by their Deliveroo backpacks (which are all filthy and worn out). They're so destitute and sorry looking that when one comes in to a restaurant to pick up a delivery you think omg.
I'm not someone who usually takes the side of "those poor workers" but in this case Deliveroo really runs on paying the poorest, more vulnerable people in society pennies to deliver over priced meals that a restaurant sold them for something like 30% less than they usually would.
Meanwhile the industry's gravitating toward ghost kitchens, putting even more unfair pressure on local restaurants.
Seriously I'd love drag whatever MBA is behind this company and show them what their "high valued startup" looks like here. I don't understand how these people sleep at night.
And then there's Lendable: "Loans at 28.6% Representative APR" and we're supposed to be amazed they turn a profit?!
How perceptions of this company has changed. Prices are ridiculous, both from the Deliveroo mark up and what the restaurants charge extra to make up for that markup (4EUR bottled water seriously?)
More than half the riders here in Belgium are illegal immigrants using fake rider accounts that don't speak the local language. There's a squat near my house where they all hang out waiting for a call.
Seriously, look in side the window and you see a bunch of guys sitting around on broken chairs and crates surrounded by their Deliveroo backpacks (which are all filthy and worn out). They're so destitute and sorry looking that when one comes in to a restaurant to pick up a delivery you think omg.
I'm not someone who usually takes the side of "those poor workers" but in this case Deliveroo really runs on paying the poorest, more vulnerable people in society pennies to deliver over priced meals that a restaurant sold them for something like 30% less than they usually would.
Meanwhile the industry's gravitating toward ghost kitchens, putting even more unfair pressure on local restaurants.
Seriously I'd love drag whatever MBA is behind this company and show them what their "high valued startup" looks like here. I don't understand how these people sleep at night.
And then there's Lendable: "Loans at 28.6% Representative APR" and we're supposed to be amazed they turn a profit?!
All of the food delivery companies are predatory. Haven't seen a single one yet that is doing anything other than to squeeze the restaurants, the customers and the deliverators for every last dime.
takeaway.com employs their riders, I think.
Hilariously enough, they resisted doing the deliveroo style delivery for a long long time as they couldn't see a way to make money on it.
> More than half the riders here in Belgium are illegal immigrants using fake rider accounts that don't speak the local language.
Have you considered reporting them? Through the app or to the local authorities?
> Meanwhile the industry's gravitating toward ghost kitchens, putting even more unfair pressure on local restaurants.
That's actually great... and not new. Delivery-only restaurants means better margins for restaurant owners and a different business model.
Have you considered reporting them? Through the app or to the local authorities?
> Meanwhile the industry's gravitating toward ghost kitchens, putting even more unfair pressure on local restaurants.
That's actually great... and not new. Delivery-only restaurants means better margins for restaurant owners and a different business model.
> Have you considered reporting them? Through the app or to the local authorities?
A newspaper reported this after conducting their own investigation (basically asking the riders) so it's public knowledge now. "Deliveroo disputes those figures" https://www.msn.com/nl-be/financien/nieuws/meerderheid-maalt...
It's not my business to report them to the authorities, there's tons of "refugees" here and I don't necessarily think they should leave. My point was just that a "unicorn" running on the labor of these people is a pretty ugly way to conduct business.
A newspaper reported this after conducting their own investigation (basically asking the riders) so it's public knowledge now. "Deliveroo disputes those figures" https://www.msn.com/nl-be/financien/nieuws/meerderheid-maalt...
It's not my business to report them to the authorities, there's tons of "refugees" here and I don't necessarily think they should leave. My point was just that a "unicorn" running on the labor of these people is a pretty ugly way to conduct business.
Looks like Getir has proven the business model locally but considering their latest moves in the UK, their main goal is capturing the European market.
I have doubts about the whole instant-delivery space though. Profit margins are probably not large enough to make the business sustainable. The scenario looks like winner-takes-all or at least hold your breath until IPO.
An article from earlier today seems to decry Europe's startup scene [0]
[0] https://news.ycombinator.com/item?id=29316357
[0] https://news.ycombinator.com/item?id=29316357
I've worked on startups in the US and Europe, and there definitely are differences. Say what you want about the US, but the general risk tolerance and attitude of forgiveness around failure are a good match for startup culture.
Main issue in the EU is still compensation. They are pretty stingy with equity and salary.
And risk wise, yes, US tends to swing for the fences more often which produces unicorns. EU tends to go more traditional and safe routes (aka boring).
And risk wise, yes, US tends to swing for the fences more often which produces unicorns. EU tends to go more traditional and safe routes (aka boring).
... nonsense! EU startups are not "talent" but capital limited. Boring or not, EU startups lack money to develop their product to a decent stage, grow to a sort of minimum size to be taken seriously, etc.
It's not magic though. Keeping a company alive takes money. (And if it's the investors' money it's called capital.) US startups pour a really ridiculous money into growth exactly because they want to break out of this stage. And naturally that's risky.
Of course if the access to capital was a lot easier compensation would be higher too.
It's not magic though. Keeping a company alive takes money. (And if it's the investors' money it's called capital.) US startups pour a really ridiculous money into growth exactly because they want to break out of this stage. And naturally that's risky.
Of course if the access to capital was a lot easier compensation would be higher too.
They lack money because European capital is risk averse.
They could even have a similar risk tolerance but Europe just has more risks. If any one of the big US startups was based in the EU they would have been regulated a long time ago.
Some perhaps (Uber? even that is debatable) but any one is really a stretch. Most of them would be entirely fine in Europe, just that it's not happening.
What's the point of high compensation when most of it will end up getting taxed away? If you combine employee/employer taxes/contributions it gets to 80%. Add a huge amount of regulations and unions to the mix.
There are some exceptions in places like Bulgaria, Belarus, or Poland. But they have much higher barriers like language and climate.
There are some exceptions in places like Bulgaria, Belarus, or Poland. But they have much higher barriers like language and climate.
> If you combine employee/employer taxes/contributions it gets to 80%.
Where are you getting that crazy number? US salary overhead is slightly higher than Denmark's (which I think is the highest in OECD), despite the supposedly low rates in the US you hear about.
In most of Europe at very high salaries the overhead is about 50%, maybe a bit more, which is basically what it is in the US in most states.
The main thing is that the US just pays a <<ton>> more. So there's more left at the end :-)
Where are you getting that crazy number? US salary overhead is slightly higher than Denmark's (which I think is the highest in OECD), despite the supposedly low rates in the US you hear about.
In most of Europe at very high salaries the overhead is about 50%, maybe a bit more, which is basically what it is in the US in most states.
The main thing is that the US just pays a <<ton>> more. So there's more left at the end :-)
VAT (sales tax) is much higher in Europe (20%+), though it won’t bring the total tax to 80%. On the other hand, taxes in the US are much generally much more progressive than in Europe. In the States, the wealthy pay large majority of the taxes, while in Europe, these are covered mostly by middle class. Therefore, for median wage earners in Europe, effective tax rate is much higher than in US.
The initial comment was about top earners, not median earners.
And my guess is that it wasn't about VAT or sales tax, but about income tax + healthcare + social security.
And my guess is that it wasn't about VAT or sales tax, but about income tax + healthcare + social security.
Not sure what is your source, but this seems to disprove that: https://taxfoundation.org/publications/comparison-tax-burden...
You're right, I missed this: https://www.oecd.org/tax/tax-policy/taxing-wages-denmark.pdf
But I can't find the other source, the point was the total overhead: income tax + healthcare + social security.
The US is surprisingly high when you add everything up.
But I can't find the other source, the point was the total overhead: income tax + healthcare + social security.
The US is surprisingly high when you add everything up.
That's for a 35.7k salary. I'm talking 6 figure salaries. To get to a 150k NET salary if you factor in income tax, payroll tax, state pension system/insurance, union contributions, and a bunch of other things it becomes 80% of the GROSS cost for the employer.
Income tax alone gets to 55% for higher bands in many countries.
And due to looming pension crisis they are planing to RAISE all these taxes and contributions.
Income tax alone gets to 55% for higher bands in many countries.
And due to looming pension crisis they are planing to RAISE all these taxes and contributions.
> Income tax alone gets to 55% for higher bands in many countries.
Do you have a list of these countries? The highest I know is 42% for the highest tax bracket, which makes the effective tax rate around 35-38% for most salaries, including the very high ones.
Do you have a list of these countries? The highest I know is 42% for the highest tax bracket, which makes the effective tax rate around 35-38% for most salaries, including the very high ones.
https://en.wikipedia.org/wiki/Tax_rates_in_Europe#Summary_li...
Sort by Maximum Income Tax Rate (3rd column).
I should've said personal income taxes and contributions not just "Income Tax". There is a nightmare of other things you can see there but effectively it's taxes on personal income.
Employers pay a lot too before this. For example in Spain they pay almost 30%.
https://www.bankinter.com/blog/finanzas-personales/del-salar... (note this is for <50k/yr, but employer contributions don't have bands)
Sort by Maximum Income Tax Rate (3rd column).
I should've said personal income taxes and contributions not just "Income Tax". There is a nightmare of other things you can see there but effectively it's taxes on personal income.
Employers pay a lot too before this. For example in Spain they pay almost 30%.
https://www.bankinter.com/blog/finanzas-personales/del-salar... (note this is for <50k/yr, but employer contributions don't have bands)
[deleted]
I think only top tax states tax you at 50% in the US. The majority of developers don't live there.
Yeah, but what are we talking about, then? Most European devs who would move to the US would move to the top states, for the top salaries.
You need to compare like with like.
You need to compare like with like.
> attitude of forgiveness around failure
This has never been my experience anywhere I've worked. I wonder if maybe this only applies to the right kinds of people and isn't really true in a general sense.
This has never been my experience anywhere I've worked. I wonder if maybe this only applies to the right kinds of people and isn't really true in a general sense.
Depends upon your audience, and how you present your experience.
US division of Japanese-owned industrial concern, you come from a flamed-out fintech, and you present it as five years of your life you'd like back: obviously not very forgiving scenario.
US sales financing department of US division of Japanese-owned industrial concern, you come from a flamed-out fintech, and you excitedly show them how you worked on getting automated factoring decision-making to work: much different result.
Know your audience, know their market, know their needs.
US division of Japanese-owned industrial concern, you come from a flamed-out fintech, and you present it as five years of your life you'd like back: obviously not very forgiving scenario.
US sales financing department of US division of Japanese-owned industrial concern, you come from a flamed-out fintech, and you excitedly show them how you worked on getting automated factoring decision-making to work: much different result.
Know your audience, know their market, know their needs.
So uh... How do I get in the club? Because I could use a few millions.
Sell a dream to those with deep pockets and shallow expectations. The dream and equity sold is the product.
Isn’t this fundamentally the best strategy when money is free? Scarcity/speculation should dominate returns.
Pretty interesting question. I know at least one company which have burned more than $5mil in VC funding over ten years, and they only have a semi stable prototype built on 15 years old tech (which they claim is an actual product). Clearly there’s money to be had, but how to get them is the question.
$5M over 10 years? I forgot how to count that low.
Yeah, I know, not a lot for a Silicon Valley startup. It's still a ton of money else where in the world. In Denmark, $100.000 will buy you a top notch developer for a year.
HN always assume Facebook, Twitter and Uber when talking startups, but the vast majority of startups in Europe are going to be much smaller, and $5M over 10 years is something that would be a godsend to most startups.
HN always assume Facebook, Twitter and Uber when talking startups, but the vast majority of startups in Europe are going to be much smaller, and $5M over 10 years is something that would be a godsend to most startups.
In SV, $5M funding over 10 years would allow you to, maybe, like, rent some coworking space, rent some computing, and hire 1-2 people.
Have ability to believe lies.
I thought fizz means eventually to fizzle out and disappear.
It's an unfortunate use of term, because while fizzy does mean bubbly and frothy, it can also mean unsustainable because the fizz in drinks never lasts.
Author should have / could have used the title "Tech Investors can't get enough of Europe's growing startup scene". Would have conveyed a much less bubbly / frothy / transient nature.
Author should have / could have used the title "Tech Investors can't get enough of Europe's growing startup scene". Would have conveyed a much less bubbly / frothy / transient nature.
My mind jumped to "fizzling out" before the "fizz" = "frothy" or "fizz is just temporary" associations kicked in. This is definitely a poor choice of adjective.
They have to say fizzing because not all of the startups are in the Champagne region of France.
In this context, it's an allusion to carbonated drinks and is a different way to say 'bubbly.'
[deleted]
"fizzing" and "fizzling" are too similar.
It has to come from the fizzing region of France, otherwise it's just a sparkling startup.
they should've said "bubbling tech scene"
Came here to say that. I read it as 'fizzling' and immediately thought the title was sarcastic.
Then the reader could associate it with a tech-bubble.
idk if "red hot" would be any better -- bubbling is what first came to mind
r/whoosh
No really, it’s about to pop
gassy
I think this is partly the fault of the word "effervescent" being too hard to spell.
[deleted]
Here is the archive link:
https://archive.md/SsgdQ
https://archive.md/SsgdQ
Wow, so content free. What companies are representative of this new scene?
Don't get me wrong - I'd love this trend - but I just don't see it yet.
Don't get me wrong - I'd love this trend - but I just don't see it yet.
TL;DR: They aren't as visible on average because there's not such a big prevalence of outliers (even if we do have some, such as Spotify).
EU creates 39% of global startups, but only 14% of unicorns. Success rate
It's historically much more revenue than growth focused, but there's quite a lot of successful startups over here as well. It ties in closely with the local culture of "Mittelstand" and a far larger share of SMB's/family businesses than bigcorps in the US.
https://www.mckinsey.com/industries/technology-media-and-tel...
EU creates 39% of global startups, but only 14% of unicorns. Success rate
It's historically much more revenue than growth focused, but there's quite a lot of successful startups over here as well. It ties in closely with the local culture of "Mittelstand" and a far larger share of SMB's/family businesses than bigcorps in the US.
https://www.mckinsey.com/industries/technology-media-and-tel...
Eg. Someone i met through a friend: OTA Insight.
( I'm not related to the scene)
( I'm not related to the scene)
When I want investment news on the hottest global markets I go to the economist for the cutting edge trends.
So which "startups" are they talking about? If they're talking about scaleups, sure. Less risky.
Slush, one of the Europe's largest startup events, is happening next week (1-2 Dec 2021) in Finland. The program contains lots of interesting talks and they will be streamed. Definitely something anyone interested in European startup scene should follow.
https://www.slush.org/events/helsinki/agenda-2021/#/
https://www.slush.org/events/helsinki/agenda-2021/#/
Thanks! Can't find streaming info in the main menu & FAQ. Will it be streamed publicly or only for ticket holders? Is there any page with details?
It might be this page: https://www.slush.org/events/slush-live-stream/
I think they will be streamed publicly. Currently, it contains streams from 2019. Year 2020 the event was canceled.
I think they will be streamed publicly. Currently, it contains streams from 2019. Year 2020 the event was canceled.
European countries still pay a solid 80% less than in America. How can they ever get talent?
Because we don't want to live in US. Because we dont like US culture. Because there's more to quality if living than just raw dollars.
oezi(1)
This is asked in like every thread about Europe. Read about income tax and the social services states provide in the EU. I'm happily giving up that "80%" for those.
Because European talent is largely confined to EU so gotta take what's being offered.
Because the talent can't get into America because of its terrible immigration system.
It's paradoxical that entrepreneurship is less of a thing in the EU than in the US. After all, Europeans can afford a lot more risk than Americans. There's a strong safety net in the form of social security. Health insurance is not tied to your employer. European university graduates don't start with lives with several $100k in debt, while having gotten an education of similar quality. Maybe the culture is shifting?
There is no paradox, only innocence. Did you know here in Portugal company directors used to be personally liable for social security payments for a business's employees in case of bankruptcy, until the end of their former contract? That meant for every engineer you hire, you might easily be on the hook for 10K with the government in case you go under. Try failing fast with that.
America was built in part by swindlers and robber-barons in a system who let them get away with it by design. In many of Europe's different legislations, failure in the bankruptcy way has/had serious consequences for the business person responsible. Play fast and loose with your responsibilities like you might in the US, confident that the corporate veil will bail you as long as you don't do anything criminal, and you might find yourself staring down the barrel of a loaded fiscal gun.
America was built in part by swindlers and robber-barons in a system who let them get away with it by design. In many of Europe's different legislations, failure in the bankruptcy way has/had serious consequences for the business person responsible. Play fast and loose with your responsibilities like you might in the US, confident that the corporate veil will bail you as long as you don't do anything criminal, and you might find yourself staring down the barrel of a loaded fiscal gun.
If this perspective of "startup failure is a deep moral sin insufficiently penalized by the government" is common in Europe then the lack of entrepreneurship is not very surprising.
Ltds are a common thing all around the world and work as you'd expect. What OP mentions seems to be specific to Portuguese law.
Running a bankrupt ltd means a lot of serious consequences in a lot of countries... like not being allowed to run another one for a long time.
You'd be surprised. If I'm not mistaken in some central European countries you could be sentenced to jail time after bankruptcy up to the 2000s. My point is precisely that ltds exist but are not the same world-wide. People (like myself) raised on American business folklore can be in for very rude awakenings when things start going badly.
We'll, the claim seemed overly broad. I wanted to point out that these harsh liabilities on the side of company directors are country specific and usually a company can go bankrupt as long as it's not the fault of the director due to them mishandling the company resources without pulling the director down with it.
Let's put it this way: If anyone is thinking of starting a business, they should spend a couple of hours researching and getting guidance from experts about the laws in their specific country. It's very easy to act cavalierly on advice meant for another jurisdiction without realising it. I have.
Another quick example from Portugal: Did you know businesses or business-like entities (we have those for smaller entrepreneurs) are required to keep a 10-year archive of paper receipts, regardless of having already filed digital copies with the government or of any other common-sense exception? Most people here don't. But they can get serious fines for not being able to produce almost decade-old records they had no clue were mandatory.
The points are: a) that there is no such thing as "europe" to begin with in a regulatory sense; b) but there are structural reasons why entrepreneurs in the area behave like they do, it's not an accident; c) only the paranoid survive, so do your research because there will be a test later and you don't get a do-over.
Another quick example from Portugal: Did you know businesses or business-like entities (we have those for smaller entrepreneurs) are required to keep a 10-year archive of paper receipts, regardless of having already filed digital copies with the government or of any other common-sense exception? Most people here don't. But they can get serious fines for not being able to produce almost decade-old records they had no clue were mandatory.
The points are: a) that there is no such thing as "europe" to begin with in a regulatory sense; b) but there are structural reasons why entrepreneurs in the area behave like they do, it's not an accident; c) only the paranoid survive, so do your research because there will be a test later and you don't get a do-over.
Startup failure is fine, not being accountable to your employees is what we have a problem with. The concept of the workers council in German law keeps throwing wrenches into the attempts to import the more exploitative business models from the US (N26 and Gorillas are recent cases) and Walmart completely flopped for related reasons. I do admire the business and entrepreneurship culture over the pond, but I think we can import the best bits of that without treating humans like fungible capital and burnout culture. It will just take a lot of time, especially in Germany (my native country), the business culture is still very conservative in the sense of rule based and authority/hierarchy oriented. I think if Germany adopted californias laws on non-competes and employee IP a lot would be gained already.
Notably, Sweden has a very robust social security network and a lot of entrepreneurship as well, the Swedes I talked to explicitly pointed to it as something that eased their way into taking risks.
Notably, Sweden has a very robust social security network and a lot of entrepreneurship as well, the Swedes I talked to explicitly pointed to it as something that eased their way into taking risks.
Are you implying that startup success in America requires exploitation of workers? I don't think most people would consider the management of early employees at successful startups to be "exploitative". Most of them are heavily incentivized.
There are specific issues with the worker models of Uber et al, but that's an orthogonal point to the general formation of startups.
There are specific issues with the worker models of Uber et al, but that's an orthogonal point to the general formation of startups.
For ultra successful startups, sure everyone gets rich.
I think the issue is with the 95% of startups that have no or moderate success who convince employees that lotto ticket equity and beanbag chairs are worth more than work-life balance, healthcare, and cold hard cash.
I think the issue is with the 95% of startups that have no or moderate success who convince employees that lotto ticket equity and beanbag chairs are worth more than work-life balance, healthcare, and cold hard cash.
He's implying that workers should work hard and give all the earnings and IP to the govt so they can "redistribute" and "rehire" for communal good.
> Are you implying that startup success in America requires exploitation of workers? I don't think most people would consider the management of early employees at successful startups to be "exploitative". Most of them are heavily incentivized.
This statement perfectly encapsulates the difference in work culture from the US and Europe. Exploitation doesn't happen because successes exist. You can get rich, so everything is allowed.
Having less social nets and having more startups aren't independent: they both result from an inherently risk taker culture.
(of course, all generalizations are limited and may not apply to all cases)
This statement perfectly encapsulates the difference in work culture from the US and Europe. Exploitation doesn't happen because successes exist. You can get rich, so everything is allowed.
Having less social nets and having more startups aren't independent: they both result from an inherently risk taker culture.
(of course, all generalizations are limited and may not apply to all cases)
That's the wrong framing. I suspect the reality is that many 20th century European law-books were written to protect workers and state from exploitative/criminal business owners. Rightly so.
It's an accident that the most important bits of corporate and labor law don't distinguish between a 300-person shoe factory and a 20-person series-A startup. They weren't around when these concepts were codified and written in stone. The systemic and personal consequences are unfortunate but impossible to prevent.
It's an accident that the most important bits of corporate and labor law don't distinguish between a 300-person shoe factory and a 20-person series-A startup. They weren't around when these concepts were codified and written in stone. The systemic and personal consequences are unfortunate but impossible to prevent.
1) Less upside for entrepreneurs/investors/early employees due to tax policy,
2) greater hiring/firing friction due to stronger employee protections,
3) greater fixed operating costs/overhead all around due to increased incorporation costs/bureaucratic requirements.
I don't think these things are necessarily negative, but in a world with competition between markets with high incorporation friction and low incorporation friction you'd expect entrepreneurship to concentrate in lower friction markets.
2) greater hiring/firing friction due to stronger employee protections,
3) greater fixed operating costs/overhead all around due to increased incorporation costs/bureaucratic requirements.
I don't think these things are necessarily negative, but in a world with competition between markets with high incorporation friction and low incorporation friction you'd expect entrepreneurship to concentrate in lower friction markets.
I can't speak for Europe, just for Canada, but I assume that a similar dynamic might exist. "Less upside" for successful founders due to taxes is frequently cited but I seriously doubt it. Instead, less risk appetite in the investment community is far more likely. Investors offer less money, with far more strings attached, and so founders move to the US to seek better investment terms. Taxes are a distant afterthought.
If taxes affect upside for investors (especially in large gain outcomes) then it would definitely reduce rational risk appetite.
Say it's rational for some untaxed investor to take a chance on 1% on no less than $10M return. If after taxes somewhere that turns into a $5M outcome then you would need a 2% chance for equivalent expected value.
Say it's rational for some untaxed investor to take a chance on 1% on no less than $10M return. If after taxes somewhere that turns into a $5M outcome then you would need a 2% chance for equivalent expected value.
Framed another way, perhaps the existence of strong social safety nets is evidence of cultures that discourage behavior and ideologies that encourage entrepreneurship.
Even in the United States the conditions for a startup ecosystem to thrive are localized mostly to California, both financially and culturally. Risk intolerance and shortness of ambition is pervasive in our society too, just that a few historical factors have allowed for a business counterculture to thrive in parts of it.
Even in the United States the conditions for a startup ecosystem to thrive are localized mostly to California, both financially and culturally. Risk intolerance and shortness of ambition is pervasive in our society too, just that a few historical factors have allowed for a business counterculture to thrive in parts of it.
Maybe I'm wrong, but isn't California one of the more progressive states with a stronger social safety net than say Arkansas or Alabama? So isn't that counter to your argument?
There is no meaningful safety net in California compared to European nation. They have a few more worker protections and a higher minimum wage, but it's not like they have socialized medicine.
It's better than the states that actively work to harm their citizens but that's not saying much.
It's better than the states that actively work to harm their citizens but that's not saying much.
> Even in the United States the conditions for a startup ecosystem to thrive are localized mostly to California, both financially and culturally.
I largely agree with this, and I (mostly) love California for many of these traits.
That said, I think startup ecosystem 2.0 will be centered around Austin. It will look very different than the California startup scene, but it will be just as transformative (if not moreso) imho.
I largely agree with this, and I (mostly) love California for many of these traits.
That said, I think startup ecosystem 2.0 will be centered around Austin. It will look very different than the California startup scene, but it will be just as transformative (if not moreso) imho.
> That said, I think startup ecosystem 2.0 will be centered around Austin. It will look very different than the California startup scene, but it will be just as transformative (if not moreso) imho.
I've heard that before. "look at X, it's the Next Silicon Valley".
Every time, it was someone trying to sell me something [0] and every time the correct move has been to keep investments in the Valley.
Maybe this time it'll be different.
[0] https://en.wikipedia.org/wiki/List_of_technology_centers
I've heard that before. "look at X, it's the Next Silicon Valley".
Every time, it was someone trying to sell me something [0] and every time the correct move has been to keep investments in the Valley.
Maybe this time it'll be different.
[0] https://en.wikipedia.org/wiki/List_of_technology_centers
> I've heard that before. "look at X, it's the Next Silicon Valley".
Yeah. I don’t think it will be the next Silicon Valley. I do think it will be the center of startup ecosystem 2.0.
I personally think the biggest difference in startup ecosystem 2.0 will be the lack of Silicon Valley-style VCs. Whatever money is used to fuel the fly wheel will have a fundamentally different approach to investing, at least in the beginning.
I’m not sure what your investments are, but if SV works for you, then stick with it. The startup ecosystem 2.0 probably will not be a good fit for you or them.
Yeah. I don’t think it will be the next Silicon Valley. I do think it will be the center of startup ecosystem 2.0.
I personally think the biggest difference in startup ecosystem 2.0 will be the lack of Silicon Valley-style VCs. Whatever money is used to fuel the fly wheel will have a fundamentally different approach to investing, at least in the beginning.
I’m not sure what your investments are, but if SV works for you, then stick with it. The startup ecosystem 2.0 probably will not be a good fit for you or them.
> I personally think the biggest difference in startup ecosystem 2.0 will be the lack of Silicon Valley-style VCs. Whatever money is used to fuel the fly wheel will have a fundamentally different approach to investing, at least in the beginning.
Where are they going to get investments from?
Where are they going to get investments from?
> Where are they going to get investments from?
Great question.
Probably people and organizations who are not looking for a typical SV portfolio (essentially many strike outs and a few home runs that are determined over a specific and relatively short timeline).
SV VCs started out as financiers that were supplying a lot of capital to start capital-intensive businesses (e.g., chip fabs). They are still largely designed to do that, but many businesses can be started and often grown with relatively small amounts of capital. These cheap-to-start businesses are often not served well by the SV VC model.
Some ideas:
1. The companies that are looking to control a complete market will still go to SV VCs.
2. For the companies whose business model doesn’t match the SV VC model, they will go elsewhere. They are doing it now. Specifically, some companies may be capped at growth due to the market size, the nature of the market, etc. When these companies use SG VC, they usually end up just fizzling out, even though the company could have been viable and stable at a small market cap (specifically, a number that would not move VC overall returns but would be large for most founders).
3. I expect the money will come from people and organizations that are happy with consistent, long-term, above average returns — basically focusing on more singles and doubles rather than home runs (to continue the baseball analogy). This might mean more debt rather than equity (unless a company chooses to go public). This might mean that institutional investors could struggle to find a single place or set of places to park large chunks of their money. This might mean that the investors play a key role in the business (e.g., a payment processor supplying short term loans based on historical cash flow).
4. Some of SV’s largest funders (LPs) may find themselves struggling to have significant access to this market, at least at first. Many of the companies and people who are in the best place to make these investments don’t need their money to participate. This could change — for example, payment processors could open up tranches of debt for companies that use their service, or private equity could end up taking a more proactive role in buying and developing businesses. It’s tough to say.
5. If I had to take a stab at what the “end game” of startup ecosystem 2.0 looks like, I would guess that most of these startups remain founder-led until exit. Exits will be relatively small (9 digits or less, usually less). Startups will be purchased by PE and will be developed and flipped. At some point in the chain, the amount of money involved will be high enough to involve substantial institutional money, and the institutional money will get involved though some sort of PE vehicle.
Note that #5 isn’t exactly original — it’s happening now with some PE firms. The main differences I see is that viable small companies won’t be run into the ground trying to hit home runs, and PE will be much more proactive in business building from a much earlier stage.
To build on my original response… why Austin?
- Plenty of land to expand still. This means affordable housing somewhere near Austin should be possible for a long while.
- A great university with a solid engineering department is nearby.
- No state taxes (big strike against CA).
- Interesting city center that is walkable/bikeable if you choose to live there. Overall metropolitan area is desirable — people have been gravitating there for decades now.
- Moderate weather for most of the year (summers are rough but manageable). Definitely not California good, but definitely not Northeast bad either.
- A relatively quiet tech scene that has been growing for decades that can supply mentorship, contacts, and (if necessary) money.
Great question.
Probably people and organizations who are not looking for a typical SV portfolio (essentially many strike outs and a few home runs that are determined over a specific and relatively short timeline).
SV VCs started out as financiers that were supplying a lot of capital to start capital-intensive businesses (e.g., chip fabs). They are still largely designed to do that, but many businesses can be started and often grown with relatively small amounts of capital. These cheap-to-start businesses are often not served well by the SV VC model.
Some ideas:
1. The companies that are looking to control a complete market will still go to SV VCs.
2. For the companies whose business model doesn’t match the SV VC model, they will go elsewhere. They are doing it now. Specifically, some companies may be capped at growth due to the market size, the nature of the market, etc. When these companies use SG VC, they usually end up just fizzling out, even though the company could have been viable and stable at a small market cap (specifically, a number that would not move VC overall returns but would be large for most founders).
3. I expect the money will come from people and organizations that are happy with consistent, long-term, above average returns — basically focusing on more singles and doubles rather than home runs (to continue the baseball analogy). This might mean more debt rather than equity (unless a company chooses to go public). This might mean that institutional investors could struggle to find a single place or set of places to park large chunks of their money. This might mean that the investors play a key role in the business (e.g., a payment processor supplying short term loans based on historical cash flow).
4. Some of SV’s largest funders (LPs) may find themselves struggling to have significant access to this market, at least at first. Many of the companies and people who are in the best place to make these investments don’t need their money to participate. This could change — for example, payment processors could open up tranches of debt for companies that use their service, or private equity could end up taking a more proactive role in buying and developing businesses. It’s tough to say.
5. If I had to take a stab at what the “end game” of startup ecosystem 2.0 looks like, I would guess that most of these startups remain founder-led until exit. Exits will be relatively small (9 digits or less, usually less). Startups will be purchased by PE and will be developed and flipped. At some point in the chain, the amount of money involved will be high enough to involve substantial institutional money, and the institutional money will get involved though some sort of PE vehicle.
Note that #5 isn’t exactly original — it’s happening now with some PE firms. The main differences I see is that viable small companies won’t be run into the ground trying to hit home runs, and PE will be much more proactive in business building from a much earlier stage.
To build on my original response… why Austin?
- Plenty of land to expand still. This means affordable housing somewhere near Austin should be possible for a long while.
- A great university with a solid engineering department is nearby.
- No state taxes (big strike against CA).
- Interesting city center that is walkable/bikeable if you choose to live there. Overall metropolitan area is desirable — people have been gravitating there for decades now.
- Moderate weather for most of the year (summers are rough but manageable). Definitely not California good, but definitely not Northeast bad either.
- A relatively quiet tech scene that has been growing for decades that can supply mentorship, contacts, and (if necessary) money.
You probably need more than one great university nearby.
SV has Stanford, Berkeley, and San Jose State. You may not have heard of SJS, but there are more (local) Apple employees who graduated from SJS than from Stanford and Berkeley.
FWIW, Stanford is relatively small. Berkeley's freshman class is larger than Stanford's entire undergraduate program.
SV has Stanford, Berkeley, and San Jose State. You may not have heard of SJS, but there are more (local) Apple employees who graduated from SJS than from Stanford and Berkeley.
FWIW, Stanford is relatively small. Berkeley's freshman class is larger than Stanford's entire undergraduate program.
> You probably need more than one great university nearby.
Texas A&M and Baylor are probably close enough to be within the Austin sphere, certainly if the Austin metro area expands.
Rice, University of Houston, Trinity, SMU, etc. are also in the broader halo.
Texas A&M and Baylor are probably close enough to be within the Austin sphere, certainly if the Austin metro area expands.
Rice, University of Houston, Trinity, SMU, etc. are also in the broader halo.
I don't think many people want to move to Texas, for instance abortion is illegal in the state. I doubt people want to move back to the 1950s, certainly not startup people, who tend to be more progressive. I personally would never want to move to Texas.
Texas was the 3rd fastest growing state in the country according to the recent census [0] so clearly many people are fine moving to Texas. And abortion at the state level is not something I would even consider in my list of priorities when choosing where to live when you can just drive to another state for a once in a lifetime event if you ever actually needed one.
[0]: https://www.aarp.org/politics-society/government-elections/i...
[0]: https://www.aarp.org/politics-society/government-elections/i...
> I don't think many people want to move to Texas, for instance abortion is illegal in the state. I doubt people want to move back to the 1950s, certainly not startup people, who tend to be more progressive. I personally would never want to move to Texas.
I’m guessing you’re European based on your business. Do you live in the US?
I’m guessing you don’t know many people who live in Texas, especially Austin. Startup people and companies are flocking to Austin.
Texas politics are weird because the Republicans have gerrymandered the state to a comical level. It’s allowed to persist because none of the bodies that can serve as a check and balance are doing any checking or balancing (failure of US democracy, imho).
I would not consider what is happening there representative of Texas as a whole, and especially not representative of Austin. The overall feeling of the state is moderate with a wide range of perspectives (like most populous states). The elites, however, are very conservative.
A change in Texas politics/politicians will come at some point, and when it comes, it will be swift. I am not convinced that the politicians in Texas are particularly representative of the people, but they are highly representative of the special interests of the state.
I’m guessing you’re European based on your business. Do you live in the US?
I’m guessing you don’t know many people who live in Texas, especially Austin. Startup people and companies are flocking to Austin.
Texas politics are weird because the Republicans have gerrymandered the state to a comical level. It’s allowed to persist because none of the bodies that can serve as a check and balance are doing any checking or balancing (failure of US democracy, imho).
I would not consider what is happening there representative of Texas as a whole, and especially not representative of Austin. The overall feeling of the state is moderate with a wide range of perspectives (like most populous states). The elites, however, are very conservative.
A change in Texas politics/politicians will come at some point, and when it comes, it will be swift. I am not convinced that the politicians in Texas are particularly representative of the people, but they are highly representative of the special interests of the state.
At least for France, there is less to recommend doing a startup than in the US. The social security regime is worse (than for others eg employees, govt workers), the tax schemes are complex and penalizing at the low end, and the amount a company has to pay an employee is near double what the employee sees in the bank, because near half goes to support the social security net. I’ve been here a decade and wouldn’t start one, even after doing autoentrepreneur unless it was the only choice.
> and the amount a company has to pay an employee is near double what the employee sees in the bank, because near half goes to support the social security net
In dollar values, in the US, that same amount will go to pay for health insurance and benefits and social security and medicare taxes. Combined with lower wages, and your overall payroll expenses will still be much lower in France.
There aren't a lot of senior engineers making north of $300,000 USD/year in France. But there are a lot in SV.
In dollar values, in the US, that same amount will go to pay for health insurance and benefits and social security and medicare taxes. Combined with lower wages, and your overall payroll expenses will still be much lower in France.
There aren't a lot of senior engineers making north of $300,000 USD/year in France. But there are a lot in SV.
If you’re stuck in France, could you not start a company anyway and only hire remote workers from outside of France?
My not-very researched take: entrepreneurship is a game played mostly by people from already wealthy families. Since the % of wealthy people in the US is higher, and their rich are richer, you get more "initially rich" entrepreneurs.
Interesting take but how do you explain almost half of all companies being founded by immigrants or their children?
Are those poor immigrants, or rich immigrants?
A lot more than half of Americans, if they were born in another country, would not be allowed to immigrate to the US under modern immigration policies.
Most immigrants have to undergo an extremely strong selection filter, before they are allowed in. It would be truly surprising if they weren't more successful on a per-capita basis.
Most immigrants have to undergo an extremely strong selection filter, before they are allowed in. It would be truly surprising if they weren't more successful on a per-capita basis.
I'd guess a lot of it is cultural - I believe much of Europe also has a far less workaholic culture than the US, with more emphasis on living life and whatnot. And I'm sure there are other factors (France's labor laws presumably make things harder, although that's a barely informed guess on my part).
Like others mention, while you might not be on the hook for huge hospital bills there are other parts of the safety net that are more or less denied to you.
Myself I ran into "problems" when it came to parental leave, parents in Sweden usually gets a combined 480 days of parental leave, of which about 360 are at 80% of your income levels.
Problem is that if you (like me) plan on bootstrapping something then you're not taking out salary during that period, so even if you paid a lot of money in taxes the year before you still get marked down as a zero-earner if you plan to take time off with your kids.
Luckily the Swedish govt realized that this hurts things in the long term so they actually relaxed the rules in this area so you can retain your previous income levels for 3 years if you want to take advantage of parental leave.
(Not entirely sure if they fixed this if you get sick though, regular employees that get sick can retain most of their income for a while but not entirely sure if these 3 years startup grace period applies when getting sick)
Myself I ran into "problems" when it came to parental leave, parents in Sweden usually gets a combined 480 days of parental leave, of which about 360 are at 80% of your income levels.
Problem is that if you (like me) plan on bootstrapping something then you're not taking out salary during that period, so even if you paid a lot of money in taxes the year before you still get marked down as a zero-earner if you plan to take time off with your kids.
Luckily the Swedish govt realized that this hurts things in the long term so they actually relaxed the rules in this area so you can retain your previous income levels for 3 years if you want to take advantage of parental leave.
(Not entirely sure if they fixed this if you get sick though, regular employees that get sick can retain most of their income for a while but not entirely sure if these 3 years startup grace period applies when getting sick)
In general, as an individual entrepreneur/'business owner'/selbstandiger in germany, and also in the US, its neigh impossible in Germany to perform your own accounting/tax filings; and the idea of an LLC is very difficult to obtain (see how companies like Starbucks structure their limited liability with an 'AG & Co. KG')
Combine this with the lack of 'safety net' for someone who owns the business (you dont qualify the same as if you were a regular non participatory employee) and the lack of angel funding/froth in general... its not as simple as you may imagine, especially for non citizens.
Its possible, but its not as simple :)
Edit typo
Combine this with the lack of 'safety net' for someone who owns the business (you dont qualify the same as if you were a regular non participatory employee) and the lack of angel funding/froth in general... its not as simple as you may imagine, especially for non citizens.
Its possible, but its not as simple :)
Edit typo
Paying private health insurance and pension is, inalmost all cases, better for an internationally mobile founder anyway!
Europe has very progressive policies on some level, but also very regressive or unfriendly policies for business owners. Classic example is bankruptcy. In the US, chapter 11 is done as an almost routine "get me out of debt". This was impossible in Europe until very recently (EU Restructuring Directive, July 2021 was the deadline to implement).
Personal bankruptcy is another good example where Europe just has no equivalent.
Personal bankruptcy is another good example where Europe just has no equivalent.
In the UK personal bankruptcy costs £680 and is normally discharged after twelve months. Is the US less onerous than that?
If I didn't have a ton of debt, I'd probably need a particularly intense desire for material wealth or financial independence in order to drive me into business. I don't currently have a ton of debt, just a bit, and I'd like to get rid of it, but beyond that I'm not terribly interested in the bullshit products and crap most people spend all their money on. Therefore, money itself isn't motivating enough to sacrifice so much for it. Likewise, arguments about changing the world are hollow at best most of the time, and overall those claims by previous companies have arguably worsened the world more than helped it.
If you push enough people off a cliff some of them will learn to swim. If you don't push people off a cliff only those that think they'll be able to swim may jump.
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I‘d argue that it‘s not a paradox . It‘s actually the same thing:
People in Europe seem to be more focused on what is deemed „safe“. Parents don‘t want their kids to become „entrepreneurs“ - they want them to find a „safe job“.
I‘m sure that many parents in the U.S. want that, too, for their children. But the U.S. is a country that was founded by immigrants. By people who, in the very founding of the country, broke with old traditions and with the „normal way“ of doing things.
Another commenter mentioned that many startups seem to be headed by immigrants, or that many of the „big guys“ in Silicon Valley started out as such (PayPal Mafia, Google guys, WhatsApp...). It‘s the same thing: You need to break with tradition to become an entrepreneur.
So, in a sense, you need to be standing a little „outside“ of the society in which you are moving. People who visit Europe from the U.S. often notice that Europeans tend to seem less open to random encounters with strangers, and that they tend to hang out in tight-nit social groups.
This is, of course, a generalization. But having lived both in Germany and in California I see this as an accurate description.
And I would argue that it‘s a lot harder to do a startup when you‘re inside a tight-knit social circle, where you have to explain yourself, where you face embarrassment if you fail, and where people might say „Who do you think you are, founding your own company?“.
It‘s a lot easier to do that if you, as Steve Jobs once famously said, have freed yourself from the concept that you must do what you are told, and should not bump into the walls too much (i.e. the „rules“ according to which society claims to work). After all, a real startup is an entity designed to break some of those rules, and to replace them with new ones.
Also, it seems to me that Europeans and Americans (especially Californians, East Coasters and Austiners) differ in where they seek salvation from their problems:
In Europe, I would argue, it is still very much more the politicians and the state. And I do not think this is the case as much in those areas of the U.S.. Again, the observations of a better social security net on the one hand and a lagging behind in entrepreneurship seem to me not to be a contradiction, but two sides of the same thing.
That idea that you can fix what you see as broken by doing a startup is slowly becoming a lot more mainstream in Europe, for sure. But, I think, for Europeans this is more a learned behavior, something inspired by what they see in Silicon Valley and in entrepreneurship shows as „Dragon‘s Den“, whereas in the U.S., it‘s always been a way of life and a philosophy for at least some substantial part of the population.
Do not forget, also, that many countries in Europe were dictatorships just two generations before. In Germany, half of the country lived in socialism up until my parent‘s generation.
In such an environment, you do not raise your kids to take risks, to put yourself in the spotlight, or to change the lives of others. And these values of „being safe“ and „fitting in“, they filter down, from grandparents, to parents, to children. It takes generations for them to die out. So there‘s that, too.
People in Europe seem to be more focused on what is deemed „safe“. Parents don‘t want their kids to become „entrepreneurs“ - they want them to find a „safe job“.
I‘m sure that many parents in the U.S. want that, too, for their children. But the U.S. is a country that was founded by immigrants. By people who, in the very founding of the country, broke with old traditions and with the „normal way“ of doing things.
Another commenter mentioned that many startups seem to be headed by immigrants, or that many of the „big guys“ in Silicon Valley started out as such (PayPal Mafia, Google guys, WhatsApp...). It‘s the same thing: You need to break with tradition to become an entrepreneur.
So, in a sense, you need to be standing a little „outside“ of the society in which you are moving. People who visit Europe from the U.S. often notice that Europeans tend to seem less open to random encounters with strangers, and that they tend to hang out in tight-nit social groups.
This is, of course, a generalization. But having lived both in Germany and in California I see this as an accurate description.
And I would argue that it‘s a lot harder to do a startup when you‘re inside a tight-knit social circle, where you have to explain yourself, where you face embarrassment if you fail, and where people might say „Who do you think you are, founding your own company?“.
It‘s a lot easier to do that if you, as Steve Jobs once famously said, have freed yourself from the concept that you must do what you are told, and should not bump into the walls too much (i.e. the „rules“ according to which society claims to work). After all, a real startup is an entity designed to break some of those rules, and to replace them with new ones.
Also, it seems to me that Europeans and Americans (especially Californians, East Coasters and Austiners) differ in where they seek salvation from their problems:
In Europe, I would argue, it is still very much more the politicians and the state. And I do not think this is the case as much in those areas of the U.S.. Again, the observations of a better social security net on the one hand and a lagging behind in entrepreneurship seem to me not to be a contradiction, but two sides of the same thing.
That idea that you can fix what you see as broken by doing a startup is slowly becoming a lot more mainstream in Europe, for sure. But, I think, for Europeans this is more a learned behavior, something inspired by what they see in Silicon Valley and in entrepreneurship shows as „Dragon‘s Den“, whereas in the U.S., it‘s always been a way of life and a philosophy for at least some substantial part of the population.
Do not forget, also, that many countries in Europe were dictatorships just two generations before. In Germany, half of the country lived in socialism up until my parent‘s generation.
In such an environment, you do not raise your kids to take risks, to put yourself in the spotlight, or to change the lives of others. And these values of „being safe“ and „fitting in“, they filter down, from grandparents, to parents, to children. It takes generations for them to die out. So there‘s that, too.
in europe, you cannot file for personal bankrupcy. you will be stuck with debt forever.
This is complete nonsense. I don't know where you picked that up but wherever you did it isn't true.
That’s categorically not true. For example, in the UK you can file for bankruptcy[1] and in Sweden you can apply through Kronofogden to have personal debts cancelled after a supervised three year period.
[1] https://www.gov.uk/bankruptcy
[1] https://www.gov.uk/bankruptcy
Slight correction, In Sweden you can apply for "debt-sanitation" from Kronofogden, it requires you to pay all earned money above an level called "existential minimum" for _5_ years (ie you'll live as a really "poor person").
After that point in time all the old debts are cleared off (although you might still be stuck with bad credit scores).
After that point in time all the old debts are cleared off (although you might still be stuck with bad credit scores).
ok, so not the same thing as in the US.
Not technically, but that's no surprise since the legal systems are different. In practice though it serves the same purpose of making individuals debt free (even if it forces one to go through dog years).
Iirc Bankruptcy is technically reserved for companies and other legal entities, and always either ends in reconstitution or liquidation depending on if a court appointed lawyer finds that there are funds, income or other means to continue operating, or if liquidation is the only way that creditors will receive anything back.
Iirc Bankruptcy is technically reserved for companies and other legal entities, and always either ends in reconstitution or liquidation depending on if a court appointed lawyer finds that there are funds, income or other means to continue operating, or if liquidation is the only way that creditors will receive anything back.
I really like that Rocket Investments group that just copies existing products and launches them in into LATAM/Emerging markets. I think this is a German group - does anyone have any info on them?
They are from berlin (rocket internet). Cant find it anywhere but heard a rumor they once sold a german ebay clone to Google for big $$$ by pretending to be a huge company. They hired a aircraft hangar for the occassion
wow, guess due diligence wasn't in fashion at the time
Headlines like this sound more like they're trying to convince the reader of something that isn't actually happening.
> Sequoia .. announced last year that it would open their first European office in London
Interesting since the UK left the EU. But I guess they like the banking environment there? Still, I expect quite some red tape if they actually want to invest in EU companies from there.
Interesting since the UK left the EU. But I guess they like the banking environment there? Still, I expect quite some red tape if they actually want to invest in EU companies from there.
Why would they want to invest in EU companies when 90% of EU innovation is based in London?
Communist europe's startups? All they ('companies') do is get free handouts from Brussels and govt agencies.
There have been grand total of two good companies worth anyone's pity have come from Netherlands, ASML and NXP both spinoffs/offshoots of Phillips.
The Netherlands is the last bastion of entreprenuership and innovation in deeply communist and anti-innovation, anti-rich and anti-prosperity EU.
Not sure how long before Netherlands nationalizes their big companies.
The Netherlands is the last bastion of entreprenuership and innovation in deeply communist and anti-innovation, anti-rich and anti-prosperity EU.
Not sure how long before Netherlands nationalizes their big companies.