5 ms·

A more interesting question is: 'Are unicorns good for the economy and good for society'?

hodwik 11y ago
Why is that the more interesting question? Is there anything you can add to the discussion of substance? Or, perhaps, is this drive-by FUD all you have in the content holster?
- adaml_623 11y ago
  Ok you have a valid point but since the article is full of kind of wishy washy questions I didn't feel guilty about adding some more into the mix. The title 'Why is Europe Failing to Create More Unicorns?' has an implicit bias in it. The question is saying that Europeans should create more of these massive new companies. 10 smaller companies might be better than 1 big company. 100 companies worth $10 million dollars each might provide the same number of jobs and the same services to the economy. Maybe? Admittedly if you listen to European entrepreneurs you can't come away and believe that everything is rosy for new businesses.
  - ThomPete 11y ago
    Thats not what I am saying at all though. In fact I am very open in the essay to the question as to whether it's even something you would want. But the fact is that they have an effect on the world outside the US. Perhaps you are fine with that, I would love to see some more Europeans get into the game if nothing else to boost morality and have more people try and create companies.
    - rjsw 11y ago
      Your essay does suggest to me that you think that companies like Uber and AirBnb are a good thing though. If a proportion of those europeans who could run startups hold back from following certain business models then you will get fewer startups overall.
      - ThomPete 11y ago
        I guess I can always keep rewriting it in every paragraph, but I tried to be up front because I knew some would interpret it like that. This is why I wrote: Before you read on: This is a complex issue and I don’t claim to have the answers. In fact it’s going to ask more questions than it answers and I wasn’t even sure I wanted to publish it. It’s not even obvious why chasing unicorns is such a good idea. In the beginning and: Unicorns might not be what Europe want and we might all agree it’s an unsustainable model. in the end. Not sure how much more I could have done before someone started complaining that i was repeating myself :)
  - robwilliams 11y ago
    >10 smaller companies might be better than 1 big company. 100 companies worth $10 million dollars each might provide the same number of jobs and the same services to the economy. I'm not sure what point you're trying to make. It's beneficial that Airbnb is so big because I can plan a cross-continent vacation using one website instead of searching for each city's/country's version of it (which may have poor customer service or be ran by scammers). It's beneficial that Uber is so big because I can use one app to summon a car anywhere around the world instead of having to install a new app in every city/state/country. Just because 10 companies could provide the same amount of service and jobs doesn't mean that it's beneficial to customers. The question the OP is addressing is about growth limits in Europe, not about the moral value of large companies. EDIT: I am not arguing for monopolies. Multiple companies with service around the world can and do compete.
    - kragen 11y ago
      If the ten companies interoperated, you could plan a cross-continent vacation using one website instead of searching for each city's/country's version of it. (And then you wouldn't be vulnerable to Airbnb, for example, demanding access to your Google Docs metadata in order to allow you to continue using their service.) You're making the argument that people used to make about how it would be impractical to have multiple long-distance phone companies or multiple long-distance computer networking companies.
      - hodwik 11y ago
        This is nothing like the phone lines -- the FCC isn't going to come in and force them to play nice, and these companies are not going to do it out of the goodness of their hearts. The big players will just starve out the little ones. AirBNB isn't infrastructure, it's a service. Without a complete socialist re-imagining of society, that will never happen.
        kragen 11y ago
        The FCC isn't forcing Level3 or Global Exchange or AOL to "play nice" either. You're apparently arguing from a complete ignorance of history, and consequently your prescribed remedy is likely to make the situation worse instead of better.
  - briandear 11y ago
    Little companies are rarely disruptive and disruption is what creates value and drives society forward.
    - hodwik 11y ago
      Exactly, R&D requires capital. Capital comes from profits. Overly competitive markets destroys profits, destroying capital. Thus too much competition destroys R&D. Look at the airlines. There doesn't need to be this much competition in the airline industry (https://en.wikipedia.org/wiki/List_of_airlines https://en.wikipedia.org/wiki/List_of_airlines). They've had too many players for far too long, and it's caused them to compete to the bottom. Sure, flights are "cheap", but not as cheap as they would be if these companies could afford to upgrade their infrastructure, invest in more modernization efforts, and so on. In fact, the average airline makes about 1% return, or $100 in profit for every $10,000 they spend. That's not a recipe for a healthy business, or a healthy industry. By comparison, AMD and Intel have a duopoly on x86 processors and have for ages. Intel's profit margins waver between 1/4 and 1/3 of revenue. Simultaneously, processors get better and cheaper every single year.
    - bobthechef 11y ago
      Not true at all. Indeed, it's the little companies that often can be "disruptive" (I hate that word; why is disruption necessarily good?). Indeed, large companies are in practice often invested in ways that prevent them from pursuing profitable business that smaller business can. Their business model can prevent them from pursuing profitable business because it would involve biting the hand that feeds them. Large companies become entrenched in a certain set of ties and a certain status quo. The last thing they want is to disrupt. It's very much a question of trade offs. Aside from that, your phrase "drives society forward". I always here this phrase thrown around in these discussions, but I have yet to receive a coherent explanation of what that means, or what this great lord of Progress consists of. I think one ought to remember what the aim is. Change is not the same as "better", chaos is also change (the article says we fear change at its core, which I think is stupid; we fear loss of something which change can entail; some are addicted to change for its own sake out of from psychological illness). There is the social dimension to consider, the psychological, the spiritual, the environmental, etc. The empty profit seeking and vacuous worship of tech or whatever is desolate.
- dang 11y ago
  Please don't be personally abrasive on HN.
adventured 11y ago
Of course they are. Dramatically so. Are: eBay, Amazon, Google, Facebook, Uber, Priceline, Expedia, SpaceX, Tesla, PayPal, FirstSolar, GoPro, Salesforce, Workday, FireEye, Splunk, Netflix, Yahoo, Twitter, DropBox, Palantir, Pandora, etc. good for the US? They were all the equivalent of small unicorns once. So the question is: as opposed to what? All of those companies existing somewhere else, and most of the benefits going to other nations instead (jobs, taxes, investment, innovation)?

Why is that the more interesting question? Is there anything you can add to the discussion of substance? Or, perhaps, is this drive-by FUD all you have in the content holster?

adaml_623 11y ago
Ok you have a valid point but since the article is full of kind of wishy washy questions I didn't feel guilty about adding some more into the mix. The title 'Why is Europe Failing to Create More Unicorns?' has an implicit bias in it. The question is saying that Europeans should create more of these massive new companies. 10 smaller companies might be better than 1 big company. 100 companies worth $10 million dollars each might provide the same number of jobs and the same services to the economy. Maybe? Admittedly if you listen to European entrepreneurs you can't come away and believe that everything is rosy for new businesses.
- ThomPete 11y ago
  Thats not what I am saying at all though. In fact I am very open in the essay to the question as to whether it's even something you would want. But the fact is that they have an effect on the world outside the US. Perhaps you are fine with that, I would love to see some more Europeans get into the game if nothing else to boost morality and have more people try and create companies.
  - rjsw 11y ago
    Your essay does suggest to me that you think that companies like Uber and AirBnb are a good thing though. If a proportion of those europeans who could run startups hold back from following certain business models then you will get fewer startups overall.
    - ThomPete 11y ago
      I guess I can always keep rewriting it in every paragraph, but I tried to be up front because I knew some would interpret it like that. This is why I wrote: Before you read on: This is a complex issue and I don’t claim to have the answers. In fact it’s going to ask more questions than it answers and I wasn’t even sure I wanted to publish it. It’s not even obvious why chasing unicorns is such a good idea. In the beginning and: Unicorns might not be what Europe want and we might all agree it’s an unsustainable model. in the end. Not sure how much more I could have done before someone started complaining that i was repeating myself :)
- robwilliams 11y ago
  >10 smaller companies might be better than 1 big company. 100 companies worth $10 million dollars each might provide the same number of jobs and the same services to the economy. I'm not sure what point you're trying to make. It's beneficial that Airbnb is so big because I can plan a cross-continent vacation using one website instead of searching for each city's/country's version of it (which may have poor customer service or be ran by scammers). It's beneficial that Uber is so big because I can use one app to summon a car anywhere around the world instead of having to install a new app in every city/state/country. Just because 10 companies could provide the same amount of service and jobs doesn't mean that it's beneficial to customers. The question the OP is addressing is about growth limits in Europe, not about the moral value of large companies. EDIT: I am not arguing for monopolies. Multiple companies with service around the world can and do compete.
  - kragen 11y ago
    If the ten companies interoperated, you could plan a cross-continent vacation using one website instead of searching for each city's/country's version of it. (And then you wouldn't be vulnerable to Airbnb, for example, demanding access to your Google Docs metadata in order to allow you to continue using their service.) You're making the argument that people used to make about how it would be impractical to have multiple long-distance phone companies or multiple long-distance computer networking companies.
    - hodwik 11y ago
      This is nothing like the phone lines -- the FCC isn't going to come in and force them to play nice, and these companies are not going to do it out of the goodness of their hearts. The big players will just starve out the little ones. AirBNB isn't infrastructure, it's a service. Without a complete socialist re-imagining of society, that will never happen.
      - kragen 11y ago
        The FCC isn't forcing Level3 or Global Exchange or AOL to "play nice" either. You're apparently arguing from a complete ignorance of history, and consequently your prescribed remedy is likely to make the situation worse instead of better.
- briandear 11y ago
  Little companies are rarely disruptive and disruption is what creates value and drives society forward.
  - hodwik 11y ago
    Exactly, R&D requires capital. Capital comes from profits. Overly competitive markets destroys profits, destroying capital. Thus too much competition destroys R&D. Look at the airlines. There doesn't need to be this much competition in the airline industry (https://en.wikipedia.org/wiki/List_of_airlines https://en.wikipedia.org/wiki/List_of_airlines). They've had too many players for far too long, and it's caused them to compete to the bottom. Sure, flights are "cheap", but not as cheap as they would be if these companies could afford to upgrade their infrastructure, invest in more modernization efforts, and so on. In fact, the average airline makes about 1% return, or $100 in profit for every $10,000 they spend. That's not a recipe for a healthy business, or a healthy industry. By comparison, AMD and Intel have a duopoly on x86 processors and have for ages. Intel's profit margins waver between 1/4 and 1/3 of revenue. Simultaneously, processors get better and cheaper every single year.
  - bobthechef 11y ago
    Not true at all. Indeed, it's the little companies that often can be "disruptive" (I hate that word; why is disruption necessarily good?). Indeed, large companies are in practice often invested in ways that prevent them from pursuing profitable business that smaller business can. Their business model can prevent them from pursuing profitable business because it would involve biting the hand that feeds them. Large companies become entrenched in a certain set of ties and a certain status quo. The last thing they want is to disrupt. It's very much a question of trade offs. Aside from that, your phrase "drives society forward". I always here this phrase thrown around in these discussions, but I have yet to receive a coherent explanation of what that means, or what this great lord of Progress consists of. I think one ought to remember what the aim is. Change is not the same as "better", chaos is also change (the article says we fear change at its core, which I think is stupid; we fear loss of something which change can entail; some are addicted to change for its own sake out of from psychological illness). There is the social dimension to consider, the psychological, the spiritual, the environmental, etc. The empty profit seeking and vacuous worship of tech or whatever is desolate.
dang 11y ago
Please don't be personally abrasive on HN.

adventured 11y ago

Of course they are. Dramatically so. Are: eBay, Amazon, Google, Facebook, Uber, Priceline, Expedia, SpaceX, Tesla, PayPal, FirstSolar, GoPro, Salesforce, Workday, FireEye, Splunk, Netflix, Yahoo, Twitter, DropBox, Palantir, Pandora, etc. good for the US? They were all the equivalent of small unicorns once. So the question is: as opposed to what? All of those companies existing somewhere else, and most of the benefits going to other nations instead (jobs, taxes, investment, innovation)?