3 ms·

Or in other words, diversity in cultures and languages that isn't as prominent in the US. The US has 350 million people with one language and a general shared c

by CM30 10y ago

Or in other words, diversity in cultures and languages that isn't as prominent in the US. The US has 350 million people with one language and a general shared culture, Europe has 740 million people with tons of languages and very different cultures between them. But I think the article misses an important point. Namely access to venture capital money. Put it simply, it's much easier to raise a lot of money for a startup (especially an early stage one) in the US than in Europe. So European companies often operate on a shoestring budget in comparison to the US counterparts. Heck, many of investments I've seen for UK companies wouldn't pay for a single engineer in the valley. Or at best, they leave a lot less cash available for marketing later. Just seems like there's less access to money or a support network in Europe. So as a result, US startups can operate on a much larger scale.

Inthenameofmine 10y ago
Fully agreed. I work with several startups both US and EU side. I see 3 hurdles, all solvable: 1. No unified capital market and banking union, hence funding is restricted to per country Capital accumulation. 2. Still no unified digital products, payments, and IP market. The cost of selling any sort of IP in the EU is orders of magnitude higher than in the US. 3. Most countries have some sort of ridiculous immigration and work permit regulation, hindering startups to hire people easily and from anywhere. At this point it is easier for somebody from the EU to incorporate remotely in Delaware, setup a bank account through Atlas Stripe, do fundraising in the US through Angellist, hire globally through any number of online platforms, and close deals with ready made YCombinator SAFE notes, and travel with a visa waiver every quarter cheaply to the US, than to even try incorporation in the EU.
- k-mcgrady 10y ago
  >> At this point it is easier for somebody from the EU to incorporate remotely in Delaware, setup a bank account through Atlas Stripe, do fundraising in the US through Angellist, hire globally through any number of online platforms, and close deals with ready made YCombinator SAFE notes, and travel with a visa waiver every quarter cheaply to the US, than to even try incorporation in the EU. Maybe you can go into this in more detail because my understanding below seems pretty simple: 1. Register an LTD company in the UK online, in minutes, for £20 through the government website. 2. Hire anyone that lives in the EU with very little restrictions or paperwork. I don't see why most companies would need to hire from outside the EU and that is a huge talent pool.
  - Silhouette 10y ago
    Hire anyone that lives in the EU with very little restrictions or paperwork. Hiring anyone at all is a significant hurdle in much of the EU, whether it's from your home nation or another member state. If we're talking about startups just starting to grow beyond the founders here, you're not going to have anyone on board yet who is dedicated to dealing with HR, legal and payroll issues. Those won't necessarily be a full-time job with employee #1 either, but they're already a significant overhead the moment you start looking to hire that person, and if anything unusual or adversarial happens it can quickly become an actual full-time job.
    - Dutchie 10y ago
      So don't hire them. Let a payrolling company officially hire them. The payrolling company sends you a monthly invoice and takes care of all the legal stuff. I'm currently doing this in the Netherlands, and it's totally legal.
      - Silhouette 10y ago
        Here in the UK, there are also a lot of rules around intermediaries and agency workers.
    - k-mcgrady 10y ago
      >> "HR, legal and payroll issues" These aren't issues for US based companies?
      - Silhouette 10y ago
        I'm sure they are, but as I understand it, the amount of regulation involved in most of Europe compared to the US is on an entirely different level. For example, in much of the US, employment is typically at-will. Make a bad hire, or simply change direction so an early hire is no longer a good fit, and you have minimal obligations. In much of Europe, employment immediately or almost immediately involves things like not being able to fire someone without being able to show they are either genuinely redundant or not just really bad at their job but also not capable of improvement to the point they could be useful. Obviously there are issues of employee protection and fair employment contracts to consider as well, but it's hardly surprising that given the very different employment relationships either side of the Atlantic, small US businesses thinking about taking on their first employees can be much more liberal in hiring new staff because they have much less commitment.
andreasklinger 10y ago
Imo the reason why there is less access to capital is the same why there are less fast growing europe wide companies. Game dynamics of slower/limited upsides.

by CM30 10y ago

Inthenameofmine 10y ago

Fully agreed. I work with several startups both US and EU side. I see 3 hurdles, all solvable: 1. No unified capital market and banking union, hence funding is restricted to per country Capital accumulation. 2. Still no unified digital products, payments, and IP market. The cost of selling any sort of IP in the EU is orders of magnitude higher than in the US. 3. Most countries have some sort of ridiculous immigration and work permit regulation, hindering startups to hire people easily and from anywhere. At this point it is easier for somebody from the EU to incorporate remotely in Delaware, setup a bank account through Atlas Stripe, do fundraising in the US through Angellist, hire globally through any number of online platforms, and close deals with ready made YCombinator SAFE notes, and travel with a visa waiver every quarter cheaply to the US, than to even try incorporation in the EU.

k-mcgrady 10y ago
>> At this point it is easier for somebody from the EU to incorporate remotely in Delaware, setup a bank account through Atlas Stripe, do fundraising in the US through Angellist, hire globally through any number of online platforms, and close deals with ready made YCombinator SAFE notes, and travel with a visa waiver every quarter cheaply to the US, than to even try incorporation in the EU. Maybe you can go into this in more detail because my understanding below seems pretty simple: 1. Register an LTD company in the UK online, in minutes, for £20 through the government website. 2. Hire anyone that lives in the EU with very little restrictions or paperwork. I don't see why most companies would need to hire from outside the EU and that is a huge talent pool.
- Silhouette 10y ago
  Hire anyone that lives in the EU with very little restrictions or paperwork. Hiring anyone at all is a significant hurdle in much of the EU, whether it's from your home nation or another member state. If we're talking about startups just starting to grow beyond the founders here, you're not going to have anyone on board yet who is dedicated to dealing with HR, legal and payroll issues. Those won't necessarily be a full-time job with employee #1 either, but they're already a significant overhead the moment you start looking to hire that person, and if anything unusual or adversarial happens it can quickly become an actual full-time job.
  - Dutchie 10y ago
    So don't hire them. Let a payrolling company officially hire them. The payrolling company sends you a monthly invoice and takes care of all the legal stuff. I'm currently doing this in the Netherlands, and it's totally legal.
    - Silhouette 10y ago
      Here in the UK, there are also a lot of rules around intermediaries and agency workers.
  - k-mcgrady 10y ago
    >> "HR, legal and payroll issues" These aren't issues for US based companies?
    - Silhouette 10y ago
      I'm sure they are, but as I understand it, the amount of regulation involved in most of Europe compared to the US is on an entirely different level. For example, in much of the US, employment is typically at-will. Make a bad hire, or simply change direction so an early hire is no longer a good fit, and you have minimal obligations. In much of Europe, employment immediately or almost immediately involves things like not being able to fire someone without being able to show they are either genuinely redundant or not just really bad at their job but also not capable of improvement to the point they could be useful. Obviously there are issues of employee protection and fair employment contracts to consider as well, but it's hardly surprising that given the very different employment relationships either side of the Atlantic, small US businesses thinking about taking on their first employees can be much more liberal in hiring new staff because they have much less commitment.

andreasklinger 10y ago

Imo the reason why there is less access to capital is the same why there are less fast growing europe wide companies. Game dynamics of slower/limited upsides.