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Europe’s Startup Unicorns

ChuckNorris89 6y ago
Huh, looks more like London's Startup Unicorns on a first glance. Joke aside, can anyone explain to me why most startups there seem to be in the UK and so little in Germany or other countries? Genuinely curious, since the way I know my EU economics, is that Germany has a higher GDP than the UK.
- IndrekR 6y ago
  I can see in that list some that have HQ in London, but their origins and main teams are still in other countries. This is mostly due to investor's requirements to relocate.
- emredjan 6y ago
  I think it's related to risk-aversion of investors in EU. While spitting out millions of dollars anything with a slight chance of success is common in the US (and to some degree in UK apparently), EU investors are much more conservative in their spending, which affects the valuation of these companies.
- nivenkos 6y ago
  Other countries (e.g. Spain and Germany) have a lot more bureaucracy and fees around starting a company.
- toyg 6y ago
  Labour market and taxation are more flexible over here than on the continent. Also London was/is basically the financial capital of Europe, and the easiest destination for young talent for cultural reasons (it's easier for developers to learn English to a passable level than German, French, or less popular languages, when most of the ecosystem is built in and around English). This said, Berlin started later than London but, from what I hear, got much hotter in the last 5/10 years, so there might be some rebalancing in progress.
- nottorp 6y ago
  Here's a helper question: have you seen Bayer producing a Covid vaccine? Nope, they're happy producing aspirin. Less risk.
  - raverbashing 6y ago
    Well, Bayer doesn't produce vaccines. But yes, there is risk avoidance in the German market (but the language barriers kinda make some startups look "invisible" outside of their non-English speaking countries)
  - rsynnott 6y ago
    ... Of the major vaccines currently, Moderna was developed in the US, Pfizer/BioNTech in Germany (BioNTech, which developed it, is German), Oxford/AstraZeneca in the UK.
    - nottorp 6y ago
      BioNTech produced it but Pfizer financed it. And the Oxford one is in the UK where all the "unicorns" come from.
  - brmgb 6y ago
    Merck is currently testing two vaccine candidates (Sanofi is too actually). They started development later and took more time but when all will be said and done, I fully expect them to have shipped more vaccines than Moderna and Pfizer: mRNA-based vaccines have never been produced at scale and the logistic involved seems rather complexe. Merck and Sanofi are developing vaccines based on existing vectors. They can reach true mass production as soon as they get approved. It's the same thing for Johnson and Johnson actually. AstraZeneca has what I would call a true headstart however.
- geden 6y ago
  Germans less interested in moving fast and breaking things than Brits in my experience. Especially outside of Berlin.
LittlePeter 6y ago
Counts by country: 54 United Kingdom 18 Germany 14 France 8 Netherlands 6 Switzerland 4 Sweden 4 Spain 2 Romania 2 Norway 2 Lithuania 2 Finland 2 Estonia 2 Cyprus 2 Belgium United Kingdom is definitely over-represented. Bad sampling by Sifted? Or is the climate in UK genuinely more favorable to start-ups?
- varispeed 6y ago
  UK had great laws geared towards mobile workforce and specialist contractors could claim business costs against their tax - this combined with little bureaucracy and use of de facto lingua franca was a recipe for success. From April next year this will end as government was looking for extra money and decided to adjust IR35 (a law that essentially says if you work as an employee you should be taxed as employee, but without having any employment rights), so that now the client has to determine whether contractor is a deemed employee or not. The problem is that the penalty for doing wrong determination only exist if you declare that someone is not a deemed employee, but investigating civil servant finds the opposite. That means risk averse companies change their contracts so that the contractor will always be deemed an employee to avoid getting fined (the fine plus all taxes that would have to be paid even if contractor already paid all the taxes). This still wouldn't be a problem if the rules about deemed employment were clear - but after so many years HMRC still keep losing cases where they get the determination wrong themselves. What this means for contractors? They essentially become employees without rights and the effective tax rate they will pay may be even around 54% plus they won't be able to deduct any business expenses (except what employee could have deducted - but that is essentially dead). Suddenly the market for IT specialists in the UK became unattractive and companies who are struggling to find people working for severe pay cut start to look overseas. edit: if you want more spice to this, then imagine that our Chancellor is married to woman that her and her father have substantial stake in Infosys.
  - MrBuddyCasino 6y ago
    Same development as in Germany, its getting harder for freelancers. They say its for "protecting workers", but it really is about funding for social security systems. When someones offers "to take care of you", first check your wallet.
vasilakisfil 6y ago
Interesting but I really don't envy working for a unicorn. Usually in such fast paced fast growing companies the most toxic environments tend to come up.
- nivenkos 6y ago
  I worked for one of the companies listed from the start of explosive growth from ~100 employees to 1000+. It was really fun. Some of the later PMs were toxic (I wouldn't say it's much better in large enterprises though), but it was great to focus on the engineering at the start and work closely with lots of different partners.
- natchy 6y ago
  dog-eat-dog is the natural state. Some people like it, other think it's toxic. I like to really explore innovative options so too fast of a pace can be annoying being at the bottom of the latter at a fast-paced company.
fhrow4484 6y ago
> To make the list, companies must hit the following criteria: headquartered in Europe; founded in 2000 or later; private Founded in 2000 or later seems odd definition for a "unicorn", the last one on the list, vente-privee was founded in 2001, that's 4 years before YouTube (2005), a year before LinkedIn (2002)... doesn't a unicorn loose its unicorn status after some point if not going public? Speaking of going public, not quite sure how up to date the list is, UiPath, which is about to go public, is headquartered in New York, USA, so does it still count as a Europe unicorn? :https://www.bloomberg.com/news/articles/2020-11-14/software-maker-uipath-is-said-to-pick-banks-for-2021-ipo https://www.bloomberg.com/news/articles/2020-11-14/software-...
- stu2b50 6y ago
  There's not really a universal definition of unicorn. At its origin and most basic it was just a private company over 1 billion in valuation. Since then, various sources have tried to amend it so that its "private startups" but there's not really a good definition of startup either.
slac 6y ago
No Truecaller? Very odd considering the amazingly high number of DAUs in India and the middle east. (they are based in Sweden)
oritsnile 6y ago
GitLab suprised me, always tough is was from the US.
- izolate 6y ago
  They initially competed on price and your first instinct wasn't to assume Dutch origin? Mine was.
- YorickPeterse 6y ago
  While the main HQ is in San Francisco today, it started out in The Netherlands. There's still a Dutch subsidiary and office, but it's mostly used to employ people.
dmitriid 6y ago
I've come to view these lists as bullshit. When you go through these lists (and especially lists of "unicorns" from the states) you see a few major trends. Many "unicorns" have several of these: - Price dumping and market grabbing through losses subsidised by infinite investor money - Price dumping and market grabbing by aggressively turning everything into gig economy (usually, losses subsidised by overworked underpaid couriers) - Financial market. No one has any savings to speak of, so managing credit is quite a lucrative business indeed. - Outright lies and vaporware: flying cars, innovative vehicles, fantastical medical devices etc. Once again, losses subsidised by infinite investor money And among this humongous pile of outright crap there are just a few companies that actually do something. And out of those may be one actual innovator.
M2Ys4U 6y ago
Genuine questions: Why do people care about unicorns so much? Why is having a bunch of $1bn+ companies necessarily a Good Thing? Is having lots of smaller companies seen as a Bad Thing?
- jfengel 6y ago
  Two things: 1. Unicorns are lottery tickets. People dream of being rich. 2. Unicorns represent Big Wins: an idea that was worth a huge sum of money. It makes the world a richer place, figuratively and literally. The person who had it (and more importantly, the people who run it) are Big Heroes. Companies like Facebook and Uber aren't just big companies. They change the world, making value from something that wasn't valuable before. That may be a Good Thing or a Bad Thing, but it's a Thing in a way that ten thousand smaller companies don't. As with celebrities, we probably talk about them disproportionately to the value -- in part because they give us something in common to talk about. But there's usually some kind of "there" there, as well.

Huh, looks more like London's Startup Unicorns on a first glance. Joke aside, can anyone explain to me why most startups there seem to be in the UK and so little in Germany or other countries? Genuinely curious, since the way I know my EU economics, is that Germany has a higher GDP than the UK.

IndrekR 6y ago
I can see in that list some that have HQ in London, but their origins and main teams are still in other countries. This is mostly due to investor's requirements to relocate.
emredjan 6y ago
I think it's related to risk-aversion of investors in EU. While spitting out millions of dollars anything with a slight chance of success is common in the US (and to some degree in UK apparently), EU investors are much more conservative in their spending, which affects the valuation of these companies.
nivenkos 6y ago
Other countries (e.g. Spain and Germany) have a lot more bureaucracy and fees around starting a company.
toyg 6y ago
Labour market and taxation are more flexible over here than on the continent. Also London was/is basically the financial capital of Europe, and the easiest destination for young talent for cultural reasons (it's easier for developers to learn English to a passable level than German, French, or less popular languages, when most of the ecosystem is built in and around English). This said, Berlin started later than London but, from what I hear, got much hotter in the last 5/10 years, so there might be some rebalancing in progress.
nottorp 6y ago
Here's a helper question: have you seen Bayer producing a Covid vaccine? Nope, they're happy producing aspirin. Less risk.
- raverbashing 6y ago
  Well, Bayer doesn't produce vaccines. But yes, there is risk avoidance in the German market (but the language barriers kinda make some startups look "invisible" outside of their non-English speaking countries)
- rsynnott 6y ago
  ... Of the major vaccines currently, Moderna was developed in the US, Pfizer/BioNTech in Germany (BioNTech, which developed it, is German), Oxford/AstraZeneca in the UK.
  - nottorp 6y ago
    BioNTech produced it but Pfizer financed it. And the Oxford one is in the UK where all the "unicorns" come from.
- brmgb 6y ago
  Merck is currently testing two vaccine candidates (Sanofi is too actually). They started development later and took more time but when all will be said and done, I fully expect them to have shipped more vaccines than Moderna and Pfizer: mRNA-based vaccines have never been produced at scale and the logistic involved seems rather complexe. Merck and Sanofi are developing vaccines based on existing vectors. They can reach true mass production as soon as they get approved. It's the same thing for Johnson and Johnson actually. AstraZeneca has what I would call a true headstart however.
geden 6y ago
Germans less interested in moving fast and breaking things than Brits in my experience. Especially outside of Berlin.

LittlePeter 6y ago

Counts by country: 54 United Kingdom 18 Germany 14 France 8 Netherlands 6 Switzerland 4 Sweden 4 Spain 2 Romania 2 Norway 2 Lithuania 2 Finland 2 Estonia 2 Cyprus 2 Belgium United Kingdom is definitely over-represented. Bad sampling by Sifted? Or is the climate in UK genuinely more favorable to start-ups?

varispeed 6y ago
UK had great laws geared towards mobile workforce and specialist contractors could claim business costs against their tax - this combined with little bureaucracy and use of de facto lingua franca was a recipe for success. From April next year this will end as government was looking for extra money and decided to adjust IR35 (a law that essentially says if you work as an employee you should be taxed as employee, but without having any employment rights), so that now the client has to determine whether contractor is a deemed employee or not. The problem is that the penalty for doing wrong determination only exist if you declare that someone is not a deemed employee, but investigating civil servant finds the opposite. That means risk averse companies change their contracts so that the contractor will always be deemed an employee to avoid getting fined (the fine plus all taxes that would have to be paid even if contractor already paid all the taxes). This still wouldn't be a problem if the rules about deemed employment were clear - but after so many years HMRC still keep losing cases where they get the determination wrong themselves. What this means for contractors? They essentially become employees without rights and the effective tax rate they will pay may be even around 54% plus they won't be able to deduct any business expenses (except what employee could have deducted - but that is essentially dead). Suddenly the market for IT specialists in the UK became unattractive and companies who are struggling to find people working for severe pay cut start to look overseas. edit: if you want more spice to this, then imagine that our Chancellor is married to woman that her and her father have substantial stake in Infosys.
- MrBuddyCasino 6y ago
  Same development as in Germany, its getting harder for freelancers. They say its for "protecting workers", but it really is about funding for social security systems. When someones offers "to take care of you", first check your wallet.

vasilakisfil 6y ago

Interesting but I really don't envy working for a unicorn. Usually in such fast paced fast growing companies the most toxic environments tend to come up.

nivenkos 6y ago
I worked for one of the companies listed from the start of explosive growth from ~100 employees to 1000+. It was really fun. Some of the later PMs were toxic (I wouldn't say it's much better in large enterprises though), but it was great to focus on the engineering at the start and work closely with lots of different partners.
natchy 6y ago
dog-eat-dog is the natural state. Some people like it, other think it's toxic. I like to really explore innovative options so too fast of a pace can be annoying being at the bottom of the latter at a fast-paced company.

fhrow4484 6y ago

> To make the list, companies must hit the following criteria: headquartered in Europe; founded in 2000 or later; private Founded in 2000 or later seems odd definition for a "unicorn", the last one on the list, vente-privee was founded in 2001, that's 4 years before YouTube (2005), a year before LinkedIn (2002)... doesn't a unicorn loose its unicorn status after some point if not going public? Speaking of going public, not quite sure how up to date the list is, UiPath, which is about to go public, is headquartered in New York, USA, so does it still count as a Europe unicorn? :https://www.bloomberg.com/news/articles/2020-11-14/software-maker-uipath-is-said-to-pick-banks-for-2021-ipo https://www.bloomberg.com/news/articles/2020-11-14/software-...

stu2b50 6y ago
There's not really a universal definition of unicorn. At its origin and most basic it was just a private company over 1 billion in valuation. Since then, various sources have tried to amend it so that its "private startups" but there's not really a good definition of startup either.

slac 6y ago

No Truecaller? Very odd considering the amazingly high number of DAUs in India and the middle east. (they are based in Sweden)

oritsnile 6y ago

GitLab suprised me, always tough is was from the US.

izolate 6y ago
They initially competed on price and your first instinct wasn't to assume Dutch origin? Mine was.
YorickPeterse 6y ago
While the main HQ is in San Francisco today, it started out in The Netherlands. There's still a Dutch subsidiary and office, but it's mostly used to employ people.

dmitriid 6y ago

I've come to view these lists as bullshit. When you go through these lists (and especially lists of "unicorns" from the states) you see a few major trends. Many "unicorns" have several of these: - Price dumping and market grabbing through losses subsidised by infinite investor money - Price dumping and market grabbing by aggressively turning everything into gig economy (usually, losses subsidised by overworked underpaid couriers) - Financial market. No one has any savings to speak of, so managing credit is quite a lucrative business indeed. - Outright lies and vaporware: flying cars, innovative vehicles, fantastical medical devices etc. Once again, losses subsidised by infinite investor money And among this humongous pile of outright crap there are just a few companies that actually do something. And out of those may be one actual innovator.

M2Ys4U 6y ago

Genuine questions: Why do people care about unicorns so much? Why is having a bunch of $1bn+ companies necessarily a Good Thing? Is having lots of smaller companies seen as a Bad Thing?

jfengel 6y ago
Two things: 1. Unicorns are lottery tickets. People dream of being rich. 2. Unicorns represent Big Wins: an idea that was worth a huge sum of money. It makes the world a richer place, figuratively and literally. The person who had it (and more importantly, the people who run it) are Big Heroes. Companies like Facebook and Uber aren't just big companies. They change the world, making value from something that wasn't valuable before. That may be a Good Thing or a Bad Thing, but it's a Thing in a way that ten thousand smaller companies don't. As with celebrities, we probably talk about them disproportionately to the value -- in part because they give us something in common to talk about. But there's usually some kind of "there" there, as well.