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Entirely fair question I think. I'd add that execution can easily be the difference. Notably french startups generally have poor execution. For example, the ent

Entirely fair question I think. I'd add that execution can easily be the difference. Notably french startups generally have poor execution. For example, the entrepreneur in France generally has to get loan on his own person, indebting himself, "to be sure he believes in his own idea".

traceroute66 5y ago
> indebting himself, "to be sure he believes in his own idea". Putting the French specific comment to one side because I don't have sufficient knowledge to comment, what I would say is that having "skin in the game" is no bad thing (it focuses your mind, and demonstrates your commitment to others). That's one of the problems with the US funding scene. On one side its great because people will throw obscene amounts of money at you if your marketing pitch sells well enough. One the other hand, it does lead to the situation where your commitment to the business only goes so far because you've basically always got someone else picking up the tab.
- mensetmanusman 5y ago
  On average it has worked spectacularly well though. Most founders aren’t taking a risk (they tend to come from wealthy families) they are executing a vision.
  - _tom_ 5y ago
    Depends on whether by “average” you mean “median” or “mean”! I’d bet the median return on startups is negative.
    - deepnotderp 5y ago
      The entire point of venture capital is to have 9 failures out of 10 and 1 that returns the entire fund
- tjs8rj 5y ago
  How frequently does this happen in reality? The reality is: startups are risky. Forcing the entrepreneur to take a bigger chunk of that risk than necessary leads to less innovation, playing it safe, and kills many businesses before they’ve left the ground. Would Airbnb exist? Would Coinbase exist? Would uber exist? Maybe, but probably not, because the founders here weren’t rich enough to absorb the costs given the odds. In theory, having that much skin in the game sounds like a pro with small cons. The reality is that is kills innovation, leaves the few brave enough who fail indebted and hampered for years, and makes the successful a fraction of the scale (and disproportionately founded by those already rich).
  - GDC7 5y ago
    Companies providing those services would exist anyways. The profile of the person founding them would be different. You'd have istrionic risk takers, borderline gamblers carrying the company for the first say 5 years, then they'd be bought out and a more stable person would be brought in. The VC model enables the economy at large to artificially skip the first step. It's artificial because Silicon Valley companies which basically start from zero and arrive in the S&P500 in 20 years or less, they have very low turnover in managment and executives. It's like a Vietcong learning how to fly an F-35.
- deepnotderp 5y ago
  If only we could compare the success levels of the two funding scenes...
  - traceroute66 5y ago
    > If only we could compare the success levels of the two funding scenes... As long as the US side doesn't seek to brush over the failures by attempting to focus people's attention on the successes. And also as long as we have a fair definition of "success" .... an exit strategy that comprises being able to hype up a blatantly overvalued IPO is not "success", for example. Let's face it there have been some quite spectacular failures in the US in recent years. As well as many more less spectacular that have burnt through millions of dollars in cash before calling it quits. All that glitters is not gold. The US has a mentality of "throwing more money at the problem", but that does leave you in an environment where larger and larger burn rates become acceptable.
    - deepnotderp 5y ago
      The entire point of VC is a high failure rate and lots of failures with a few breakaway successes.
atlasunshrugged 5y ago
I'm not french but spent a fair amount of time in the EU tech ecosystem and I think that "Notably french startups generally have poor execution." is a super general statement that isn't fair to apply. I mean Bernard Arnault, one of the wealthiest people in the world, built LVMH and the government has been working hard via the la french tech initiative and Station F to make the startup ecosystem much more friendly.
- EmilyHATFIELD 5y ago
  I think you're thinking about Xavier Niel, which created Free, Station F and 42
- c_o_n_v_e_x 5y ago
  I worked for a French founder for a few years and was quite involved with a lot of French people and companies (Thales, Veolia, Engie... to name a few) in tech. I'll reserve my comments about my own personal experience but I think the characterization of poor execution is a bit sweeping. Where I think the French and American start up communities differ is that failure is not generally accepted in France, whereas in the US it's acknowledged and somewhat accepted to have a few "duds" on the resume.
_tom_ 5y ago
The loan approach misses the fact the the entrepreneur is going to spend several years of his life on the project. Nobody starts a company they don’t believe in. The cost is too high, even without the loans.

traceroute66 5y ago

> indebting himself, "to be sure he believes in his own idea". Putting the French specific comment to one side because I don't have sufficient knowledge to comment, what I would say is that having "skin in the game" is no bad thing (it focuses your mind, and demonstrates your commitment to others). That's one of the problems with the US funding scene. On one side its great because people will throw obscene amounts of money at you if your marketing pitch sells well enough. One the other hand, it does lead to the situation where your commitment to the business only goes so far because you've basically always got someone else picking up the tab.

mensetmanusman 5y ago
On average it has worked spectacularly well though. Most founders aren’t taking a risk (they tend to come from wealthy families) they are executing a vision.
- _tom_ 5y ago
  Depends on whether by “average” you mean “median” or “mean”! I’d bet the median return on startups is negative.
  - deepnotderp 5y ago
    The entire point of venture capital is to have 9 failures out of 10 and 1 that returns the entire fund
tjs8rj 5y ago
How frequently does this happen in reality? The reality is: startups are risky. Forcing the entrepreneur to take a bigger chunk of that risk than necessary leads to less innovation, playing it safe, and kills many businesses before they’ve left the ground. Would Airbnb exist? Would Coinbase exist? Would uber exist? Maybe, but probably not, because the founders here weren’t rich enough to absorb the costs given the odds. In theory, having that much skin in the game sounds like a pro with small cons. The reality is that is kills innovation, leaves the few brave enough who fail indebted and hampered for years, and makes the successful a fraction of the scale (and disproportionately founded by those already rich).
- GDC7 5y ago
  Companies providing those services would exist anyways. The profile of the person founding them would be different. You'd have istrionic risk takers, borderline gamblers carrying the company for the first say 5 years, then they'd be bought out and a more stable person would be brought in. The VC model enables the economy at large to artificially skip the first step. It's artificial because Silicon Valley companies which basically start from zero and arrive in the S&P500 in 20 years or less, they have very low turnover in managment and executives. It's like a Vietcong learning how to fly an F-35.
deepnotderp 5y ago
If only we could compare the success levels of the two funding scenes...
- traceroute66 5y ago
  > If only we could compare the success levels of the two funding scenes... As long as the US side doesn't seek to brush over the failures by attempting to focus people's attention on the successes. And also as long as we have a fair definition of "success" .... an exit strategy that comprises being able to hype up a blatantly overvalued IPO is not "success", for example. Let's face it there have been some quite spectacular failures in the US in recent years. As well as many more less spectacular that have burnt through millions of dollars in cash before calling it quits. All that glitters is not gold. The US has a mentality of "throwing more money at the problem", but that does leave you in an environment where larger and larger burn rates become acceptable.
  - deepnotderp 5y ago
    The entire point of VC is a high failure rate and lots of failures with a few breakaway successes.

atlasunshrugged 5y ago

I'm not french but spent a fair amount of time in the EU tech ecosystem and I think that "Notably french startups generally have poor execution." is a super general statement that isn't fair to apply. I mean Bernard Arnault, one of the wealthiest people in the world, built LVMH and the government has been working hard via the la french tech initiative and Station F to make the startup ecosystem much more friendly.

EmilyHATFIELD 5y ago
I think you're thinking about Xavier Niel, which created Free, Station F and 42
c_o_n_v_e_x 5y ago
I worked for a French founder for a few years and was quite involved with a lot of French people and companies (Thales, Veolia, Engie... to name a few) in tech. I'll reserve my comments about my own personal experience but I think the characterization of poor execution is a bit sweeping. Where I think the French and American start up communities differ is that failure is not generally accepted in France, whereas in the US it's acknowledged and somewhat accepted to have a few "duds" on the resume.

_tom_ 5y ago

The loan approach misses the fact the the entrepreneur is going to spend several years of his life on the project. Nobody starts a company they don’t believe in. The cost is too high, even without the loans.