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Y Combinator’s European founder intake continues to grow
- wesleyverhoeve 5y agoWondering which EU countries will take the lead here.
- forgingahead 5y agoIt's definitely good to see a strong increase in entrepreneurship in Europe, though I do wonder whether the Y Combinator program can keep up its quality and value-add as they themselves scale up. It's one thing to have weekly sessions with experienced leaders like PG and others, and a small enough cohort whereby you can swap stories and learn as you progress through the program. On an industrial scale though, you lose a lot of that intimacy and you have to default to cookie-cutter approaches. Learning via mentors originally, vs. learning in the classroom currently. I know many founders use Y Combinator as a badge of merit to increase their chances of follow-on funding, but there is an interesting question of how much value-add it now adds to the original type of startup team (young, scrappy, more inexperience than product-market-fit and customers).
- ThePhysicist 5y agoThe weekly video sessions that StartupSchool offers are great. I participated in them during the first batch when they were led by YC alumns (I think now they're just self-organized), they basically just consist of people taking turns telling the group what they did last week and what they plan to do this week. In retrospect it was really great thing and helped me enormously to focus and make progress. Especially as a solo founder it's hard to keep focused as there's no one to "yell" at you if you're getting distracted, so having a group of peers that are in the same situation and that provide a bit of social pressure and encouragement was really great. Also, people would sometimes share stuff they struggle with, which also helped a lot to put things in perspective as startup life can get pretty grim, so it helps to laugh about failures with other people. Really sad they
- ant6n 5y agoI think something guy cut off. Aren't all these videos available online still as part of the startup school material?
- ThePhysicist 5y agoAh my mistake, I originally though they discontinued these but actually they still exist, albeit without being led by YC alumns (I think).
- antupis 5y agoThis is basically failure in European startup ecosystem that companies needs to go SF, but good for Y Combinator and SF that they can attract best talent.
- lrem 5y agoIt's not "European startup ecosystem", it's basically "European societies". Imagine how well would SV work if being involved in a bankrupt company (co-founder, major investor, C-suite) made banks refuse to talk to you again for 10-20 years. I believe that was the case in France. You wouldn't even be able to open a checking account, never mention any credit again.
- qwerty456127 5y agoAFAIK banks are legally required to open checking accounts on demand of any resident in Germany, no matter their background. But I am not sure, just a rumor.
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- gyulai 5y agoNot just a rumor. If you speak the right incantations at the counter, invoking the relevant legal reference, a bank in Germay will be obliged to give you a "basic bank account" with no credit facilities of any kind. There's also nothing stopping them from making that bank account the least attractive bank account you've ever heard of by charging insanely high fees and prohibiting you from using the regular ATM network, restricting you to just a few machines in a restricted geographical area.
- qwerty456127 5y ago> If you speak the right incantations at the counter, invoking the relevant legal reference What are these? > There's also nothing stopping them from making that bank account the least attractive bank account you've ever heard of Why would they want to? What do they actually risk? > restricting you to just a few machines in a restricted geographical area. Officially area-specific or just through the specific kind of machines accepting specific kind of cards being absent outside of it? I've heard of the unreasonably complicated system of types of cards in Germany: normal debit, "electronic cash" etc.
- qwerty456127 5y agoDo they mostly move to the United States then?
- oblio 5y agoI wouldn't be surprised. Daniel Dines started UiPath in Romania but for it to become truly global, he had to move to NY and even incorporate the company there.
- qwerty456127 5y agoI don't want to insult Romania (and I actually am looking forward to an opportunity to visit it, there apparently are many spectacular places, nice people and delicious cuisine), but AFAIK it's rather far from the best places in the EU from the economic/social points of view, no surprise many people prefer to emigrate on a good opportunity. I would be more curious if founders still move to the US from Spain, Germany, Switzerland, Netherlands, Ireland etc.
- oblio 5y agoUIPath has a huge development office in Bucharest, most of the company is there. Don't kid yourself, he went to NY for the money :-))
- awelkie 5y agoThey at least need to incorporate in the US, Canada, Singapore, or the Cayman Islands. https://www.ycombinator.com/faq#q25 https://www.ycombinator.com/faq#q25
- Cthulhu_ 5y agoIf they want to do business in the US, they often do; the US market is very protective and isolationist like that, for some reason. An EU company doing business with an US based company is a lot easier.
- pjc50 5y agoPayflow: https://www.payflow.es/ https://www.payflow.es/ (surprisingly, no english version) This is a fantastic innovation if it takes off and if the charges aren't prohibitive; it has the potential to obliterate predatory payday lending. In a world of free instant automatic electronic payments, there's no good reason to delay salary payments until the end of the month.
- thaumasiotes 5y ago> it has the potential to obliterate predatory payday lending Say you earn about $200 over expenses in a given month. Your car suffers a problem that requires $1000 to repair. This is 5 months of income, but you probably want to repair the car at the beginning of the 5 month period rather than the end. How much of a difference will it make if your paycheck arrives daily rather than semimonthly?
- pjc50 5y agoPayday lending is usually considered to be for amounts that are less than one month's income.
- thaumasiotes 5y agoAnd? Your monthly income is $200 over expenses.
- Grustaf 5y agoThe point is that it's for people that are living hand to mouth. They're not saving a cent, living constantly on the brink. For them it makes a huge difference to get paid a few days earlier. But this is also why even free payday loans seem to me like a very bad long term idea - if you are living that close to the edge, how will you ever be able to get out of debt?
- Semaphor 5y agoI don’t quite understand the benefit. Surely, if you have to take loans to get over the month, this won’t change anything as your overall income is still the same. I guess for unexpected expenses, you can bridge the gap one-time by borrowing from future-you. What am I missing?
- jamil7 5y agoI always wanted something like https://www.carbonfact.co/ https://www.carbonfact.co/ - hope it takes off and they expand the list of products.
- martindaniel4 5y agoThank you jamil7 <3
- bttrfl 5y agoI'm rooting for something like this too. As for the carbonfact and their focus on promoting eco brands, I'd like them to present an alternative metric if/when possible. Measuring each individual product is complicated and doesn't have to reflect brand's entire emission output. If a company is 10% manufacturing and 90% marketing then the methodology used by carbonfact will be underreporting the emissions. Some brands (inc. Nike) are already disclosing their total emission. Others might be forced to do so in a near future by regulators. Would it be possible to have a metric calculated simply as 'total emissions / units sold'?
- logronoide 5y agoI think it’s a sign of the times: the pandemic, the “everything is remote”… and of course the weak European ecosystem compared to the Americans’. Really happy for all the European founders that made it.
- ionwake 5y agoAs a solo european with a secret startup Ive been working on for a couple of years ( Im semi retired young ) where should I apply for an assessment for possible seed? Is enrolling onto ycombinator still the best way?
- mathverse 5y agoThe term "european" is meaningless.It's all just bunch of countries working under some framework. As a european there's no shared success if one european company succeeds.And because of that there's no synergic effects that would help "european" companies to grow and improve.
- Cthulhu_ 5y agoThere is some though; there are little to no restrictions for one country to use a service in another european country, or traveling to visit it. No currency conversion needed either.
- dukeyukey 5y agoUnless you live outside the EU, like in the UK, Norway, or Switzerland. Or in a non-Euro country, like Sweden or Poland.
- biztos 5y ago> or traveling to visit it Except during Covid, which might last forever. > No currency conversion needed either Except when you need to transact literally anything outside of the SEPA system, and then you have conversations and bank fees and very little control over either.
- solarkraft 5y agoThat’s pretty cool. It’s also a testament to the lack of capital for new stuff in the EU, which is sad, but at least something is being done about it, and if it has to be foreign investment. Thanks, guys.
- gyulai 5y agoI'm wondering if this actually implies that Y-Combinator is willing to touch even with a 10-foot-pole companies incorporated in jurisdictions where company law works very differently from the U.S. For example in Germany & Austria, if a startup is organized as a GmbH ("Gesellschaft mit beschränkter Haftung"), regulations around transfer of shares and minority shareholder protections are a lot heavier than for U.S. corporations and AG ("Aktiengesellschaft") with freely-transferable shares come with a high regulatory burden in all kinds of areas. My working hypothesis until obtaining information to the contrary is that the answer is "no", and that "European" in the article basically just means "London".
- dagw 5y agoYou can be from anywhere but your company has to be incorporated in United States, Canada, Singapore or the Cayman Islands. If you already have a GmbH and want to join YC you have to incorporate a parent company in one of those jurisdictions and make your existing company a subsidiary of that new parent company. YC will then invest and take a stake in the parent company rather than your 'real' company https://www.ycombinator.com/faq/ https://www.ycombinator.com/faq/
- ToJans 5y agoIn my experience (Belgian guy that dabbled a bit with EU VCs for my SaaS) Europe is very risk-adverse, and you either have to give up ridiculous amounts of equity for a little amount (i.e. 50k€ for a 25% to +50% stake) when not established yet, or have a recurring revenue of at least 50k€/month to get reasonable propositions. Also, European culture is slightly different: most people consider a startup failure as something bad that you drag along for the rest of your career. I've talked to some European VCs, and while they have big ambitions and are starting to gain momentum, it might take a while before the shift in the European mentality happens, and we end up with a thriving ecosystem. Some hubs (Switzerland and Berlin for example) seem to be doing quite good. I also assume a big difference with the US is the fragmented market: different languages, cultural differences, legislative constraints, market demands, ... For example, in my experience high touch B2B sales are highly impacted by the language gap, in fact some countries (France, Spain, Italy, ...) are notoriously against working with people who don't speak their mother tongue. (On the bright side most of us Belgians do speak at least 3 languages, so it is still somewhat doable.) As an alternative to VCs in Europe, you could look at some of the national and European subsidized tracks, although they tend to be mostly coupled to the trend-of-the-decade (sustainability is hot right now), and also require quite some effort to enter with no guarantees of success. (Disclaimer: it's on my to-do list, so no real experience with this.) I would presume the combination of all of these factors results in people looking on other continents for better opportunities. (I personally think Africa might offer huge opportunities in the coming decades, but that's for another time.)
- stevoski 5y ago> “European culture is slightly different: most people consider a startup failure as something bad that you drag along for the rest of your career.” I hear this over and over, but in my 20 years of living in Europe, I haven’t found this to be the case. Perhaps it is only in some European countries or cultures?
- agd 5y agoCertainly not the case in the UK from my experience.
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- dgellow 5y agoIMHO the main issue in Europe is the lack of a common market. So many different languages, cultures, and local regulations creates A LOT of fragmentation. If you’re in the US or China you have access to a massive pool of potential customers as soon as you release your product. In Europe that’s not the case, all your branding, marketing, or other content will have to be adapted to a specific language or culture. So instead of the EU dream of a EU market you have to take in account lot of small markets with their own specificities.
- streamofdigits 5y agoThere are cultural and political barriers that segment the European landscape like cracks in dry desert soil. From miserly jealousy to parochialism, to excessive (and in parts corrupt) bureaucracy, to very preliminary economic / financial / legal integration, to (justified) lack of trust between European states and long-held rivalries, its all here in abundance. Maybe YC can see past all that malaise into a brighter European future where startups scale and change the world :-) ... or maybe its just funny money that is being spend on a deep out of the money option.
- _qsgk 5y agoI am an American founder that accidentally built a company in Europe. I hired my first person there, and through the path of least resistance, most of our 45 person team is based in Europe. I believe I am playing 'business' on easy mode compared to European founders. As an American founder it's pretty easy for my US company to pay my European team as contractors. European founders have to comply with European employment law. In the country a lot of my team resides, here are the rules: 1. ~50% tax on W2 employees (we pay none) 2. Ability to take 1 year of maternity leave, available on day 1 of joining a company. Up to 2 years if there are complications. 3. 32 days of PTO standard for entry level roles Here were my rules as an American founder / company hiring in Europe: 1. No employment tax because everyone is hired as a contractor 2. Today we have a 2 month paid policy after 2 years in our org. We're hoping to improve this as our company becomes more financially secure, but the liability at this stage of our organization is significant. 3. We offer 38 days of PTO today, but for the first year we didn't have an official PTO policy. Building a startup in Europe as a European founder is very, very hard due to the above compliance requirements.
- sschueller 5y agoHow about you build a actual sustainable business that doesn't take part of its profits out of cheating its "employees". If you can't pay your employees you do not have a sustainable business model in the country you operate.
- ToJans 5y agoWhile this is somewhat true, most of the European founders I know work around this by hiring freelance senior contractors and employing heavily subsidized juniors.
- ggrrhh_ta 5y agoWhich European country are you referring to?
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- dancemethis 5y agoNope, will never understand how this Y Combinator thing is more than HN. Nor how it's even remotely interesting.
- tlogan 5y agoI will list some problems / challenges Europe has: - different languages: even with simple SaaS you might need to do a demo. - different cultures: marketing in Spain is different than in Germany, different in Poland, etc. so market is very fragmented. Even Germany is much more diverse than people think (the joke is: Balkan starts just north of Munich) - much more complex laws - recruitment is harder: candidates are much more conservative. - cultural similarities: entrepreneurs are considered as a failure It is just harder. Not impossible but harder.
- gautamdivgi 5y agoIsrael does extremely well with startups and exits notwithstanding cultural differences (e.g. weekends are not the same with the rest of the western world). What are the big differences between what Europe does vs. what Israel does? Risk-aversion may be one aspect but I doubt its the only one. There are probably a whole lot of factors.