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They want to create competing to US cloud companies in Europe. If I understand the business strategy as presented they initially will target companies that can'

They want to create competing to US cloud companies in Europe. If I understand the business strategy as presented they initially will target companies that can't use US cloud for legal reasons, so US clouds can't even compete (so the competition while they get off the ground is small scale cloud providers in Europe), which will then give them a base from which to fight the big clouds for clients. Quick googling says that AWS, Azure and GCP have 69% of the European cloud market. I wonder how big Europe is for their overall profits, and if this could potentially be a big problem for then in the future.

scroot 3y ago
The market share of these services in the EU might end up being affected by the passage of the Digital Services Act and its sister bill the Digital Markets Act
nikanj 3y ago
EU is pouring huge amounts of money into development grants, because they want to decrease their dependency on the global markets. Expect GAaaS startups (grant applications as a service) to pop up left and right, offering extremely slick pitch decks, founders in well-fitting suits and ridiculous pie-in-the-sky business ideas. It’s some version of ”build it and they will come”. Granting millions in free money to anyone who promises to create an EU alternative to AWS / Intel / Facebook gets you a lot of said promises.
- belval 3y ago
  > Over the next two years, it plans to raise €3bn — that averages out as €125m a month for everyone keeping score at home The EU pledged €2bn so it's mostly government funding. Imagine burning €125m in public money every month.
  - foolswisdom 3y ago
    The 2bn from the EU is not earmarked for Evroc, I understood that it was a general allocation (though perhaps they expect to get a lot of it).
  - arlort 3y ago
    The EC wants to invest 2b€ in the sector in general, not in the company specifically
- Aeolun 3y ago
  It was never entirely clear to me how I actually get this money except by making friends and rubbing backs with the people in Brussels. It certainly doesn’t seem to be based on likelyhood of success.
  - nikanj 3y ago
    Seems like you already answered yourself. Crony capitalism and nepotism are the traditional EU way of doing business. That’s why our companies tend to lose on the global market, when faced with a level playing field and real competition
    - ChuckNorris89 3y ago
      Pretty much yes, that's why all EU funded tech projects are half-assed. As soon as the EU public money dries up, all investors pull out as well because they know nothing they do is meant to be competitive on the free market, they're just there to suck on the teat of easy EU money and take off when it's dry. The sad part is, without EU money, nothing in tech would happen in the EU. We have no VC investors willing to put their money in something as risky as tech when they can put their money in much safer places with surer returns like real estate which sacred in the EU compared to let's say the US. The EU start-up I was working for was looking for VC investors and we found some German guy who was like "yeah I can invest 100k in your company" at which point our boss was like "bruh, that will barely cover scientist, dev wages and infra for 3-5 months". Then came and American guy with an initial investment of 2 million. Nuff said.
      - nprateem 3y ago
        How would an investor pull out prior to an exit? Since they can't why would they invest in something they don't expect to be competitive. How could they suck on the EU teat? This makes no sense. As you point out, the real issue appears to be a lack of VC risk appetite for investing in early-stage startups in the EU vs the US.
        ChuckNorris89 3y ago
carlosjobim 3y ago
It should be embarrassing for Europeans that the only way they can compete with Americans in IT is by literally banning US products. I don't think that will work out very well for them in the long run. Europe is otherwise usually a fierce competitor in high tech, but when it comes to IT it seems they didn't really got going strong. Just out of sheer patriotism, European companies could snatch back a lot of customers from their foreign competitors by just offering an equal or slightly worse product.
- Aeolun 3y ago
  The big problem is IT in Europe just doesn’t pay very well. It beats a blue collar job, but anyone truly good has the option to emigrate for 2-3x more money.
  - tiluha 3y ago
    Moving away from your established life, friends, family to a country where you will (at least initially) be foreign, where the lifestyle is different are burdens that should not be underestimated. I'm sure everybody in the EU would like US level salaries, but most wouldn't move for the money alone
    - ddorian43 3y ago
      America is the ~only country where you may truly be "local" in the eye of the locals. In all other countries you'll always be a foreigner (your kids will be local though).
      - ChuckNorris89 3y ago
        UK as well, it's very welcoming to foreign workers compared to most of continental Europe where even if you learn the language you're still a a foreigner with glass ceilings.
  - zekrioca 3y ago
    And 10x for healthcare elsewhere.

scroot 3y ago

The market share of these services in the EU might end up being affected by the passage of the Digital Services Act and its sister bill the Digital Markets Act

nikanj 3y ago

EU is pouring huge amounts of money into development grants, because they want to decrease their dependency on the global markets. Expect GAaaS startups (grant applications as a service) to pop up left and right, offering extremely slick pitch decks, founders in well-fitting suits and ridiculous pie-in-the-sky business ideas. It’s some version of ”build it and they will come”. Granting millions in free money to anyone who promises to create an EU alternative to AWS / Intel / Facebook gets you a lot of said promises.

belval 3y ago
> Over the next two years, it plans to raise €3bn — that averages out as €125m a month for everyone keeping score at home The EU pledged €2bn so it's mostly government funding. Imagine burning €125m in public money every month.
- foolswisdom 3y ago
  The 2bn from the EU is not earmarked for Evroc, I understood that it was a general allocation (though perhaps they expect to get a lot of it).
- arlort 3y ago
  The EC wants to invest 2b€ in the sector in general, not in the company specifically
Aeolun 3y ago
It was never entirely clear to me how I actually get this money except by making friends and rubbing backs with the people in Brussels. It certainly doesn’t seem to be based on likelyhood of success.
- nikanj 3y ago
  Seems like you already answered yourself. Crony capitalism and nepotism are the traditional EU way of doing business. That’s why our companies tend to lose on the global market, when faced with a level playing field and real competition
  - ChuckNorris89 3y ago
    Pretty much yes, that's why all EU funded tech projects are half-assed. As soon as the EU public money dries up, all investors pull out as well because they know nothing they do is meant to be competitive on the free market, they're just there to suck on the teat of easy EU money and take off when it's dry. The sad part is, without EU money, nothing in tech would happen in the EU. We have no VC investors willing to put their money in something as risky as tech when they can put their money in much safer places with surer returns like real estate which sacred in the EU compared to let's say the US. The EU start-up I was working for was looking for VC investors and we found some German guy who was like "yeah I can invest 100k in your company" at which point our boss was like "bruh, that will barely cover scientist, dev wages and infra for 3-5 months". Then came and American guy with an initial investment of 2 million. Nuff said.
    - nprateem 3y ago
      How would an investor pull out prior to an exit? Since they can't why would they invest in something they don't expect to be competitive. How could they suck on the EU teat? This makes no sense. As you point out, the real issue appears to be a lack of VC risk appetite for investing in early-stage startups in the EU vs the US.
      - ChuckNorris89 3y ago

carlosjobim 3y ago

It should be embarrassing for Europeans that the only way they can compete with Americans in IT is by literally banning US products. I don't think that will work out very well for them in the long run. Europe is otherwise usually a fierce competitor in high tech, but when it comes to IT it seems they didn't really got going strong. Just out of sheer patriotism, European companies could snatch back a lot of customers from their foreign competitors by just offering an equal or slightly worse product.

Aeolun 3y ago
The big problem is IT in Europe just doesn’t pay very well. It beats a blue collar job, but anyone truly good has the option to emigrate for 2-3x more money.
- tiluha 3y ago
  Moving away from your established life, friends, family to a country where you will (at least initially) be foreign, where the lifestyle is different are burdens that should not be underestimated. I'm sure everybody in the EU would like US level salaries, but most wouldn't move for the money alone
  - ddorian43 3y ago
    America is the ~only country where you may truly be "local" in the eye of the locals. In all other countries you'll always be a foreigner (your kids will be local though).
    - ChuckNorris89 3y ago
      UK as well, it's very welcoming to foreign workers compared to most of continental Europe where even if you learn the language you're still a a foreigner with glass ceilings.
- zekrioca 3y ago
  And 10x for healthcare elsewhere.