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The real fundamental issue is VCs, which as you pointed out, are far more adventurous in America.

cheptsov 2y ago
Unfortunately true, but one can also think that it’s a consequence and not the root cause. Why VC should invest if the environment isn’t supportive? A vicious circle :)
- kazen44 2y ago
  to give a different perspective, why are VC's somehow the cause of "tech industry"? this seems like a very US perspective on tech in general. Also, VC's in the US have another large advantage. Very, very cheap money because the status of the US dollar as a reserve currency compared to the euro and other currencies.
  - alephnerd 2y ago
    > why are VC's somehow the cause of "tech industry" Who else will give private capital for what is purely an idea? Not Banks giving a business loan - they will demand interest at the current interest rate. Not Private Equity - they only move private capital into public companies or late stage private companies Not Hedge Funds - they only deploy capital into public markets Not Growth Funds - they only deploy capital into late stage companies The only funds that will deploy private capital into early stage companies are Angel Investors and VC Funds. > this seems like a very US perspective on tech in general Israel, India, China, UK, Russia (pre-2022), Ukraine (pre-2022), and ASEAN all developed a VC scene similar to the American scene. Yet mainland West European investors are nowhere near as dynamic. If the Western European market was more dynamic, Spotify would not have moved to NYC, Ghodsi would have founded Databricks in Stockholm instead of San Francisco, and Datadog would have remained a purely French company instead of moving most of hiring from Product Leadership to HR to the US a decade ago. While you can mention ASML, the only reason ASML/Phillips even has EUV IP is because the US Government gave it to them instead of Canon or Nikon due to anti-trust reasons in the early 2000s and can very easily revoke IP access if prodded. > Very, very cheap money because the status of the US dollar as a reserve currency compared to the euro and other currencies Then why do high interest rate Israel, India, and China continue to have fairly robust VC scenes despite having high interest rates and currency controls and/or relatively illiquid currency markets? The reality is "cheap money" as in interest rates don't really matter for early stage funding. Indtutional investors always leave some money on the side for VC funding as a diversification tool. The difference is American, Israeli, Indian, Chinese, and ASEAN institutional investors will try to fund local VCs to build a local ecosystem, but Western European ones will just hand that money to an American, Israeli, Indian, or Chinese VC instead.
  - imtringued 2y ago
    The VCs ask you to relocate to the bay area if you want money. People go where the money is.
skywhopper 2y ago
On the contrary, I see the VC influence on American tech has been incredibly destructive. No one builds companies or products or services to last. Everyone is only in it for the quick buck. Basically every service provided by big tech has turned into a chase to cover it with ads and seek as much rent as possible while never actually improving anything. The state of software has gone downhill precipitously in the past decade and it’s only getting worse as VCs gain more and more control over the entire economy from housing to education to financial services to insurance.
- nrr 2y ago
  "... seek as much rent as possible ..." I think this is sorely understated in the context of understanding Europe's regulatory environment vis-à-vis American big tech companies or targeted advertising-supported (read: personal data mining) software startups. We need to remember that Europe is the continent that gave us extractive colonialism. A player always knows their own game.

Unfortunately true, but one can also think that it’s a consequence and not the root cause. Why VC should invest if the environment isn’t supportive? A vicious circle :)

kazen44 2y ago
to give a different perspective, why are VC's somehow the cause of "tech industry"? this seems like a very US perspective on tech in general. Also, VC's in the US have another large advantage. Very, very cheap money because the status of the US dollar as a reserve currency compared to the euro and other currencies.
- alephnerd 2y ago
  > why are VC's somehow the cause of "tech industry" Who else will give private capital for what is purely an idea? Not Banks giving a business loan - they will demand interest at the current interest rate. Not Private Equity - they only move private capital into public companies or late stage private companies Not Hedge Funds - they only deploy capital into public markets Not Growth Funds - they only deploy capital into late stage companies The only funds that will deploy private capital into early stage companies are Angel Investors and VC Funds. > this seems like a very US perspective on tech in general Israel, India, China, UK, Russia (pre-2022), Ukraine (pre-2022), and ASEAN all developed a VC scene similar to the American scene. Yet mainland West European investors are nowhere near as dynamic. If the Western European market was more dynamic, Spotify would not have moved to NYC, Ghodsi would have founded Databricks in Stockholm instead of San Francisco, and Datadog would have remained a purely French company instead of moving most of hiring from Product Leadership to HR to the US a decade ago. While you can mention ASML, the only reason ASML/Phillips even has EUV IP is because the US Government gave it to them instead of Canon or Nikon due to anti-trust reasons in the early 2000s and can very easily revoke IP access if prodded. > Very, very cheap money because the status of the US dollar as a reserve currency compared to the euro and other currencies Then why do high interest rate Israel, India, and China continue to have fairly robust VC scenes despite having high interest rates and currency controls and/or relatively illiquid currency markets? The reality is "cheap money" as in interest rates don't really matter for early stage funding. Indtutional investors always leave some money on the side for VC funding as a diversification tool. The difference is American, Israeli, Indian, Chinese, and ASEAN institutional investors will try to fund local VCs to build a local ecosystem, but Western European ones will just hand that money to an American, Israeli, Indian, or Chinese VC instead.
- imtringued 2y ago
  The VCs ask you to relocate to the bay area if you want money. People go where the money is.

skywhopper 2y ago

On the contrary, I see the VC influence on American tech has been incredibly destructive. No one builds companies or products or services to last. Everyone is only in it for the quick buck. Basically every service provided by big tech has turned into a chase to cover it with ads and seek as much rent as possible while never actually improving anything. The state of software has gone downhill precipitously in the past decade and it’s only getting worse as VCs gain more and more control over the entire economy from housing to education to financial services to insurance.

nrr 2y ago
"... seek as much rent as possible ..." I think this is sorely understated in the context of understanding Europe's regulatory environment vis-à-vis American big tech companies or targeted advertising-supported (read: personal data mining) software startups. We need to remember that Europe is the continent that gave us extractive colonialism. A player always knows their own game.