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Comment by tschellenbach | Hacker News Reader

I'm from Europe, living in the US, and it always frustrated me that startups are able to do so well in the US and China, yet find very little momentum in the EU. It's crazy, there is plenty of local talent in Europe's tech hubs.

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Let me give you a real world data point.

I'm in the UK. With a bootstrapped startup. I get no problems contacting US companies. Each upper level manager, VP or even CEO that I contact are all excited about the project. Have no issues getting a service provider onboard.

Juxtapose this with a UK or EU company, where lets face it. There's no bootstrap startup culture at all.

Anyway, here's my anecdotes:-

- If I contact the sales or info mailbox on the website. I don't get a response. Even after 2 or 3 more follow ups.

- If I contact the sales team by phone, no one is ever available. They are permanently busy.

- If I do manage to get in contact with someone, they tell me to send information over and they don't call back.

- If I do manage to get a VP/Director email address. I send out the initial email and then I hear silence back. Follow on emails just get ignored.

The US and UK/Europe mentality are completely different. In the US you can start in your basement, garage or even on the streets and fight your way to a unicorn. There is infrastructure available to make a success and everyone has a vested interest in that.

In the UK/Europe it seems, the general feeling that I get. Is that unless you have sold a major stake to a VC/Accelerator, there's no way you'll succeed!

Also everyone wants a slice of your company for free because in all honesty, they are a bunch of freeloaders. I've had 5 instances already of companies telling me they can partner with me for 5-10% of equity. I just ignore them.

Hiring might not be as big a fear, compared to firing in Europe. A startup cannot quickly cut a bad fit there.

Mostly I see that as a feature not a bug. If you can't trust management for hiring why trust them for firing. You got like a couple of months "test period" that can end every month anyway.

Why do you think it is like that? Access to risk capital? Lack of IPOs?

Fragmented European market; the culture and language differences.

Bingo. You can launch a startup in the "United States" or "in China" in day one. You can't really launch a startup in "Europe" from day one, unless you only offer an online service and only to the English speakers (a tiny single-digit percentage, on average) of those countries.

Beyond the language barrier, does the regulatory burden of complying with all applicable EU and individual state rules factor in at all?

it depends on your market you are trying to enter.

Let's not forget that harmonizing these rules is one of the major points of the EU in the first place.

I don’t but that argument. In math you’d say that this is an “continuous function”, wouldn’t you? Where is the break-off point? Germany for example has 80 mio people, Japan has 120 mio or so. You’d expect the same level of activity scaled by population size. Am I wrong?

EDIT: Another example countering your point is Sweden/Stockholm. Tiny population, high number of startups and unicorns.

That really heavily depends on the market in question. They're all so different in terms of culture, regulation, politics, market structures, productivity, output, wealth, etc.

Jordan for example has the same population size as Sweden, that's about where the similarities end.

Sweden, along with Canada and Australia, are just about ideal micro US versions in technology, in terms of potential to pull off your scaling of activity. Good market economies, relatively robust technology societies and technology economies, high GDP per capita and incomes, plenty of wealth and capital to invest, stable open societies with respect for human rights, english language use giving them global benefits (Sweden having one of the world's highest english language adoption rates, outside of primarily english speaking countries), and so on.

Japan has far less spending power per capita - disposable income - than the US, and their economic output per capita is similarly far lower. Their cost of living is not far lower to offset. US GDP per capita will be around $63,000 for 2018. Japan is down around $38,000 to $40,000. Culturally Japan has historically not been friendly to risk taking, entrepreneurial activity. That has shifted some over the last 10-15 years, but not immensely (it's starting from an extreme where a long corporate career was the only acceptable path). There's a considerable difference between Sweden and Japan on that conservativism. Japan also is very different at a macro level, they put themselves into a particularly bad 20+ year debt trap that has robbed their economy of the surplus capital it needs to invest into expansion and innovation.

Germany is doing OK, in regards to technology and tech start-ups. They've lagged a bit in the transition from old industrial to new technology [1][2], it appears to be a cultural problem that is acting as friction. Culturally they're not nearly as dynamic on entrepreneurism as Sweden has become. Perhaps it's just easier to change directions at the scale of Sweden than Germany, with all the entrenched institutions and large conglomerates that Germany has.

[1] https://www.bloomberg.com/news/articles/2018-06-12/germany-n...

[2] https://www.bloomberg.com/news/features/2018-08-16/inside-eu...

Ok, so you’re saying it’s not size (as single root cause)

That's a lazy excuse, IMHO.

To me the key is to embrace new ideas, think big and have the drive to deliver.

An example: Deliveroo is doing extremely well in many markets around the world but is a British company. Interestingly the founder is... American of Chinese origin.

I had a classmate from France in my class at a US college. He opinion was that in American you can think big and fail and no one looks down at you for it. Not the same in the EU.

Same with becoming wildly successful. In America those people are looked up to as role models. In many parts of the EU, being the "tall poppy" is a bad thing.

Investors tend to be very rational here, they won't throw money and any stupid shit. At least that's what I've seen :) Of course, if you do that, you will find unpolished gems from time to time.

https://www.weforum.org/agenda/2017/11/europe-venture-capita...

Size of the market, US and China have #1 and #2 economies. Start-ups in India seem to have similar problem as Europe, given multi-lingual nature of mass market.

> Size of the market, US and China have #1 and #2 economies. Start-ups in India seem to have similar problem as Europe, given multi-lingual nature of mass market.

I've never done internationalization, but I'm surprised language could be such a barrier. Couldn't you just hire a team of translators on a contract basis?

Maybe theres's some market for internationalization-as-a-service.

Doubtful. It's less about verbatim translation of text from one language to another, and more about changing your product's design + data architecture to accomodate the possibility of more than one language. It's a lot of overhead. You now need to answer questions like: "Do I need to add a dropdown to select languages? How would I store the different texts for each language for different parts of my product? How would I have to change the visual design of my product now that I have to account for translations in other languages being wider / narrower than my core language? What about right-to-left languages?"

It's not only language, it is also a huge cultural differences. Swedes have as much in common with the Portugese as Americans with Columbians - really not much. Also very different legislations, banking systems, difficult tax handlings and so on. How do you even handle support for 23 different languages as a startup? Do sales and marketing in 23 languages?

all of the EU has had the similiar banking system[1] for ages now. Tax handling can be an issue, but i won't see how this is different between the different taxes between US states.

Also, culture and language are major barriers in the european market, legislation less so (especially if you ship physical products).

1: https://ec.europa.eu/info/business-economy-euro/banking-and-...

Merely translating the interface is not the main problem IMO. Word of mouth, TV, newspaper, youtube channels and other "influencers"... Everything more or less stops at the border. There are also significant cultural differences that might make it difficult to make your product appealing to the whole market.

In the US if you get the hype going about your startup, get mentioned by a few high-profile newspapers, news programs and Instagram celebs you can ramp up pretty quickly. In Europe your brand can be mainstream enough that it becomes a common name in Italy while at the same time nobody ever heard of you in Germany.

Ever heard of Skyblog? I remember that in the early 2000's it was basically French Myspace. It was spawned by a French radio but became super popular on its own, all the French teens back then had a "Skyblog" (and an MSN messenger account). How many non-francophone Europeans have heard of a Skyblog? Not many I'd wager. Actually I doubt that even today's French teenagers know what a Skyblog is, they're using Instagram and whatever else while Skyblog is joining the Minitel as a footnote in the history of the French internet.

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