Fair point. With that said, both are expensive for lean startups without outside investment. Many Dutch startups always look at the Dutch market first, before they fan out to a few European countries and only then do they look at Europe. And if that all succeed, only then do they dare to look at the US and perhaps the world.

Case in point: takeaway.com

Single market really makes this much less work than you’d expect.

It isn't that cheap if you have to consider different branding and marketing campaigns when you want to expand to neighbor regions. The cost of covering the EU market can increase really fast.

Edit: it's also an ongoing cost, so the earliest you start to support additional locales the more expensive your general product development becomes. Once start to translate your UI you now have to keep it up-to-date all the time. The more translations you have the more expensive that process is when developing new features, both in actual time/energy to be sure that your UI/UX work well in your supported locales, and expenses for translators.

FWIW, you have to adhere to couple dozen sets of laws as well, on top of translation and regionalization, when building EU-wide products. The EU works to harmonize a lot of these laws, but it's still made of sovereign nation-states.