I would imagine high taxes and government regulation had something to do with this.
The difference between the countries' investment and startup growth environments goes much deeper and can't be easily summarized by simple political sloganry.
Since you mentioned Nordic countries in general, let's look at Norway:
1) 28% flat tax on income (additional 9% on gross income if you earn between $73,641 - $119,662 and 12% on anything larger than this. 2) VAT on most things you purchase (25%) 3) 1% wealth tax, including your assets. 4) All tax returns are publicized. So everyone knows how much you make. This is a violation of privacy.
source: http://www.davemanuel.com/2009/09/08/the-norwegian-tax-syste...
It's not just corporate taxes that need to be factored in here. If I'm a VC, why would I invest where everything is going to cost 3X or 4X as much.
There also has to be a reason why there is almost no startup scene in Nordic countries. If taxes were great and the government made it really easy for businesses to startup and flourish, VC would be flocking there.
another article: http://www.inc.com/magazine/20110201/in-norway-start-ups-say...
"As a Norwegian, he pays nearly 50 percent of his income to the federal government, along with a substantial additional tax that works out to roughly 1 percent of his total net worth."
"And that's just what he pays directly. Payroll taxes in Norway are double those in the U.S. Sales taxes, at 25 percent, are roughly triple."
This article is filled with reasons why I would never want to start a business here.
By the same logic, no sane VC would invest in a Silicon Valley startup because engineers there are 3-4x more expensive than most other tech hubs.
The Norwegian employee pays a lot of tax, but actually a lot of that money goes to services that directly save money for you (the employer). For example, you don't need to pay for the employee's health insurance, dental care or pension plan, since these are covered by the state.
There also has to be a reason why there is almost no startup scene in Nordic countries.
That's nonsense. By European standards, the startup scene is great at least in Sweden and Finland.
You can get a great plan in the US for around $500-$600/month (an okay plan is considerably less). 30-40%+ more of my income is considerably more than this.
"By the same logic, no sane VC would invest in a Silicon Valley startup because engineers there are 3-4x more expensive than most other tech hubs."
They are more expensive because they are the best talent around.
"That's nonsense. By European standards, the startup scene is great at least in Sweden and Finland."
Compared to what? The statup scene in Michigan is great compared to that of Iowa or Kansas.
In Norway it's over 50% after everything is said and done..and this isn't include the 20% VAT that is paid on almost everything, the 1% "net wealth tax" (which includes real estate, cars, etc), and any other tax you might have to pay.
However, the neighboring Norway has a 1.1% combined wealth tax on income above about $350k. And according to [1] "from the income year 2008 the full market value of shares reg- istered on the stock exchange are in the shareholder’s wealth, whereas unlisted shares are valued based on the company’s taxable wealth".
Other countries that have the wealth tax are France, Switzerland, Liechtenstein, Netherlands and India. Some of them have limits on the wealth tax in place, e.g. in France the amount cannot exceed 50% of annual revenues.
"Taxable wealth is the value of the company's assets reduced by debt, as of 1 January in the assessment year."
This doesn't necessarily mean that the same definition applies at the tax office and/or that it applies to startups, though.
So either you are in USA, where lawyers and accountants deal with SEC requirements everyday; or, you are in Sweden, and have to do things the way Sweden wants you, then, also, do things the way the SEC wants as well. Simply easier and possibly cheaper to be in the USA.