I see this as oversimplification. US Tech faces hard regulations too (fintech, healthcare etc...). Also Regulation is not that big of a bump in EU. GDPR simplified rules across 27 different national laws and forced new innovations in privacy. Also Spotify, SAP, Adyen all started in small markets, as counterexamples. The main reasons why USA is ahead I think are the historical advantages (internet, personal computer), the network effects created by the historical advantages and the VC ecosystem. Also the culture for risk tolerance.