Why are there no Googles, Microsofts, Twitters, Facebooks etc from UK? | Hacker News Reader

Why are there no Googles, Microsofts, Twitters, Facebooks etc from UK?

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13 pointspclark35 comments

I think its partially due to the size of the market.

Most British startups start out building products for the British market. So they have a 10-20 million target. Once they achieve major success, they figure they'll go overseas.

U.S. startups start out building products for the American market, so they have a 300 million target. And since our version of English is much more prevalent online that target is even higher.

Since growth rates are more or less the same, you have British companies at a disadvantage. While a US company might have 10 million users after 5 years, the same exact company in Britain would only have 100K users.

The market share may be the same, but due to the sheer size of the market, the U.S. company has a lot more customers. And once those customers start paying, the U.S. company has a ton more $$$ to play with to grow even further.

There are obviously a number of exceptions, British companies doing well in the American market. But those are the culturally aware companies, that realize that the British culture is different from the American one.

I echo the scale factor, it is both the chicken and the egg. And the problem is the same, actually much worse, in the whole Europe.

While you are correct that the population of the USA is around 300 million, the population of the UK is roughly 60 million. Of course both numbers are presumably more than the "target" you are talking about, but I think it's safe to say that Great Britain is about 20% of the size of the USA.

Also, I don't understand the growth-rate math. Why would the UK company have 1/100th the number of users?

How much would the variety of English you use on a website alter your traffic? I'm asking because I really don't know. Does anyone have research on this?

I can't point you at research but I've recently found that it does seems like my American friends have a much tougher time understanding British-English than I do as a non-native English speaker and from my experience non-native speakers don't care what version is used as long as it's consistent (for those that care a little at all). Personally I don't really notice if I'm reading American or British English, I only notice when it's pronounced.

I too would love to see research.

You're right that it's to do with the size of the market - 300 million potential customers is a huge amount of growing room.

However, the UK has 60 million people, not 20 million (I thought you were talking about the adult population, but you referred to the total population of the US). Also, the difference between US and British English is so slight as to be irrelevant.

I think the lack of a large domestic market is one cause, however I'm going to say the main reason is that we don't have a Valley in the UK.

That's an important factor. Interestingly enough Israel seems to benefit from its non-existing domestic market. Even small companies there have to target international markets right from the start.

But this should not be a factor to web companies like the ones mentioned in the title. We are running our company from Denmark, but on a .com domain and in English.

There are some differences like accounting, legal counselling, etc. - the infrastructure for that here is definitely not Silicon Valley level. But the market is not one of them, in my view. So it's really just up to our ability to execute (yikes!)

For Google, Twitter, and Facebook, the main reason is that there are fewer and more conservative investors in the UK. Google and Facebook in particular seemed super risky at first, and were only able to raise money from angels, even in the Valley.

Microsoft is a different case. They're a generation older, and didn't rely on investors. They were in the US because the microcomputer revolution happened mainly in the US. The reasons for that are complicated, including the fact that the British government interfered with (in both the British and American senses) the British computer industry, and that getting rich was effectively banned in the UK at the time the startup was being invented in the US.

In my own limited experience with brits I've found that culturally they love creativity but only within conventional constraints. If you try to do something that is really subversive I've gotten this "who do you think you are?!" kind of attitude. They just generally don't share this American sense of "you can be anything you want to be!" Just a contributing factor.

Just want to point out Banksy and his best selling Wall and Piece. Shows the depths of the "subversive" art scene here in the UK. From what I can tell the creative industries here in the UK are not as few and far between nor as obsequious as it might seem. I think it's harder to access and with less momentum, but then that's in comparison to a trundling behemoth shouting "Follow me!!!" at the top of it's voice....

The US strikes me as having less aversion to financial risk than any other nation.

It's how they get into trouble (economic downturn) but it's also how they pump out true innovation.

The US also has an overall aversion towards the distribution of wealth. If you make money, you keep more of it there than in many other countries.

That attracts the people who want to be financially successful. And when you have more of those people around, the more likely something good is going to happen.

Go big or go home? They live it.

Clearly they have societal issues, but the US is a great place to be if you've got money and talent. If you don't have those things, live somewhere else. . . .

Spotify are UK / Swedish. I think they'll be bigger than Twitter.

not when they block U.S. ips due to licensing issues

So did Apple when iTunes first came out. They'll make the deals and resolve each territory step by step.

Music in general, perhaps surprisingly, is one of the areas where European startups tend to fare rather well.

As a Brit who moved to the US, I blogged my personal take on this a few days ago: http://petewarden.typepad.com/searchbrowser/2009/07/you-cant...

IMDb is, well, a worldwide collaboration, but if pressed I'd say the driving force was primarily British. (With help from America, Italy, Australia, Germany, and a few other geeks of the day.) I suppose obsessive data gathering is consistent with the stereotypical British mindset.

(It's been long since bought by Amazon, an American company, but a large portion of IMDb employees are still in the UK.)

All things considered, though, my guess is that it has a lot less to do with national character, and a lot more to do with the fact that the Valley is an oddity. It's a great place to find exactly the right mix of people to make a startup work, from potential smart employees to investors to experienced folks who can give key advice. A startup in San Jose has a better chance at making it out alive than one in London. And a fair number of entrepreneurs head to the Valley from around the world for just that reason - the statistics are hard to gather, but if you were to figure out what percentage of startup _founders_ were British, of successful companies, the gap would narrow considerably.

I'm currently at an awesome company in the Washington DC area (thinkgeek.com, a Hacker favorite!) and we're having a real hard time finding competent senior Perl people who are willing to live out here. I'm sure we'd have no problems in Palo Alto. (I lived there for most of the 90s. And would again, happily.)

Can't speak for the UK. In the Netherlands we have Hyves instead of Facebook, Marktplaats instead of eBay, bol.com instead of Amazon, and even the most popular search engine was Dutch for a long time (ilse). The problem is it's hard for these companies to enter foreign markets with such a limited base.

Last.fm is/was British

With an Austrian co-founder; employees were a European/international hodgepodge; so, not necessarily brits in a strict sense.

Perhaps so, but based in Britain (London, to be precise).

As for Google, Autonomy had Kenjin.

I think in the UK people are just after a career, and I know people who wouldn't work on a speculative software project without applying for grants (eg, free money).

The other problem is that VC's will probably only give to Cambridge/Oxford grads.

I read in some place: "You need a PhD to turn research into a product" (in the UK).

All quite true. I like the British and lived there a long time but there's a bias against startups and small companies which makes it hard to get the ball rolling. Also, it's true that the grant culture is heavily embedded - partly because of the social system, but also because the cost of living in the UK is relatively high. Remember that in the UK as with most other European countries, sales tax is close to 20%. In general, I'd say living in London is about 50% more expensive than living in San Francisco.

This might be part of it. I study at a UK university and it seems a lot of people expect to apply for a graduate placement at some blue-chip company when they finish their studies - starting up is rarely seen as an option. (Though I know a few people at Warwick who are trying to get a startup community together there - google OoTheNigerian for one)

Can anyone from America say if entrepeneurial ambitions are evenly distributed, or are places like Stanford special cases?

I think it is pretty much for the same reason why there are relatively little startups in Ohio or Wisconsin or South Dakota or younameit compare to the bay area. There's a nice piece from PG online where he counts the most common reasons why people do not start startups. The first 10 are, on my view, very personal: 1. Too young 2. Too inexperienced 3. Not determined enough 4. Not smart enough 5. Know nothing about business 6. No cofounder 7. No idea 8. No room for more startups 9. Family to support 10. Independently wealthy

The last 6, which apparently are the most powerful inhibitors, are rather "social" IMO

    11. Not ready for commitment
    12. Need for structure
    13. Fear of uncertainty
    14. Don't realize what you're avoiding
    15. Parents want you to be a doctor
    16. A job is the default

I believe these latter are particularly influential in most European countries.

Many British entrepreneurs travel to California, like many other entrepreneurs from around the world and like many non Californians within the USA. Brits and other non Americans are well represented at the places mentioned and other Valley start ups.

At least one of my most admired companies, Autonomy, is UK based.

pg wrote an excellent article on "Why Startups Condense In America" http://www.paulgraham.com/america.html

They already invented the web.

I think that was the Swiss.

Ah there you go, TBL is English. I stand corrected.

Legal might be part of it. UK/EU libel laws, etc.

I don't think litigation risk is greater in Europe than in the US at all.

Apricot Computers was awesome. ARM, BBC Micro, Acorn.

Definitely Psion in there too!

Oh, and Symbian is the British 'iPhone/Smartphone'.

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