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Comment by ThomPete | Hacker News Reader

Because failure is much more expensive to European investors and it's not as easy to build huge successes in Europe.

So if they did they would quickly be out of money.

This is why the Samwer Brothers from Rocket Internet is doing things the way they are and can have so many startups they do.

Their copy-cat approach is very un-european but in reality the only way for European investors to be less risk-averse.

The safty-net comes with a price. Even in Denmark which is rated as on of the easiest ways to start a business the reality is that it might be easy to start a business, but it's very hard to scale it.

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>> "it's not as easy to build huge successes in Europe."

Why? Could you explain this further?

Here is just a short list.

a) Different cultures

b) Different languages

c) Different tax systems

d) Different company types

e) Different legality

All these in combination creates a lot of friction that makes it harder. There are obviously exceptions (ex. skype) but in general it's just very hard to navigate compared to the US.

Most kids are (and have been for a while) taught English in schools. If you create your site with English as the first language you can target most European countries + the US. Regarding company types you set up your business in the country you're based in - you don't need a separate company for every country you operate it. I believe the same applies to tax. You pay it in the country you are based in.

Yeah good luck building a startup in europe with that view. There is a reason why ex. Facbook localized their content.

I's a strategy for getting the business going. Obviously you begin localising once you've got some traction.

No, you need localisation to get traction. People are surprisingly fond of their own language, even if they are almost fluent in English. At least if you're dealing with consumers.

If you do localization, don't think only language will cut it.

Address systems, payment systems, "simply taking credit cards" may not cut it.

But in the end you have to launch targeting one or more countries, whatever comes beyond that is "free".

And of course, you start from day 0 to make your system Unicode compliant.

Curiously, charsets actually is less of an issue within EU - Latin1 should cover. (Not that anyone should use that in a modern app today)

But otherwise I agree with your sentiments - Language is just one of several problems. Most of which are external to the product.

The people's English is usually rather bad if they aren't higher educated (e. g. university degree).

None of these are issues that European entrepreneurs I talk to have ever had.

Hi. You're right, no European entrepreneurs talk about these topics, but they are very much implied barriers to entry. What is normally vocalized is the size of their markets - which implies that scaling out to a whole EU launch is much more difficult.

A US SaaS hasn't got tax, legal, culture issues when selling their products in Europe. So how can all of these be issues within the EU?

Have you ever tried to sell something in English to a French company? Have you ever tried to sell something in Russia without "having a connection" to someone? Why does Dropbox have a Irish HQ?[0]

[0]- https://www.dropbox.com/dublin

Cherry pick all you want. Dropbox and others grew to millions without having a multiple-language site, European headquarters, "Russian connections", etc. My business currently sells to the world with an English website, one terms of service, one VAT, and one business location in a non-English speaking country. We are not the only ones.

You can cherry pick all of you want (i.e. your own business). How about Spotify? Why did people in Germany and the UK have to wait years after Sweden already had it (when the technology already existed)? Whereas Rdio in the US was able to tap into 350 million people right off the bat.

Spotify's rollout has nothing to do with the country's laws nor regulation, but due to private commercial agreements between parent record labels and countries' OpCos. Blaming a country's laws and regulations, instead of the private commercial/licensing agreements that stifle content rollout is unheard of. You are mixing two very different topics.

> private commercial/licensing agreements

And who do you think enforces commercial licensing agreements?

Why are you making this argument up? Which governments in the world care about Justin Bieber's latest album release dates, distribution and pricing strategy, etc.? There is NO evidence that governments make studios establish a release date, distribution strategy, pricing strategy, etc. This is a barrier created entirely and solely by the music record industry.

Wow!, Simply wow! You've tried to make an argument on an issue you have no data for, and now you need to make up stories to justify your believes. Wow!

>Why does Dropbox have a Irish HQ?

There are two main reasons why companies set up European HQs in Dublin/Ireland:

1. Avoiding tax. Ireland has a low rate of corporation tax and some fairly large loopholes. See the Double Irish arrangement and the Dutch Sandwich[0] set-ups.

2. Avoiding privacy protection. The data protection authority in Ireland is tiny[1] and severely under-resourced, so finds it hard to enforce European data protection standards which are significantly higher than in the US (which has pretty much zero regulation when it comes to privacy)

[0] https://en.wikipedia.org/wiki/Double_Irish_arrangement

[1] http://i.imgur.com/IKHC2Ud.png - This is the office of the Data Protection Commissioner in Ireland. A tiny office next to a supermarket. This is the authority responsible for policing privacy for dozens of huge multinations in Europe, including Facebook.

they are those i know and projects i been involved with. But hey dont take my word for it. Try it out yourself.

Different media organisations also a factor? A story on the BBC about a popular new thingy might not feature at all on France 24, whereas in the US it might be covered by east and west coast news, getting widespread exposure. Europe has news fire-breaks. High thresholds to jump the synaptic clefts.

Unless I am misunderstanding, all those apply to companies targeting Europe, which isn't the same as being based there.

It's cultural, Europeans don't believe in making something large from nothing. The idea of a kid with a laptop building an international business, as Zuckerberg was doing, is laughable to them. (And delusional.) They'd probably tell him to go back to school so he can get a real job.

Do you have evidence for that at all? Because it sounds like bollocks to me.

The more obvious factors are almost certainly the case - more complex regulatory environment, smaller market, a lower concentration of capital sloshing around than in SV… and myriad other reasons.

Blaming this on an artificial 'European' culture is facile.

I would argue that it not only matters how large you build your ‘business’ and how many billions you make eventually selling it, but also how much you care for your employees, provide value to society and, most importantly, what sort of business you’re building. Instant success is also not necessary, instead, building your business over the course of 150 years is perfectly acceptable.

Facebook is essentially a marketing company and time-wasting website, both of which are not exactly highly regarded as businesses go. On the other hand, there are many highly successful and innovative European companies building actual stuff, often founded decades ago as small family businesses and growing slowly and steadily until they firmly occupy some niche on a global scale.

And, yes, if you don’t have a PhD, how exactly are you going to be different from your secretary?

You're just repeating old stereotypes.

Actually he is 100% right. It's a different cultural behaviour in Europe. In the last 15 years I visited most of Europe and major cities of the world and the mentality is definitely different. Americans are more optimistic than Europeans and they see risk differently. Also, take into account the past, the living standards during the course of history.

While americans were chilling in the 80s and 90s, many countries of Europe were facing communism. People had a harsh life, the parents-grandparents had it, so of course they're not gonna have a Peter Thiel mentality when they don't even know how to shut down a PC. Some countries have an avg. salary of 200$. What the hell are you gonna buy with that? And I'm talking 2013 not 1990. So it's not like they're gonna tell their kids "sure son, after I worked at a farm all my life for 200$/month I strongly believe you'll make an 80 bill.$ company out of a damn computer. Let me go grab my savings and good luck!".

Too much to talk about but europeans know what I mean.

I am European. It's a stereotype.

European from where?It matters...West? You obviously don't know what you're talking about.

I would trust him, someone from Europe, over a person who has "travelled" there. You really need to live in a place to get to know it's culture at anything more that a superficial level.

At a superficial level, for example, Americans seem to believe they are better (possibly due to genetics) than others. This kind of exceptionalism/patriotism is bad.

You've mentioned yourself why this whole article and comments are bollocks. Europe is is no way homogeneous and referring to startups in "Europe" is kind of pointless.

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