Do we actually want people to "exit" in this way though? That seems to just make more millionaires, and further centralise control of good technologies / ideas.
I don't think it is quite that black. There are plenty of good companies and nice people that make bank from starting new companies. The hype and the bro-culture are not the only faces the start-up community has and if that all you see then you're missing a lot of the good that is happening: Female / minority participation in start-ups is substantially above country average for most countries in Western Europe, there are quite a few start-ups that are working hard to achieve something good for the world, but not in an 'Instagram' like manner kind of 'good for the world'.
SMEs are the backbone of private enterprise in Europe, they create more jobs and employ more people than all of the enterprises combined. They are the backbone of the economy and I'm more than happy to see a thriving eco-system around them.
SME aren't startups, quite the opposite. And my gripe with startups lays in the difference between those two. A regular company makes business, at some scale, and sometimes grow because they were efficient and profitable. They are the realm of people knowing their business and their market.
Startups raise funds, try to build a big scale business as fast as possible and sometimes become profitable because they became big enough fast enough. Move fast, break things (first websites, now satellites and automated cars, YOLO) and become rich ASAP please.
That's what people are trying to tell each other but it's BS. For every start-up that made it there are 1000 SME's that didn't. Usually you only know that your company has the potential to succeed big quite a few years after you've started it.
The whole idea that world wide scale companies are the only ones that deserve the label 'start-up' should die, it's a SV born re-purposing of words to suit a particular agenda.
Startups raise funds, try to build a big scale business as fast as possible and sometimes become profitable because they became big enough fast enough.
Right, a source of far too much capital put into hair-brained ideas because most of the time it's capital controlled by people with more money than sense.
If we taxed people sensibly and spread it around, then there would be a lot more capital available to the average person wishing to start a business.
because most of the time it's capital controlled by people with more money than sense.
For that you go to Softbank.
If we taxed people sensibly and spread it around, then there would be a lot more capital available to the average person wishing to start a business.
I don't see how that would work over and beyond what we do today: have government secured funds with strings attached. Given the choice I'd take VC or PE based capital over a government backed fund.
You can't 'spread it around' without taxing more. VC/PE is cheap: it is money on which taxes have already been paid and if it does not work then it's their loss, not society's loss.
Besides that the average amount of capital required to start a company is very low these days, but still much higher than the amount at which these government funds typically kick in unless they are co-investing in a larger ticket.
VC/PE is cheap: it is money on which taxes have already been paid and if it does not work then it's their loss, not society's loss.
Society has already lost that money when the income wasn't taxed as heavily as it could have been.
Given the choice I'd take VC or PE based capital over a government backed fund.
If we spread money about through some kind of basic income then it wouldn't be government funds, it would be crowdfunding and community lending schemes.
Yes, that's because those big American corporations have found it rather hard to roll out effectively in Europe due to multi-lingual, multi-currency and multi-cultural issues.
You're answering why American invest in those European start-up, but my point was the lack of exits not involving American companies. The number of IPOs of European startups is really low compared to the US.
That's because usually long before an IPO opportunity rolls around there have been a lot of feelers from US based companies looking to buy market share.
This is one of the reasons why I am worried that GitLab will end up selling to a US based company. Time will tell if they hold strong, if they do I'll be sure to buy stock in their eventual IPO just as a reward for showing that a US exit is not the only avenue available.
I can't talk about every European countries, but this comment offers a really shallow analysis of the late stage funding situation regarding France at least.
The differences between France and the US, in terms of Culture, wealth distribution, financial and fiscal environment, country size (& heterogeneity of the European market) are really important factors, much more than “the American always shoot first”.
I can't talk about every European countries, but this comment offers a really shallow analysis of the late stage funding situation regarding France at least.
And your comment shows that you probably missed that the conversation had shifted away from France in particular. GitLab is Dutch for example.
The differences between France and the US, in terms of Culture, wealth distribution, financial and fiscal environment, country size (& heterogeneity of the European market) are really important factors
Yes they are. For one, French - very capable - possible entrepreneur will be the last to see themselves succeed independently, they will jump t the first opportunity to work for some crap salary for a large company who will then make lots of money over their life's worth in contributions. And if you're lucky you too will get a golden pen on your day of graduation: the day you get to collect your pension.
And as for Americans shooting first: for all the flak that the Samwer brothers get for copying American concepts in Europe, there are plenty of companies in the United States that came late to the table. Facebook isn't the first social network, it just executed better and with much more capital, and there are many other examples besides.
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That's nonsense. Lots of start-ups are getting funded in the EU without' miles of red tape and/or friends in the right places'.
I see lots of them (50+) every year.
Early funds are easy here in Europe. But exit over 100M are scarce and often involve an American big corp.
Do we actually want people to "exit" in this way though? That seems to just make more millionaires, and further centralise control of good technologies / ideas.
Personally no, I don't and I consider the whole start-up culture harmful.
But I wanted to highlight the key difference between European and American start-up ecosystem regarding funding.
I don't think it is quite that black. There are plenty of good companies and nice people that make bank from starting new companies. The hype and the bro-culture are not the only faces the start-up community has and if that all you see then you're missing a lot of the good that is happening: Female / minority participation in start-ups is substantially above country average for most countries in Western Europe, there are quite a few start-ups that are working hard to achieve something good for the world, but not in an 'Instagram' like manner kind of 'good for the world'.
SMEs are the backbone of private enterprise in Europe, they create more jobs and employ more people than all of the enterprises combined. They are the backbone of the economy and I'm more than happy to see a thriving eco-system around them.
SME aren't startups, quite the opposite. And my gripe with startups lays in the difference between those two. A regular company makes business, at some scale, and sometimes grow because they were efficient and profitable. They are the realm of people knowing their business and their market.
Startups raise funds, try to build a big scale business as fast as possible and sometimes become profitable because they became big enough fast enough. Move fast, break things (first websites, now satellites and automated cars, YOLO) and become rich ASAP please.
That's what people are trying to tell each other but it's BS. For every start-up that made it there are 1000 SME's that didn't. Usually you only know that your company has the potential to succeed big quite a few years after you've started it.
The whole idea that world wide scale companies are the only ones that deserve the label 'start-up' should die, it's a SV born re-purposing of words to suit a particular agenda.
They can, but they don't have to.
Those millionaires then tend to go on to fund the next wave.
If you're thinking of SV as a source of tech then you are missing the point: SV is a source of capital.
Right, a source of far too much capital put into hair-brained ideas because most of the time it's capital controlled by people with more money than sense.
If we taxed people sensibly and spread it around, then there would be a lot more capital available to the average person wishing to start a business.
For that you go to Softbank.
I don't see how that would work over and beyond what we do today: have government secured funds with strings attached. Given the choice I'd take VC or PE based capital over a government backed fund.
You can't 'spread it around' without taxing more. VC/PE is cheap: it is money on which taxes have already been paid and if it does not work then it's their loss, not society's loss.
Besides that the average amount of capital required to start a company is very low these days, but still much higher than the amount at which these government funds typically kick in unless they are co-investing in a larger ticket.
Well let's tax more then.
Society has already lost that money when the income wasn't taxed as heavily as it could have been.
If we spread money about through some kind of basic income then it wouldn't be government funds, it would be crowdfunding and community lending schemes.
Yes, that's because those big American corporations have found it rather hard to roll out effectively in Europe due to multi-lingual, multi-currency and multi-cultural issues.
You're answering why American invest in those European start-up, but my point was the lack of exits not involving American companies. The number of IPOs of European startups is really low compared to the US.
That's because usually long before an IPO opportunity rolls around there have been a lot of feelers from US based companies looking to buy market share.
This is one of the reasons why I am worried that GitLab will end up selling to a US based company. Time will tell if they hold strong, if they do I'll be sure to buy stock in their eventual IPO just as a reward for showing that a US exit is not the only avenue available.
Hi GitLab employee, I can assure you we won't sell out, Sid our CEO is very adamant about going public in 2020 and we're currently on track (actually ahead of it wooo) https://about.gitlab.com/handbook/being-a-public-company/
Also FYI, Sid is Dutch but we're registered in the US, although our entire company is remote :)
I can't talk about every European countries, but this comment offers a really shallow analysis of the late stage funding situation regarding France at least.
The differences between France and the US, in terms of Culture, wealth distribution, financial and fiscal environment, country size (& heterogeneity of the European market) are really important factors, much more than “the American always shoot first”.
And your comment shows that you probably missed that the conversation had shifted away from France in particular. GitLab is Dutch for example.
Yes they are. For one, French - very capable - possible entrepreneur will be the last to see themselves succeed independently, they will jump t the first opportunity to work for some crap salary for a large company who will then make lots of money over their life's worth in contributions. And if you're lucky you too will get a golden pen on your day of graduation: the day you get to collect your pension.
And as for Americans shooting first: for all the flak that the Samwer brothers get for copying American concepts in Europe, there are plenty of companies in the United States that came late to the table. Facebook isn't the first social network, it just executed better and with much more capital, and there are many other examples besides.