* the regulatory environment is tough on businesses: it's hard to start one and follow all the rules. The rules can also be different across EU states.
* poorer local market. Europeans generally don't have as much disposable income as Americans. It's harder to get a good amount of people to pay 20 EUR / month for a SaaS.
* different investor culture: if you failed once, you'll always fail thinking
* corporate and personal taxes are high, so there's little incentive to work like crazy to become a multimillionaire if you have to pay the bulk of it in tax.
* overall tougher social mobility, making it hard for top talent to get to the right people for funding, ideas, mentoring, etc.
* EU spends public money in attempt to create "unicorns". This feeds a certain class of exploitative business people and paper pushers who have optimized to leech off these programs by building useless things that technically check the boxes in rule books and regulations, in order to get even more public money.
As someone who has a small business in the UK I’d disagree with your first point, at least for the UK. The situation may be different depending on the EU state, but the UK has a fantastic regulatory environment. Clearing imports through customs for example is much more frictionless in the UK than the US.
I’d also disagree on the tax situation. They may be slightly higher than the US but then we also get health care included with that. This is amazing if you want to bootstrap a business, especially if you family or an illness. I have private insurance as well with BUPA but that only costs me $80/month with no deductible I believe.
I think your other points are true to varying degrees but for sure things are changing so they’re probably less true than they were ten years ago.
The biggest reason is probably that the US has California and Silicon Valley.
Comments
I believe it is a combination of things:
* the regulatory environment is tough on businesses: it's hard to start one and follow all the rules. The rules can also be different across EU states.
* poorer local market. Europeans generally don't have as much disposable income as Americans. It's harder to get a good amount of people to pay 20 EUR / month for a SaaS.
* different investor culture: if you failed once, you'll always fail thinking
* corporate and personal taxes are high, so there's little incentive to work like crazy to become a multimillionaire if you have to pay the bulk of it in tax.
* overall tougher social mobility, making it hard for top talent to get to the right people for funding, ideas, mentoring, etc.
* EU spends public money in attempt to create "unicorns". This feeds a certain class of exploitative business people and paper pushers who have optimized to leech off these programs by building useless things that technically check the boxes in rule books and regulations, in order to get even more public money.
As someone who has a small business in the UK I’d disagree with your first point, at least for the UK. The situation may be different depending on the EU state, but the UK has a fantastic regulatory environment. Clearing imports through customs for example is much more frictionless in the UK than the US.
I’d also disagree on the tax situation. They may be slightly higher than the US but then we also get health care included with that. This is amazing if you want to bootstrap a business, especially if you family or an illness. I have private insurance as well with BUPA but that only costs me $80/month with no deductible I believe.
I think your other points are true to varying degrees but for sure things are changing so they’re probably less true than they were ten years ago.
The biggest reason is probably that the US has California and Silicon Valley.