interesting article by 1000startupseu prompted by a set of workshops run by the European Commission workshop about financing startups in EU and how to build startups that scale.
these are among the issues the come up
- 28 markets in the EU versus 1 in the USA
- not enough successful startup stories in the EU that have earned a lot of money for their investors. Money will go where money will grow
- Risk aversion – much bigger market risk -> bigger risk for everybody in a chain, from entrepreneurs to investors.
- Small valuations
- No exits for startups made by the EU corporates
- Corporates don’t buy from startups in the EU
They do list some suggestions to help encourage EU cross-boder seed / angel investing based on EU grants that are worth reading also.
Reasons why we have startup situation like this in the EU – Everything has its reasons and everything is logical! Why are people from the EU moving to the US to make their dreams come true? It is happening for more than 200 years… It is because it is easier to make success in the US than in the EU - not harder, but easier! Divide EU on the 28 different countries and you will get 28 smaller markets, none bigger than 100 M people (the biggest is Germany with 81.3 M, mean is Sweden with 9.8 M). Through the history, did business need VC investments to grow on a market with a population up to 10 M people, or is it enough to take a loan from a bank and keep 100% of equity?
