It's strange how quick people are to condemn monopolies and yet in the same breath insist that starting businesses is not a social good. Of course it's a social good, how do you think competition happens other than by starting businesses?
Does the US have a higher quality of life than Germany, France or the Netherlands?
I agree that innovation is important and societies should promote it, but -imho- not at the cost of consumer & employee protection.
I would argue almost everywhere in the world quality of life is fantastic if you are rich. What is the huge difference between living in a gated community in California to doing it in Thailand?
I have the feeling, and again, I do not live there so I cannot be sure (and can you be even if you live there?) But from books, docus and US friends, the difference is not 1000x even. It is just another world. That is simply not true here.
I guess it is a matter of taste if you can stomach that inequality. I walked (yes, strange EU thing where one uses legs instead of wheels) through some part of Fort Lauderdale and it looked like a bloody war zone. I could not live in a country that permits that. Your have poor here but that is exclusively mentally challenged(or what is the current PC term?) People who get help but always fall back, and very few of them. I recognize the vagrants in my home city from decades ago: still the same people: they have a state provided house and get help but it does not help. You cannot fix that. But rows of addicts turned criminals lining the streets in tents and worse. In the richest country on earth. Rich people should be ashamed that happens on their doorstep. They can and should fix it today.
Your snarky comment is just pretentious cherry-picking. I can walk you through some neighborhoods in France, Sweden and the UK where you'd also wouldn't want to live.
And it is not cherry picking: I know those places too: I do not count the UK as that is another Anglo Saxon country so it seems to copy the US values faster (like Australia where the best city in the world to live apparently, Melbourne, I literally trip over the drug addicts in every street and I go there a lot). And yes, there are places enough I would not want to live but they do not look quite as bad as some things I have seen in the US which were more akin to New Delhi. Maybe I did not travel enough and also not the point; if you are the richest country in the world you simply cannot allow that. In my opinion of course.
Of course, all of that is still very much generalization, and I find comparing quality of life in Europe with US is more or less dick measure contest. You try one when there are no fact based arguments to talk about. NHS versus Medicaid, for example, that's could be a good debate.
On this site most people are wealthy, but I think (not sure but I have nothing else than my visits and documentaries), you are really bad off if you are poor in the US. Here that is not really an issue.
https://en.wikipedia.org/wiki/World_Happiness_Report#2020_re...
And let's face it - the sort of businesses that HN readers want to start up are rarely that simple. Most people here are dealing with equity, vesting, cliffs, angel investors, VC money, cross-state and international taxation etc. We're not put off by something being a bit harder. Why should other people be?
So, while you're right that there might be fewer businesses, the EU doesn't actually stop people starting if they really want to.
It's also worth pointing out that if someone is falling at the hurdle of just registering and starting a company then the chance of success is very low. There are going to be much harder challenges ahead even where company formation is complicated.
It's also worth noting that some parts of the EU make it a lot easier to start even than the US. Estonia's e-residency programme makes it incredibly easy to register for limited citizenship and start a digital business based there.
The problem though is financing, French investors for example are really stingy and you won’t get somebody to just throw a few millions at you to see if you succeed.
France has decided to build the “French Silicon Valley” multiple times by grouping schools and companies together, providing facilities and so on. But it always fails because there is no VC money pool.
If you start a company here, better think about profitability from the get go.
Which is mostly real-estate
Isn't that...normal? Where did the attitude come from - that startups are somehow entitled to funding worth of several lifetime median incomes, for their half-baked business ideas that are unlikely to ever turn profit? That if the country doesn't shower the founders with angel investor money just for showing up, they are somehow unreasonably risk-averse and stingy.
As an example - Docker, arguably the most influential software of the past decade, was developed in France. HN has derided French investors for not investing in it, leading to the company relocation to US. Afaik, Docker is still burning money, with no end in sight, and will continue to do so indefinitely unless a buyout at ridiculous valuation happens. Looks like...the stingy French investors were right after all...
I definitely think that there is some middle ground to find between not being able to rise money for any project, and being able to get 100M funding for a juicer.
How is this a bad thing? Compare this requirement to, say, Uber, who has been losing billions, and has used investor money to engage in price dumping to corner the market.
However there is a case when you need money to actually do things, e.g.: pay employees, run clinical trials, rent or build up production capacity. If you don't have initial funds then you will be bogged down by doing contract work to hopefully fund your idea one day. It will slow you down and also quite possibly tangle you in support contracts in products you don't actually want to maintain.
My feeling is that the absolute vast majority of tech startups in the US are of the second kind.
> However there is a case when you need money to actually do things, e.g.: pay employees, run clinical trials, rent or build up production capacity. If you don't have initial funds
This has always been the case. Until unlimited US money perverted the incentives to become "waste billions to corner the market by barely legal means" or "wasted billions until someone buys you".
Let's take a look at YC companies, which is representative to the kind of startups we're talking about here. Do you think the majority of them get the funding to burn and subsidize the 10%?
Doordash losses: 204 million in 2018, 667 million in 2019, 461 million in 2020. 1.2 billion dollars in losses over three years. [1]
Cruise: Hard to find any data (the name doesn't help). Raised billions while producing zilch. Was acquired by GM, and is now generating only losses to the tune of 200-300 million dollars per quarter. That is, losses of around 1 billion dollars per year [2]
Instacart: Doesn't publish profitability (suprised Fry face). Had it's first profitable year in 7 years in 2020. In 2019 lost 300 million dollars. Previous data unavailable.
Should I go on?
Even the proftable darlings are usually profitable if you look at them right.
AirBnB: up and down, up and down. Sometimes down with losses up to 674 million dollars a year: [4]
Dropbox: became profitable only last year. Prior to that? Well, losses up to 484 million dollars of losses per year [5]
And so on.
The vast majority is fuelled by litrerally endless investor money with only two modes of operation: corner the market (that is, outlive other competitors who don't have such an unlimited amount of money) or get sold.
[1] https://www.businessofapps.com/data/doordash-statistics/
[2] https://www.statista.com/statistics/1077077/gm-cruise-operat...
[3] https://www.businessofapps.com/data/instacart-statistics/
If I were to identify one big flaw, it would be that EU governments don't recognize that small businesses can't do regulatory compliance as much, so they should be exempted. Or you get no small business formation that can turn into large businesses.
The cost/effort of running a tiny deadbeat company in Europe can be very marginal (I run one). That's how all plumbers and carpenters and car mechanics run their businesses: if they can you can too.
Sounds like you could easily justify soviet bureaucracy with that logic.
> It's also worth pointing out that if someone is falling at the hurdle of just registering and starting a company then the chance of success is very low
You're not wrong about this specifically. But why would I open in a difficult country if I can open in an easy country?
Case in point as mentioned elsewhere: we actually have ISP competition here.
However, upload speeds are still a joke in the US - I can’t buy more than 35mbps up, period. That comes with 1gbps down (in reality that’s never stable, so more like 800-900mbps). At previous home I had options of two providers with one offering symmetrical 1gbps fiber - that’s fairly rare in US.
Costs are another issue - US ~$61 per month, OECD average is ~$37: https://www.broadbandsearch.net/blog/internet-costs-compared...
Now this is mostly services innovation, not telecom tech itself, but still has very tangible benefits to consumers and barriers to operating a business.
Well it has produced the top tech companies and (most of the) top research universities in the world. So pretty well.
Not even the tax money of those "top tech companies". Heck, some of those come to us (e.g. Ireland).
As for their products, we can buy them just fine as well.
As a result we have much better mobile plans for example. Every time I see a Ting ad I marvel at how expensive their plans are, and then they compare that to the likes of Verizon…
Kind of like AT&T, Alphabet, Comcast and Disney?
Not to invoke whataboutism, but wealth concentration is as much of an issue in the US, if not more.
No businesses means no wealth to redistribute which means no safety net.
They are literally the bedrock of the entire system. So yes, society should place massive importance on making it easy for them to operate.
2. People with jobs pay taxes. As do the companies themselves.
3. Taxes pay for social safety net?
Sounds credible in theory, but the reality is that despite it being harder in the EU than the US to start a company, the safety net is much stronger in the EU. So there must be something wrong in that theory.
What I claimed is without jobs and companies (economic activity) you cant collect taxes which pay for social safety nets.
Am I wrong? Or is there magic fairy dust to pay for a social safety net I don’t know about?
That implies that making it easier top start a business is a requirement for the safety net; after all, you wrote that funding for the safety net is the reason creating companies should be made easy.
It follows that wherever there is funding for a safety net, businesses are easy to start. So how come that in Europe businesses are -allegedly- so hard to start, but there is a strong social safety net?
TL;DR: Europe is proof that it's possible to have a certain level of regulation to business while still having enough successful businesses to fund a strong social safety net.