My personal experience, having been involved with many startups in both the EU and US, is that EU government funding is completely useless for almost all startups. Why? First of all, you have to be part of the existing networks. If your business does not have university affiliations with people that get existing grants, or connections to EU bureaucracy, then you can forget about getting a dime. Then there is the risk aspect: if you are doing anything even remotely novel, or with any amount of risk, forget about it. This is not just my opinion, Mario Draghi, previous president of the ECB and Italian PM, said that the EU does not take enough risk to produce real innovation. And finally there's the timelines: from researching funding to cash in your bank account is always measured in years.
So, my expectation is that these funds will be distributed to members of the bureaucratic class and their network, for low-risk, low-reward projects, on a timescale too slow for most startups. I hope to be proven wrong, but the results of previous decades of EU funding programs do not make me optimistic.
There is simply not enough private capital investment in Europe. The public money is inevitably passed through academic hands or other public sector bureaucrats. And it is simply an ineffective way to allocate capital. The money should be returned to private hands where it belongs and those individuals should be the ones to decide how to invest their own capital.
Why do so few Europeans get this? It’s like they just can’t stand the idea of a wealthy person investing their own money.
Look at the early days of YC. Single digit millions a year was enough to stimulate the growth of a whole ecosystem of startups! Some startups are inherently capital-intensive but most don't need that much money to get to the point of basic viability. There are plenty of private individuals in Europe who could support a $10M a year incubator by themselves, not to mention the many institutions that could do this. And yet... there is no European YC and there never was.
I think it's cultural. Go talk to the top students at the top universities in the US and Europe and you will notice plenty of talent on both sides of the Atlantic - yet far different levels of ambition. Now run an experiment; pay ten of those students a hundred EUR/USD to tell everyone that they're dropping out and starting a startup. Watch the parents' reaction. Watch the professors' reaction. Watch the reaction from their doctor, their baker, their crush, their garbageman.
You already know the result, of course, it's obvious. That's your problem; and by comparison, the money hardly matters.
Oh yes. Being a failed entrepreneur is a stigma. Being a very successful entrepreneur is a stigma too. Only being a struggling or moderately successful entrepreneur is acceptable.
Do you believe short-term thinking is essential for successful startups?
because someone else over in the USA dropped out two years earlier than you to do this very same startup, and thus they get a head start.
Unless your novel idea is so completely novel, that nobody else but you could've done it. Most ideas are not this novel, and first mover advantage is real.
Not to mention that to make long term work out, the short term must also work out. It's a stair case - each short term period adds up and turns into long term. It is almost impossible to have a long term plan work out, if the short term is so unsuccessful that you need more funding every year.
So work on the next idea?
Americans just have a borderline delusional self-belief that other cultures really have a hard time matching
The Gulf Arabs are another group with a similar mentality but they don't have the population, freedom or education (yet) to do the same things
Correction, the Gulf Arabs don't. Their autocratic leadership is though. A frequent point of contention between government and public is the private sector - the government wants them all to join the private sector and even provides locals with seed funding for most kinds of businesses. But the locals are rather risk averse and would rather stay in the cushy public sector. The few who are entrepreneurial tend to be extremely entrepreneurial though, and they have a lot of the risk-enabling capital structure in place in Abu Dhabi and Dubai
Consider that the European frontier is either
- west: Americas (already done)
- south: Africa (not gonna happen again)
- north/east: drang nach osten (again, not to be repeated)
- up / down? Perhaps Europe needs to focus on space and mining tech?
Russia has a frontier, and they are pretty strong in engineering, but I doubt that a SV style ecosystem is likely to form, given the… ahem… unique cultural aspects.
All said, I disagree that a frontier experience is necessary: the UK, Germany and Austria-Hungary were massive industrial modernizers while the US was still going through its westward colonization.
Is tech an exceptional field, or just the current SotA in industrial development?
Over time when farming technology improved, people could live self-sufficiently in worse places. Transportation technology changed as well. Railways, highways. And now remote working and data centers. So there have been frontiers also in the old world in that sense. The king of Sweden in the 1500s declared some eastern frontier areas as tax free for some time, as he wanted people to settle there to control those areas (in accords, some of it might have been Russia...). Many places have waxed and waned over the centuries. When Estonia gained independence for the second time, some Finnish farmers went there as there was excellent farmland that was very underutilized.
With modern knowledge you could even build up a great place to live almost anywhere. Good policies and cheap energy. Maybe fresh water is the hardest physical requirement.
Silicon Beach/Alley/Gulf/Islands within America cannot replicate it either
Without a culture of paying it forward as a reckless angel investor sometimes dressed up as a fund, already within the people that made it, none of these ecosystems get off the ground
Notably, Silicon Valley’s earliest winners were from a government funded initiative
I'd phrase it a bit differently -- local (country) regulations, taxes and fees stifle startups in the crib.
This is not a meaningful statement
‘Returning money in private hands’ does not result in more startup investment, it’s not in the culture to do this.
The money will be put into real estate, bonds, or whatever.
Look at London - it has as much wealth as NewYork or LA but all the money just piles up in real estate or Fintech.
But outside those niches? Good luck getting a farm-tech startup funded, no-one will take a punt.
So it falls to the government to try and kickstart something. As flawed as it may be.
Then they put together a competition for funding that basically feels like a school exam
There are so, so many examples of British agtech companies getting funded:
https://www.lettusgrow.com/blog/2020/1/9/press-release-uk-ag...
https://edinburgh-innovations.ed.ac.uk/news/roslin-technolog...
https://fischerfarms.co.uk/fischer-farms-secures-26m-funding...
https://tropic.bio/tropic-biosciences-raises-28-5-million-se...
Uber's Series C was $361M, that's the kind of money you need to put a company on the global map.
why should it fall to the gov't? They're one of the worst funders of startups imho.
In these scenarios, the gov't isn't funding the business via equity, but grants - aka free money. This makes all the wrong incentives. Taxpayers don't feel the loss (not truly, like a private investor would), if the startup fails.
Tax less, and prosperity follows!
https://www.gov.uk/guidance/capital-gains-tax-rates-and-allo...
In California those rates go up to 33.3% (20% federal + 13.3% state).
They are also funded by large public investors like pension funds (American and European) and sovereign wealth funds.
There is just a lot of capital sloshing around in the US, and it's fairly easy to start a firm here. The same isn't true in much of the EU.
The US has issues, but using American issues as an excuse to ignore European issues (which in reality are a result of soverignity tussles) is ridiculous.
[0] - https://hdr.undp.org/data-center/country-insights#/ranks
For average/unambitious or unfortunate/poor people, places like Europe or Canada are much better standard of living
I guess the question becomes, which "Europe" and which "America" are you comparing. And even then, developmentally, the US isn't much different than Western or Northern Europe.
> For average/unambitious or unfortunate/poor people
I mean, youth and normal unemployment remains significantly higher in much of the Europe compared to the US [0][1] and median income after tax remains roughly on par [2], even factoring for purchasing power parity [3].
As a whole, it appears that the US is roughly on par with much of it's peers in Western and Northern Europe, and American problems appear to be overreported and European ones underreported
I personally think there is a lot of glamorization of Europe because more Americans visit Western and Northern Europe as tourists than the other way around, and attribute their tourism experience as that of a normal European, which is an unrealistic assumption.
And it's not like ambitious risk takers don't exist in Europe - look at the startup and dev scene in Sweden, Czechia, Romania, and Poland. It's clearly an institutional problem.
[0] - https://www.cia.gov/the-world-factbook/field/youth-unemploym...
[1] - https://www.cia.gov/the-world-factbook/field/unemployment-ra...
[2] - https://ourworldindata.org/grapher/median-income-after-tax-l...
In my opinion the only real issue the US has is healthcare. In all other ways even for middle class people it's better. People think Canada is some socialized heaven... yet home ownership is MUCH more realistic in say Michigan than it is just across the border in Ontario.
Giving it to academia can 10x the result, but yes research is risky, that's why it's important it is founded externally.
Companies that profited from research in academia are very happy.
Overall I agree, the current European strategy is not optimal, for both Industry and academia.
The stuff in between with sensible risk-reward ratios will indeed be ignored.
On the other hand, most startups have the ability to be total failures. If your social network, or your rocket company, or your new type of airplane collapses, it is a total loss. That is risk.
They have turned something that should be high-risk into something safe with no consequences if there is no progress. Thus there is no progress, because why change things even if we are running into the wrong direction?
PS: I am not so much talking about CERN. CERN is basic science and we need that too. I am talking about projects that should be startups, i.e. commercially driven entities with the end-goal of making money.
I am talking about projects that should be companies with an intent to make profits.
Just out of curiosity, can you throw a couple of examples?
It's non-profit and would not exist without external funding.
The discussion is more about businesses I think.
That was one of the requeriments: to be certified by a university professor. That doesn't make sense: universities are research centers, but not the unique source of innovation (and in our country, not even a source in most fields).
Your comment is pretty on point!
I don't mean to say 70B is not a lot of money, of course it is. But perhaps that's part of the point: it's a lot of money to feed these technology partners of academia and other friends of friends you are talking about, it's also big enough to make the frontpage on HN, but when it's seen as a sudden huge investment into the whole market, it's kinda telling by itself that startups are not exactly thriving in EU. And also that money is cheap now.
Eu has great plans but unable to fulfill them.
I have been waiting for the Capital Markets Union for 11 years.
THe European blockchain infrastructure? Dead because only some universities can use it.
Eu is unable to fund innovation and it's not able to fund risky businesses. No VC culture either.
some Scandinavian countries have a little startup culture and government sponsored grants but the tax system drives startups that serve international audience away.
I would just add this, from my experience with Horizon 2020: we were working on an R&D project at the time. Applied for grant. We got €16,000, peanuts. (We needed a few hundred thousand....) My point is that this type of EC/EU financing is distributed in a somewhat "social-democratic" manner, under the principle of "everyone should get something". Not mentioning the bureaucratic hell we went through to apply and get the funding.
> EIB President Nadia Calviño emphasizes the bank's willingness to take more risks, notably speeding up the venture capital financing process, which could be pivotal for startups in a fast-moving market
> The bank aims to process startup financing applications within six months, significantly improving from the current 18-month timespan.
And this rightfully causes a lot of us to worry that this foreshadows a significant lack of domain experience in the EIB's proposal (which btw hasn't been made public yet)
a quick search at the comments (so far) yielded zero results on "data prot", "GDPR", "privacy", so let me bring those up.
GDPR is a _great_ tool for civilians
GDPR is a _horrible_ tool if you are a business and want to innovate, expand, 'exploit' (positively).
EU money will come with E(U) DP Supervisor and the many directives. There is no way someone can do a proper DPIA and find it 'clean' if you are honestly appraising processes x GDPR. And these people are fierce nay-sayers. I've worked in banks, and I've worked in the EU. Those EU folks shit their pants when the DPOs walk in the room. Say "Legal basis" to someone working in the EU and see them cry (ok I exaggerate).
US has been 'stealing' the talent from all around the planet, for decades (and good for both the US and the talents). Why would someone try hard and have regulations every step of the way, and not work for Google?
Many years now I've felt that US is 30 years back in "tech" and will never catch up. US companies are dominating the space, and for every 10 steps we do in the EU, they go 10 miles, so every last year was better gap-wise. And I fear it won't change.So, then simply get in contact with your local university. It helps the university to get grants when commercial parties are involved, so this is a win-win.
I studied at an excellent Dutch university that's an EU funding darling and had plenty of connections. But because I had "just" a bachelor's degree from a top university, plus substantial relevant experience, nobody would take me seriously. Even with a master's, you will find most people think you are unserious in most "hard" fields. You often need a PhD. And then God help you if you choose to leave the existing ossified structures of academia and industry.
And then you still run up against the issues of risk tolerance (which is zero) and long timelines.
Look, the stated goal of this program is to compete with American venture capital, right? Then look at the founders who got American venture capital money. Look at how many don't even have a bachelor's! Count the number that participated in traditional structures of academia and grant-receiving corporations. Virtually none of those people would have ever gotten a dime of this money, let alone an offer to collaborate from a university.
Its quite a stupid idea that only the most educated people can get these grants because people who excel at academia might not make it in the world of business.
Although there's also NLNet that hands out open source subsidies from the EU. That might be more accessible, although I also get the impression that the money is a lot less. I don't have any experience with it, though.
[1] Dutch Universities spin-off terms: https://www.delftenterprises.nl/wp-content/uploads/2023/07/D...
(Or just use one of the funding mechanisms that attach little or zero weight to academic collaboration)
Honestly, I'd love it if the mail in my inbox from universities wanting to do European projects with us was the result of me being some sort of uniquely-valuable well-connected wizard whereas all the founders had to do was flutter their eyelashes and say "Founders Fund are following on" to get term sheets from everyone in the Valley. But that's not the reality...
In reality there's no shortage of bureaucracy and credentialism if you want Federal contracts (and in some industries plenty of bureaucracy just to do your research in the US even if you don't take any money), and the US exceptionalism when it comes to mindset and regulatory looseness is pretty much the same in the backwater states that don't have any notable startups of their own, whilst Bavaria doesn't seem to be doing too badly for VC investment compared with anywhere that's not California despite the extremes of German bureaucracy. And fundamentally VCs and government funders on both sides of the Atlantic are doing different jobs, with different investment targets and different tradeoffs for founders.
I hope to eventually learn how to engage more constructively with such responses. When someone claims to understand how a system works, yet behaves in a way that contradicts that understanding and then blames the system for not meeting their expectations, I question whether their insight is as deep as they suggest.
A dutch sociologist has coined a term for this calling it network corruption, we had to invent a word for it because it is so prevalent, there isn't even a page about this on the English language Wikipedia: https://nl.wikipedia.org/wiki/Netwerkcorruptie
I think a more useful description: it is an ossified structure where you have to play by the rules. Much like, say, the Catholic Church. You're not going to get a grant for your startup, or become Archbishop of Salzburg, by having an idea and sending some emails. You're going to have to fully commit yourself to the institution over a period of decades, and then you're in, and you're respected, and you can do some things, as long as they're not too revolutionary. Is that good for innovation? No. But corruption? I think it's something else.
Since it'd be obviously bad (sarcasm) if public money were spent on projects that deliver nothing or the people receiving them used them for anything other than the narrowest interpretation of the goal then you absolutely (sarcasm^2) have to have 50 different layers of checks and plans and assessment to make sure the little money is spent on the entities that lie the best. But at least no opposition politician can complain someone bought a fancier watch than they'd like or didn't deliver enough
Anyway the EIB is a different kind of funding process than EU grants and should be more effective (even just because capital doesn't come out of the EU budget or member states directly), though how much I don't know
So leave me be very skeptical about this news.
That's the best case. Then there is outright fraud:
https://cordis.europa.eu/project/id/101092295 - European dynamic provides some project management and a wordpress-page for the lump sum of 800k€ and of course there is always "SOCIAL OPEN AND INCLUSIVE INNOVATION ASTIKI MI KERDOSKOPIKI ETAIREIA" headquartered here: https://inclusinn.com/. Probably still in stealth mode, using the 4M€ to "promote innovation".
Is cynicism about motives necessary?
I believe most people have enough self-deception and denial, that we don't need to assume fraud or theft. Similarly charities often end up being self-serving leeches - but the people seem to believe they are helping. Maybe I'm just naive? It is possible that most people in New Zealand are not so focused on intentional theft and fraud?
In New Zealand I've watched our government burn fucktons of money trying to invest in university "innovation". Academics convince politicians that they have valuable ideas, and politicians want to believe universities produce value. However the government funding is horrifically managed (no business sense) and the startups lack the right genetics and fail (even if matched funding from private investors). New Zealanders lack an entrepreneurial learning environment (maybe EU is the same): founding is difficult and really difficult if you've never watched someone close succeed.
I believe the root cause is that academics are not business/financially oriented, so the startups fail because they are not businesses. Plus the organisations picking investments are academic heavy and are not run by good capitalists. Academics often have good valuable ideas. But academics tend not to be hyper-focused just on business outcomes or they are not money focused. Business founders need to focus on profit (not status hunting, and definitely not looking for academic recognition).
I wondered for a while whether the cause was my own selection bias (startups mostly fail so I saw them fail) but I don't think that was the cause.
Also the government investing organisations love heavy handed shitty governance (and legal overcontrol bullshit). The principals believe their advice and overview is valuable. The investors put in bad CEOs and also force the businesses to make poor decisions. I've seen private VC funding make the same mistakes.
It is really sad to see good ideas get murdered by people with government money: I'm sure they believe they are helping and that they are trying to help (I'm not that cynical about motivations).
Our current government has just announced another 100 million to go towards academic startups. I just fucking wish our government would spend the budget instead by removing unnecessary red tape and to improve tax incentives (in New Zealand the incentives to grow businesses or create export income are fucked in my personal experience).
I’m not seeing EU grants in that list. In general I’d say anything the bureaucrats can’t ruin with their gatekeeping, friendship corruption and overvaluation of social status is a positive. Anything they can ruin they will.
* If the result is good and useful, the credit goes to the member state.
* If the result isn't good, it's the fault of the EU.
Similarly how good Champaigne can only come from one place ;)
In contrast, private investors have more discretion and fewer stakeholders to answer to.
You could go on unemployment and cost them for a year or two, and they instead subsidize you starting a business for 6-12 months to the same amount. Worst case, you fail, and they spent the same amount they would have nevertheless.
Low-interest loans you won't get without taking on personal liability for your business loan. It's low-cost capital, but it's also low risk.
Tax-delays/exemptions for small companies isn't a big bet, it's risking a fraction of a fraction of a percent.
Venture investments by the government is rare (for good reasons, it'd be a huge opportunity for corruption).
For start-ups they do a lot of online calls to ask "what do you need" though. When you say money, they are like, yeah but what do you need except money!?
My cynical side says that it will just be politicized, so some factions can say EU/state bad, while others jump through hoops to defend it.
I know you’re just quoting the rules, but I’m noticing the same process happening here. It would be a shame if HN continued this trend while everyone stayed silent.
In my opinion that comment got downvoted because it’s not interesting. It’s a comment I have heard dozens of times, did not provide any example or source, and plenty other people posted effectively the same in here.
It, in turn, appears to be a promotion of one of the site guidelines. In turn I would promote the official guideline:
"On-Topic: Anything that good hackers would find interesting"
as well as the not-official personal guideline:
"Guideline-lawering is boring, and uninteresting to any good hacker, or true codesman."
> is off topic in regards to EU and tech funding
cool, then it's a tangent to the original topic, as is your own comment policing. Who made you the voice of HN?
The fact that I read and understood the guidelines? If I had not said that someone else would have.
BTW "On-Topic: Anything that good hackers would find interesting" refers to submissions, not comments.
I have seen first hand, one of my classmates from high-school, whom I didn't consider to be too bright, receive a 100k EUR grant to build an esports platform that ended up being a styled-up wordpress blog. He had zero interest in tech, never programmed, the works...
He had no interest nor knowledge relating to tech, but managed to somehow get that grant. Meanwhile, I was paying taxes on hard earned freelancing dev money. We were both 23 years old at the time and it was really jarring.
I'd rather they cut taxes for already profitable small companies. The taxes in EU are astronomic.
What's different from the EU and US is that the US has single capital market with more unified regulations where it is much easier to pool infinite VC money into an idea. Contrary to popular belief it's actually the LACK of EU regulations that makes the EU less competitive, because a company has to deal with 20+ regulatory bodies.
In short, the EU should focus on more market integration.
A civilian airplane manufacturing business takes decades to get off the ground, and is practically impossible to start without heavy government involvement. Cars are not that far behind. How did you pick these as businesses that "bootstrap themselves"? Bootstrapping requires a non-capital intensive business model. These are the opposite. These are businesses running on decades of momentum and government support.
You mean the cars whose manufacturing has to be stopped because they don't know how to use one chip in pace of another, while Tesla was chugging in numbers because they were the only ones who knows how to program a new chip.
On the other hand the EIB (which is anyway not directly controlled in their executive actions by the EU) can grant funds since it's kind of it's role as an investment bank
Because then these communists wouldn't get to choose who gets the money.
Funding will not fix the fact that euro salaries are not even remotely competitive especially after tax. Maybe it’s better to be poor in europe than America but MLEs at large AI labs and bigtech SWEs are definitively not.
Plus, capital is somehow still more risk-averse in the EU despite the ECB's policy rate consistently running >200bps lower than fed funds. And of course the process of getting funds from the EIB remains agonizing even with this change.
All of which is to say, I don't think lack of Software Engineering talent is the problem.
Not in your bubble: top university in the tax heaven EU country with some of the most US companies. Of course those grads can just stay and get FANG jobs there but not everyone comes from the NL.
>the people running succesfull startups in the US do not posess any particular brilliance
Their advantage is easier access to more capital than those in the EU. Capital helps with success even more than skills. Hence why the US has more big successful companies than Europe.
That's objectively false. EU would love to have its own monopolistic companies in the tech sector the same way it has in other sectors. It's only against them because it has none.
> as was demonstrated by DMA
Europe's DMA is orthogonal to its wishes of having monopolistic companies as all of those companies are American not European.
Why do you think bubbles don't exist. People's perception of reality is shaped by their own experience within their immediate proximity and network of people.
> Secondly, if your assesment is remotely true, shouldn't every european software engineer be moving to the netherlands to work at these mythical FANG locations? Has that happened?
A lot of EU people used to move to the NL for tech jobs at big US companies like Uber. Obviously the NL can't house every single person from EU as evident from the NL's housing crisis, nor is every EU worker willing to relocate to NL.
Will Calviño be picking and choosing the grantees?
This is the equivalent of private equity installing someone who knows nothing but MBA material at a biotech company or a ML research company or anything else where domain expertise can actually help.
The EU is actually better at bringing in bits of "technocracy" to let industry experts lend their expertise. I don't know why they are doing that here. I think it's the wrong call.
If you're talking about the domain of startups and companies themselves though, I'll give you that
I am in fact talking about start-ups and tech as a domain. That’s the area at issue so they should hire euros who understand those challenges well to fix them.
What does this mean? I can't parse it.
I think that's different to someone allocating public funds well. In my very limited experience of that in the UK, the people involved were completely unaware of what to do, and were convinced by salespeople and partisan semi-internal contractors with a bias. If Elon Musk wants to risk his own money on an internal decision at Twitter, so be it. That's a lot better than risking somebody else's money forcibly extracted from their pockets.
I answered because the guy above me complained about lack of domain expertise
This very succinctly describes the entire management class here in Sweden... The public sector is run by incompetent people who have to buy consultants to do anything and the private sector is led by the same kind of people to the point where actually competent people avoid going into management. I wonder how long we can keep this up.
No, this is just the definition of state corruption. They could have competent people, if they wanted to.
Procurement ("lagen om offentlig upphandling"), one of the big wins for the right, is also fundamentally broken in that a lot of the public servants involved are fresh graduates that soon gets poached by private corporations and the organisational response is to sign long term contracts with huge corporations that supply many different things and are also allowed to bring in subcontractors for the things they don't. This effectively destroys any possibility of commercial competition.
It's purposefully designed this way by conservatives.
That's the problem, isn't it ? The holy capitalist cow stands no competition.
Historically regimes like this tend to incite a lot of violence, either through criminal organisations as people seek fame and fortune outside the paths controlled and largely captured by the elites, or through militant revolution that might turn into civil war. I consider it highly irresponsible by our large unions and mainstream labour parties to having given way to this situation, they should have 'learned from history' as the tankies of old put it.
Research departments at large corporations with the right contacts can get campaigns designed for them, more or less, which I disagree with but it's not like it fits the picture you give.
The EU also does relatively much of "startup" funding through public credit, which is nice, because bad business ideas are killed fast if they can't beg their way into years and years of burning someone else's money, which we due to the private investment sector also had some of until the 2022 invasion of Ukraine and the rate hike.
Not sure what you mean... It fits perfectly with the picture I’m trying to convey.
By “these” do you mean anything European, or something specific to this structure?
If you're always going to lean into risk aversion and safety nets, you will lose to the player who is willing to make more risks. This involves the losers losing bigger, but the winners winning bigger.
That's what the US is compared to Europe. The winners are better off, but the losers are worse off.
Everything is a trade off. But it's highly unlikely you can have best of both worlds in the long run.
In October 2019, the A320 family became the highest-selling airliner family with 15,193 orders, surpassing the Boeing 737's total of 15,136.
In 2023 the number of Airbus aircraft in service surpassed Boeing for the first time.
In any case, Spotify, SAP, Booking definitely qualify as competitive.
Unfortunately for us, Europeans, that's what happens most of the time. SAP and Spotify are the ones that got away.
Europe ranks really poorly for tech: https://companiesmarketcap.com/tech/largest-tech-companies-b...
So, Spotify and raises eyebrows … SAP. Innovative.
BTW, Boeing is in the USA's top 10 exporters, it's not a minor thing.
But yeah the USA has a definite edge in software, if that's what you mean by "tech".
I'll give you some examples that usually stun the average Italian hence they usually stun most other people as well. You think Italy and probably think fashion but in fact the Top 10 Italian exports are (first semi-random results):
1) Machinery including computers: US$116 billion (17.2% of total exports)
2) Pharmaceuticals: $55.5 billion (8.2%)
3) Vehicles: $47 billion (7%)
4) Electrical machinery, equipment: $45.8 billion (6.8%)
5) Gems, precious metals: $25.7 billion (3.8%)
6) Plastics, plastic articles: $24.3 billion (3.6%)
7) Articles of iron or steel: $21.4 billion (3.2%)
8) Mineral fuels including oil: $19.4 billion (2.9%)
9) Optical, technical, medical apparatus: $17.4 billion (2.6%)
10) Clothing, accessories (not knit or crochet): $16.4 billion (2.4%)
"Infocom" has always been clearer to me, not sure why its usage waned so much ?
And Ford makes good cars, when they choose to.
That said, multiple American car companies (Dodge, Jeep, Chrystler) going under and ending up owned by an EU conglomorate sure doesn't feel like a stirling defense of GP's claim, I.E., "What the EU builds is not competitive with what America builds"
[0] https://en.m.wikipedia.org/wiki/Volkswagen_emissions_scandal
Oof.
The right way to do this would have been to match private financing so the EIB is providing capital but not gatekeeping. (That or commit to giving the first N companies to reach some milestone a bunch of cheap capital.)
One person's gatekeeping is another person's stewardship and due diligence
One person’s stewardship and due diligence is another’s person’s definition of fraud wealth transfer and crime.
Yes, that why you then buy the government and fire everybody who's investigating your many crimes. Much easier that way.
How long does it take to get a Series A round, and how many bureaucratic hoops do petitioners have to jump through?
You could also insist on the manager raising a certain minimum amount of matching private sector money to "keep them honest".
Israel did this with Yozma back in the 2000s, China recently with Guidance Funds, and the US with he IRA and CHIPS Acts, so it is a model that does work.
That said, the EIB press release is very vague [0], and it appears to be a proposal right now, and still needs to be approved by EIB's Board of Governors.
Realistically, we wouldn't get a true picture of this until mid-late 2025 at the earliest (notorious European summer season is about to kick in), so there's no point speculating about this until the final version that is passed by the Board of Governers
[0] - https://www.eib.org/en/press/news/president-calvino-tech-fir...
If Europe wants to copy the powerhouse tech industry of the US, it's going to have to become more like the US.
People here talked about Israel: the Shekel is not a currency anybody except them use, but they churn out successful startups at an incredible pace. They use their tech talent very well and are not encumbered by a myriad of regulations.
NYC has this vibe of "getting stuff sone, no BS" kind of mindset. California has this relaxed vibe but at the same time the sky is the limit. I think it has something to do with how the sun shines there and the ocean. You feel like just working and things are going to be OK.
I am always more productive in NYC or LA. And I have no real explanation for that.
> The bank aims to process startup financing applications within six months
No good founder is waiting for 6 months. It makes absolutely no sense when VCs can make decisions in days, hours even.
The UK isn't a member of the EIB.
> No good founder is waiting for 6 months. It makes absolutely no sense when VCs can make decisions in days, hours even.
Speculation, but based on similar initiatives done in the EU in the past, it will target industrial and manufacturing vendors and suppliers (especially as this proposal is linked to KfW).
That said, no point discussing this until the final proposal actually gets presented and voted on by the Board of Governors. Most of what exists publicly is just vague press releases.
So long as the EU doesn't have their own equivalent of Index Ventures, I'm not sure an EIB style industrial policy program would have significant impact on the British startup scene.
I started an incubator specifically for US based entrepreneurs looking to make the leap from what is, right now, an incredibly unstable place to build, and assist in getting both private and public funding for you, and take care of all the admin and immigration paperwork.
Come to Brussels, Belgium. It’s the most international city in the world per capita, English friendly, welcoming to expats and there’s 0% capital gains tax. It’s also human sized, you don’t need a car to get around.
Shoot me an email if you’re interested. This program was birthed right here on HN in a Who’s hiring thread. I’ve talked to 50+ founders who have had enough of the current admin and want change.
These are the companies with the connections that are getting the money.
The article doesn't give a lot of details, but the ones it does aren't inspiring confidence. A six month decision process is wildly incompatible with startup needs. EIB might be better off being limited partners in existing European VCs.
The EU is getting ready to brain-drain the US.
It is not going to happen, this is just day-dreaming. Yes, I saw the news, but you can't compare a few tens of people wanting to leave the US for ideological reasons to millions of people that stay in the US because they can fare better and make more money or start new companies overnight because they have a great idea.
Let me know where you see the US military pulling back from its global footprint. How many hundreds of global bases has the US begun closing? They're expanding US military spending as usual, not shrinking. The US isn't shuttering its military bases in Europe or Asia.
The US is currently trying to expedite an end to the Ukraine v Russia war, so it can pivot all of its resources to the last target standing in the Middle East: Iran. That's anything but isolationist.
Also, the US pursuing Greenland and the Panama Canal, is the opposite of isolationist. It's expansionist-nationalistic. It's China-like behavior (Taiwan, Hong Kong, South China Sea, Tibet).
All of those things can be bought. One of Europe’s strategic disadvantages vis-à-vis America and China is low availability of big, risk-taking cheque writers. Fixing that today is worth more than a working group to write a paper about a holistic solution in ten years.
Thankfully the US is making talent flee, hopefully some of those will wash up in the old world.
https://www.cityam.com/talent-is-fleeing-trumps-america-and-...
https://www.nature.com/articles/d41586-025-00938-y
https://www.theguardian.com/commentisfree/2025/mar/24/french...
LOL? Is this some strange side quest started by Russian propaganda? I wish I could link it but there was a literal Russian propaganda ad showing Europeans freezing during the winter of 2022 due to no Russian gas imports... which obviously did not happen.
1. Do you realize that the Russian energy sector is screwed for good, after the start of the war? European gas imports from Russia are basically 0. And Europe has diversified, it's now importing from the US, from Qatar, from Algeria, from a lot of places. Germany built a bunch of LNG terminals in 6 months. Russian gas imports are never going back.
2. https://en.wikipedia.org/wiki/Renewable_energy_in_the_Europe...
The EU (and Europe in general) is investing like crazy in renewables. Heat pump sales are up 3 digit percentages since 5 years ago. EVs, ebikes, solar panels, wind farms, etc, etc, etc. In 20 years there will be hardly energy dependency on anyone external.
> I hope it wasn’t a temporary utopia built on the tail end of centuries of theft and violence all over the world.
You mean, just like the US theft and violence all over the world? :-)
Pot, kettle, something.
* * *
Edit: found the Russian propaganda video: https://www.reddit.com/r/facepalm/comments/zuj7lx/russian_st...
America, the famously self-reliant giant. This has to be satire.
The productivity numbers for the eu are dreadful so something needs to change.
Besides, it's screamingly obvious the US has literally chosen to pivot back to the Middle Ages, so even these captured productivity differences won't be an issue for much longer.
You did say literally so can you do a point by point comparison?
We have other people claiming the US is fascist and one of the aims of fascism was to take European culture and religion back to before the Middle Ages - they wanted to emulate the Roman Empire.
Public perception for many people is that the US is on its way to become a failed state.
A happy, healthy society does not need to change to meet capitalist productivity goals. Consumption is killing the world, led proudly by the US.
What needs to change are the metrics we use to judge a society, because if financial success leads to the United States, that's the cautionary tale for the rest of the world, not the example.
All you’ll get are sluggish companies designed to suck up the funds. I used to work for such a company. The business model seemed to be whatever would fund hours of researchers time, and travel money for those smart enough to write papers for whatever conference was in a country they hadn’t visited yet. Targeting EU funds was top priority and they could do it by creating some arbitrary “consortium” that generated enough credibility with adjudicators. I hated the waste and the lack of actual goals.
The Ukrainians have done some pretty incredible stuff with very basic tools and lots of ingenuity.
I have just stumbled over a project that was developed as part of that fund. Super minimal probably the funding and obviously only a start, but this has a 'dutch flair' of being practical, usable etc. As always: please send people to teach the germans about how to build things (2 extra cookies if you teach us how to *Railway*)
I do think the way to success for EU is to start with this little elements. Maybe EU cloud infra later relies on one little OS component that is still maintained by 3 people - not one ;).
If we invest our time in something else than cloning hyperscalers - maybe there is a silver lining in form of a technological jump on the horizon. What about a Eurocloud that is a distributed system and not a 'monolith by monopoly'. The Systems we replace are not cheap, so there is even money on the table. Building EU hyperscalers just would suck OS projects dry of their 'IP' and siff money to a account on the caimans or UAE somewhere. Not building them is the way.
Maybe not make this a 'bring US startup culture to europe' thing as well? It leads to monopolies and a lot of 'loosers'. Not a super efficient way to build what in fact is infrastructure.
This new 70B will come from bonds sold to EU member states. The states need to approve purchasing the bonds.
EIB earns about 3% profit. Private banks earn about twice that [2]. EIB is a non-profit organization.
EIB makes about 10% of its loans outside of the EU.
[0] https://www.eib.org/attachments/lucalli/20240237_070525_fina...
[1] https://en.wikipedia.org/wiki/European_Investment_Bank#Fundi...
[2] https://www.bankingsupervision.europa.eu/press/speeches/date...
And bureaucracy is not limited to government offices.
for a lot of startups
Because most of the time, the point of such government "investments" is to be another hidden wealth transfer from the taxpayers into the pockets of those with government connections (your Siemens, T-Systems, Capgemini, Thales, etc). That's a feature, not a bug.
Imagine Dell, Zuck, Jobs, Page and Brin back in the day, waiting for handouts form the US government to fund their companies, instead of VCs. None of their companies would exist today.
Governments are only good at funding infrastructure, education, healthcare and defense projects, you can't rely on them to build you the consumer focused private tech industry the US VC industry did. It's not something achieved through central planning, and the EU refuses to get that, so it keeps throwing money into the "maybe it'll work this time" bonfire.
I switched sanitation to a private septic system. I bought a share of private well to avoid public water systems. I built my own roads and live in a community where all the roads are private easements so no tax money (you can drive for miles and miles without ever hitting a public road). Medicine, I made friends with a private practitioner that was educated at a private university. There are basically no police here, so I learned todefend myself. I send my kid to private school. Out of your list, the only thing I benefit from tangentially is public roads but they are way worse value than our privately funded ones (I first built mine with nothing more than a hatchet and a shovel for $0 and then later learned how to operate a backhoe).
I'm well aware I still use some public services, even if indirectly, but when I compare the costs they are all much more efficient when I have switched to private infrastucture vs trusting politicians not to squander it. My local taxes are now down to next to nothing, and when I look at what exactly I am getting for the ~30% I pay out to the state and federal the only thing I seem to be getting on ok deal on is the US navy protecting trade routes, maybe contract law courts, and nukes for mutually assured destruction.
The US hands out money extremely generously through federal grants, DARPA and orders which have to be made to American companies through things like the Buy American Act. Silicon Valley itself was spurred by the DoD spendings.
You're ignoring my point or arguing in bad faith, since I already addressed this to the comment you're replying to.
The EU also spent a lot into defense and R&D, the difference is the US gov didn't spend money in the start-up consumer market, but they let private entrepreneurs commercialize some of the solutions that trickled down from the defense tech into the consumer sector to make money (CPUs, 3D graphics, radios, etc).
This is where the EU is deficient and you can't fill this entrepreneurial visionary void with government bureaucrats shoveling taxpayer money around to their friends.
What did DARPA have to do with Apple's success in the music and phones business? What DARPA money went into the iPod or the iPhone? They were made with commercial off the shelf chips that the likes of Nokia and Ericsson also had access to, not some super secret US DoD tech.
Just like many SV companies, Philipps, Ericsson and Nokia also were government founded from selling radars and radios to the military initially before the tech trickled to consumer. Yet Apple is now a multi trillion company(that was nearly bankrupt in the 90s) and the EU phone companies have withered away. Why is that? Is it because of "DARPA and the government"?
The U.S. spends obscene amounts of money on crap from Microsoft and Amazon and Oracle and Google.
And Amazon got off the ground from Bezos selling books online from his bedroom then pivoting to webs services, not from receiving government handouts to start a e-commerce business. These are the kind of scale-up success stories the EU lacks and can't be done thorough direct government intervention.
> Governments are only good at funding infrastructure, education, healthcare and defense projects
My point: well, the US government literally funded what became the VC landscape you seem to imply can’t be spurred by a government and still routinely fund very generously companies which then become industry behemoths.
Every new promising fields in the US is flushed with government handouts through DARPA grants, federal research grants or supplying contracts. This money then irrigates the whole fields as companies do business with each other.
It goes all the way to the VCs. Take a look at the list of the US biggest investors and see how many of them got rich through companies having the state as their biggest customer.
Heck, Siemens and Thales which you seem to despise are basically acting like dozens of American companies which are entirely funded by the DoD but on a smaller scale.
I've already addressed this point here in the comment you're replying to, but it seems people like to argue in abd faith, or jump to comment without fully reading everything. Let me copy it again here: "The US government didn't give Jobs taxpayer money to design the iPod, he had to scrape it himself wherever he could and convince people that licensing music will be the future, and it paid off big time. That's the beauty of the free market that decides which products live or die, not the government."
>Every new promising fields in the US is flushed with government handouts through DARPA grants
What did DARPA have to do with Apple's success in the music and phones business? What DARPA money went into the iPod or the iPhone? They were made with commercial off the shelf chips that the likes of Nokia and Ericsson also had access to, not some super secret US DoD tech.
Just like many SV companies, Philipps, Ericsson and Nokia also were government founded from selling radars and radios to the military initially before the tech trickled to consumer. Yet Apple is now a multi trillion company(that was nearly bankrupt in the 90s) and the EU phone companies have withered away. Why is that? Is it because of "DARPA and the government"? Come one mate.
I am lost on why you fixate on Apple or why you talk about some secret DoD tech. The DoD buys a ton of things which are not secret.
And yes, the amount of money the US spends on its companies is a significant driver in the US economy success in a way which is not dissimilar to China through with more steps involved or Europe for that matters which also does it but on lesser scale.
There is no "come on" here.
This new comment adds no extra proof or value to your original claims.
Socialists milk the funds for their NGO friends, and likewise the center-right politicians divert the funds to their corporate backers. Two sides of the same coin.
Dealing with German bureaucracy is the hardest thing I have done in my life, perhaps second only to bootstrapping my business. Bureaucracy isn't a side effect of poor planning; it's tool to control individual liberties and capital, without going full communist.
For the first time, I am considering selling my business. I want Europe to succeed, but I see no way how. Any little faith I have in EU actually resides in a handful of underdogs like Estonia and Poland.
Most of that €70B is going in the pockets of bureaucrats and consultants, assuming any startup sees a dime within 3 years.
I'm a little cynical about this. Apparently EU has lots of wealthy people and they get to keep their wealth for generations. It's just that we don't necessarily even know who they are or how they keep generating wealth. Per Taleb in his book Skin in the Game:
"Consider that about ten percent of Americans will spend at least a year in the top one percent and more than half of all Americans will spent a year in the top ten percent[1]. This is visibly not the same for the more static –but nominally more equal –Europe. For instance, only ten percent of the wealthiest five hundred American people or dynasties were so thirty years ago; more than sixty percent of those on the French list were heirs and a third of the richest Europeans were the richest centuries ago. In Florence, it was just revealed that things are really even worse: the same handful of families have kept the wealth for five centuries.[iii]"
[1] 39% of Americans will spend a year in the top 5 % of the income distribution, 56 % will find themselves in the top 10%, and 73% percent will spend a year in the top 20 %.
[2] The type of distributions –called fat tails –associated with it made the analyses more delicate, far more delicate and it had become my mathematical specialty. In Mediocristan changes over time are the result of the collective contributions of the center, the middle. In Extremistan these changes come from the tails. Sorry, if you don’t like it but that is purely mathematical.
[ii] HBR article by Joan williams https://hbr.org/2016/11/what-so-many-people-dont-get-about-t...
[iii] Ref http://www.nytimes.com/2014/04/20/opinion/sunday/from-rags-t...
[iv] http://krugman.blogs.nytimes.com/2014/04/25/piketty-and-pare...
This seems like A LOT of cash filtering into the system whichever way you cut it.
It's great.
My experience is that we had to hire consultants from big corp consultancy firms just to guide us through the documentation needed and the application process.
Then it would be interesting to see this % comparison with US and China. Could be strongly correlated with ROI.
The person in charge is not fit to run a small coffee shop much less a 70B fund.
I think this is a terrible idea, because it does not address why there is no European startup culture. Europe has tech talent and Europe has money, yet it has no start-up culture. There are many reasons for this. To me the most important ones are:
- Many EU member states have very start-up hostile labor laws. In Germany many tactics/offerings US startups use to hire talent are illegal.
- The wage difference between hard work at a startup, less hard work at a large corporation and very low stress work in a government office is minimal. Working for a startup is almost never financially rewarding.
- The mainstream social democrat conception of work, which much of the population shares, is totally at odds with American start-up culture.
Money does not solve any of these problems, because it does not answer the single most important question. Who is going to do anything with this, that is actually worthwhile. I have seen dozens of these EU funded projects and as a tech enthusiast I think many of them are exciting and cool and fun and interesting. The number of actual useful products I have seen is at zero.
EDIT: Maybe I'm too cynical, but as far as I can see the last time serious improvements to the material conditions of the working class were made was when the soviets were still around, and the threat of a worker's revolution still seemed somewhat realistic. I think the politically dominant class has become quite adept at suppressing that kind of thing, and UBI does not seem to be part of their preferred playbook.
Solving faraway hypotheticals in lieu of actual problems is half of the EU’s problem.
57 million UK adults getting £1000 a month (It'll leave you dying on the street in 1/3rd of the country)
Over the course of a year = £684 billion. Current total government spend is 1,278 billion
If you abolished all forms of social care including welfare, pensions, child care, disability (the lot). And education. And the NHS. you could do it providing you also dropped defence by 2/3rds.
UBI is madness.
You phase it in. You start with something a little more than UC of, say £400/month for people not receiving pensions. You increase as it can be afforded. it gives people a great deal of security.
So far fewer people (37m of working age) getting less than half the amount you came up with costs. That is £278bn offset by reducing welfare spending. You would need to continue housing benefit and some others if it was that low so you could not dismantile the entire system.
> It'll leave you dying on the street in 1/3rd of the country
I doubt that - it is not a decent income, but most people would earn on top of it. That is the whole point. It would give people a greater incentive to work than the current system which reduces welfare if they earn. A lot of people will not work because they are no better off if they do.
OBR projects welfare spending to be £338bn by 29/30 anyway.
You are leaving a lot of things out. For one thing if it was taxable income (as pensions and many benefits are) tax revenues would increase too as most people would pay on it.
It would provide a huge economic stimulus which would further increase tax revenues. People on low incomes spend more of their income. Some of that would be on things with consumption taxes.
It would give people a great deal of financial security.
You cannot calculate the effects of a huge change like this on the assumption that nothing else changes.
[0] https://www.ons.gov.uk/peoplepopulationandcommunity/personal...
The fact that a UBI which set at a rate low enough to make some existing benefit dependents would also be a generous subsidy to homeowning couples who might be able to use it to to retire a decade or two early isn't one of its strong points
If you are suggesting people would choose not to work if we had UBI, the evidence from trials so far is that it does not happen.
AI alone is not enough to kill off all jobs. UBI isn’t coming.
We're the only developed western country on planet that doesn't have healthcare as a human right and you think our governments will pass a universal basic income?
Thats alot of money to spend.
The opportunity of wasting the hard earned money of the citizens she means.
Have they considered doing useful stuff like removing regulations, lowering taxes, fixing the immigration mess, etc? You know, what actually made America an innovation hub.
This will end the same way it always does every time the EU gives away money to economic sectors they are jealous that the US have and they don’t: a select few will fill their pockets with nothing to show for it.
From the East India Companies to Airbus, strong European companies have been made around strong European states.
https://royalsocietypublishing.org/doi/10.1098/rsnr.2018.001...
Btw: the East India trading company is still used in economics schools as an example of state interference in trade and what can go terribly wrong.
The East India company era had WAY less regulation all around, way lower taxes, less types of taxes, a very attractive simple investment climate (the literal founding of the concept "stock market", in its simplest and most primitive form) and close to 0 (illegal) immigration. They also had no euro, no socialist EU and no self-imposed limitations on energy conversion (there was no electricity, but wind was huge and allowed for mass production of stuff).
> They also had no euro, no socialist EU and no self-imposed limitations on energy conversion (there was no electricity, but wind was huge and allowed for mass production of stuff).
These are the diseases of weak states, incapable of creating state ownership enterprises that could dominate the world.
An innovation hub or a capitalistic, fascistic hellscape about to collapse into itself?
> This will end the same way it always does every time the EU gives away money to economic sectors they are jealous that the US have and they don’t:
I think you are so far down the propaganda rabbit hole that you can't see the reality. Europeans do not want the US oligarchy. This move is to try to distance the bloc from the failed experiment that is the States.
The tech sector in the "fascist hellscape" is paying its workers 3-4x what Europe is, and Europe is doubling down on the policies that got it there.
>I think you are so far down the propaganda rabbit hole that you can't see the reality
You built your whole argument on a future collapse you've imagined for across the pond, rather than engaging with the topic at hand. You are the one who refuses to see.
The absurd income inequality in the US tech sector is not the boast you think it is.
> You built your whole argument on a future collapse you've imagined for across the pond, rather than engaging with the topic at hand.
The collapse of US society has already occurred.