[HN Gopher] European Investment Bank to inject EUR70B in Europea...
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European Investment Bank to inject EUR70B in European tech
Author : saubeidl
Score : 249 points
Date : 2025-05-19 16:05 UTC (6 hours ago)
(HTM) web link (ioplus.nl)
(TXT) w3m dump (ioplus.nl)
| jaoane wrote:
| > Drawing on the current geopolitical landscape, Calvino sees the
| uncertainty generated by US President Donald Trump's economic
| policies as an opportunity for Europe.
|
| 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.
| sillystu04 wrote:
| That's never been the European way of doing things. You can't
| beat America at being America.
|
| From the East India Companies to Airbus, strong European
| companies have been made around strong European states.
| bboygravity wrote:
| Bad example.
|
| 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).
| sillystu04 wrote:
| When companies were operated by royal charter and owned by
| aristocrats there wasn't much meaningful distinction
| between dividends and taxation.
|
| > 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.
| spwa4 wrote:
| You should ask Isaac Newton (yep, that one) about these
| strong European companies:
|
| 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.
| closewith wrote:
| > You know, what actually made America an innovation hub.
|
| 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.
| missinglugnut wrote:
| In what reality is giving politicians a fund to pick winners
| and losers in the economy going to prevent fascism?
|
| 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.
| closewith wrote:
| > 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
|
| 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.
| alecco wrote:
| Great idea and I think they should 10x it, but... the person in
| charge according to the article is EIB President Nadia Calvino.
| She is a Spanish career politician and a socialist lawyer with
| background in media and broadcasting. They rarely put in charge
| experienced people or at least engineers. It's so sad to see the
| EU crumble due to a cast of career bureaucrats squeezing it to
| its last drop. There are so many great universities and
| researchers to build things.
| FirmwareBurner wrote:
| _> They rarely put in charge experienced people or at least
| engineers._
|
| 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.
| StopDisinfo910 wrote:
| > Imagine Steve Jobs, Larry Page and Sergey Brinn back in the
| day, waiting for handouts form the US government instead of
| VCs.
|
| 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.
| FirmwareBurner wrote:
| _> 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._
|
| 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"?
| JumpCrisscross wrote:
| > _US gov didn 't spend money in the consumer market_
|
| The U.S. spends obscene amounts of money on crap from
| Microsoft and Amazon and Oracle and Google.
| FirmwareBurner wrote:
| So does EU on Siemens, Thales, T-Systems, Capgemini, SAP,
| etc plus hundreds of other politically connected body
| shops peppered around Brussels. What's your point here,
| where are you going with this? That all governments have
| their preferred go-to monopolies for services? What's
| that got to do with the start-ups I was talking about?
|
| 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.
| breppp wrote:
| Government buying from a monopoly is a bit different than
| government financing an early stage startup as OP
| described
| StopDisinfo910 wrote:
| Your point:
|
| > 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.
| FirmwareBurner wrote:
| _> well, the US government literally funded what became
| the VC landscape_
|
| 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.
| StopDisinfo910 wrote:
| You do realise the fact that some companies can innovate
| without government money doesn't in any way invalidates
| the claim that the US government does indeed give
| handouts.
|
| 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.
| mistrial9 wrote:
| the USA venture system has built the most addictive and
| invasive tech system yet -- ads + phones. Hot on their heels
| is an invasive and controlling behometh called China. None of
| these are clear winners, in fact it remains to be seen how
| long this is stable. Its not intellectually honest to claim
| victory for the USA based on VC practices IMO
| AStonesThrow wrote:
| Yeah! Apart from sanitation, medicine, education, wine,
| public order, irrigation, roads, the fresh-water system and
| public health, what have the Romans ever done for us?
| ty6853 wrote:
| So I used to buy all those publicly, slowly I started
| divesting from any public utilities to the extent I could.
| Everytime I switched from public to private, I didn't see
| all the bad stuff happening people seem to think would
| happen.
|
| 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.
| StrauXX wrote:
| You are using the word "socialist" as if it implied "bad". I
| find that to be a very unreflected point wothout further
| elaboration. Most of Europe is built on socialist-democracy.
| Wether it works "better" or "worse" than the USA way can be
| debated. But it is definetly not "bad" per se.
| alecco wrote:
| You are twisting my words. I informed correctly she has zero
| experience or credentials to manage this project. She was
| picked because she is part of the Spanish Socialist party
| (currently ruling) instead of being picked for being the
| right person for the job. I would've mentioned the equivalent
| if it were a politician from Macron's center-right party, for
| example.
|
| 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.
| miltonlost wrote:
| Oh no. Socialism!!!!
| FaridIO wrote:
| The folks who allowed the continent to fall behind through over-
| regulation would like you to know they'll now do a good job at
| being the capital allocators.
| closewith wrote:
| The continent is well ahead in health, quality of life, justice
| and society, partly due to regulation.
| whatnow37373 wrote:
| Those are all irrelevant. The market will magically fix
| everything, don't you know that?
| j7ake wrote:
| It's funny because there are people in USA who actually
| believe health and quality of life are irrelevant because
| they're not measured by GDP.
| kasey_junk wrote:
| I think the concern is the fiscal ability for eu nations to
| continue to pay for the things that help it stay high on
| those metrics, especially without innovation.
|
| The productivity numbers for the eu are dreadful so something
| needs to change.
| TheOtherHobbes wrote:
| The distribution of productivity gains in the US is beyond
| 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.
| graemep wrote:
| How is the US anything like the Middle Ages?
|
| 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.
| closewith wrote:
| > The productivity numbers for the eu are dreadful so
| something needs to change.
|
| 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.
| FaridIO wrote:
| I hope all this stays true without growth. I hope it wasn't a
| temporary utopia built on the tail end of centuries of theft
| and violence all over the world, and a relative peace
| subsidized by the US Navy. American problems generally last 4
| years, and even our bigger problems sit on top of relative
| self-reliance. As far as I can tell you can't even heat your
| homes in winter without Russian or American gas.
| closewith wrote:
| > American problems generally last 4 years, and even our
| bigger problems sit on top of relative self-reliance.
|
| America, the famously self-reliant giant. This has to be
| satire.
| oblio wrote:
| > As far as I can tell you can't even heat your homes in
| winter without Russian or American gas.
|
| 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_Eu
| rope...
|
| 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.reddi
| t.com/r/facepalm/comments/zuj7lx/russian_st...
| qoez wrote:
| Imagine if AI does become so powerful UBI is a necessity. How
| would europe be able to pay for UBI without money coming in and
| taxes being paid to fund it? Things like this seem critical for
| the future of the EU and yet I'm super sceptical this will lead
| to openai etc level quality.
| JumpCrisscross wrote:
| > _Things like this seem critical for the future of the EU_
|
| Solving faraway hypotheticals in lieu of actual problems is
| half of the EU's problem.
| wesselbindt wrote:
| At what point would AI necessitate UBI? I'm assuming your idea
| here is, roughly speaking, that at some point, AI will displace
| a large section of the work force, rendering them homeless and
| unable to feed themselves, and that to prevent this, UBI would
| become necessary. But don't we already have homeless folks?
| Haven't we already been through technological revolutions
| putting people out on the streets? If this historical precedent
| is anything to go by, the politically dominant class is
| perfectly content with people going homeless on account of not
| being able to find a job. Seems to me that the classical
| solutions of pumping drugs into the streets, immobilizing the
| downtrodden, and straight up slavery through the prison system,
| are much more likely to happen than UBI
| dudefeliciano wrote:
| if enough workers are displaced due to this, and they do not
| receive some form of income, the politically dominant class
| will be in danger
| qoez wrote:
| Or they make money the way B2B companies do; which seems
| like companies just shifting money around on the upper
| layers without it ever really reaching the hands of lower
| classes.
| whatnow37373 wrote:
| Let's all focus on not waging bloody goddamn war against each
| other first before worrying about AI anything.
| swarnie wrote:
| I've never found someone with creative enough accounting to
| make UBI work. Just purely on numbers:
|
| 57 million UK adults getting PS1000 a month (It'll leave you
| dying on the street in 1/3rd of the country)
|
| Over the course of a year = PS684 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.
| freeone3000 wrote:
| This also assumes that government tax revenue doesn't drop,
| and with most of the population unemployed, that will likely
| not be the case.
| graemep wrote:
| If AI was putting people out of work at that rate the
| remaining businesses would be hugely profitable so there
| would be a huge tax base. The economic output would be the
| same or higher.
|
| 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.
| zipy124 wrote:
| Corporation tax is much lower and easier to dodge than
| income tax. Corporation taxes were only 11% of UK
| government income compared to 28% for personal income
| tax, 18% for national insurance and 17% for VAT (sales
| tax). If a company did develop AGI, it would sell
| services in the Uk and pay licenses to the technology in
| a subsidiary in a low-tax durisdiction like we have with
| ireland for the past couple of decades.
| graemep wrote:
| > 57 million UK adults getting PS1000 a month
|
| You phase it in. You start with something a little more than
| UC of, say PS400/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 PS278bn
| 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 PS338bn 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.
| dmurray wrote:
| PS1000 a month for a single person certainly sounds like
| poverty, but PS2000 a month for a couple sounds more
| manageable. If they each find a side gig that pays just
| another PS100 a week, they're suddenly into the top half of
| households [0] - even better than that outside London.
|
| [0] https://www.ons.gov.uk/peoplepopulationandcommunity/perso
| nal...
| notahacker wrote:
| That's in line with the OP's point that it's not really
| affordable compared with the current system, for all that
| system's flaws
|
| 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
| deadbabe wrote:
| Even if AI can became so powerful it eliminated all office work
| there would still be jobs for people to do involving moving or
| manipulating physical matter, I wouldn't worry about it. We
| need cooks, cleaners, mechanics, nurses, movers etc.
|
| AI alone is not enough to kill off all jobs. UBI isn't coming.
| Jackpillar wrote:
| You're asking how _Europe_ would pay for a large scale social
| program? I hope you don 't live in the US my friend because if
| AI gets to a point where UBI is ever needed you better get
| comfortable sleeping outside.
| daedrdev wrote:
| Europe's finances are in dire straights under the heavy
| pensions and existing government spending. The US also has
| high debt, but has much lower taxes than the EU so can
| theoretically raise revenue if it really needs to, while
| Europe has little room for more taxation
| jarym wrote:
| investment is one piece of the puzzle - but you need talent,
| reasonable cost of living, and a fiscal climate that rewards
| success instead of sucking any sliver of it with onerous taxes.
| All those factors of course vary throughout the EU but it would
| be nice if they took a more holistic approach to supporting tech
| ventures.
| JumpCrisscross wrote:
| > _All those factors of course vary throughout the EU but it
| would be nice if they took a more holistic approach to
| supporting tech ventures_
|
| All of those things can be bought. One of Europe's strategic
| disadvantages vis-a-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.
| pornel wrote:
| The US is adopting isolationist policies based on a nationalist
| ideology. The government is run by anti-intellectuals. The US
| economic policy is based on xitter rants, and flip-flops every
| week. The fickle vindictive ruler is personally attacking
| businesses that don't make him look good. It's clear that in
| the US the path to success is now _loyalty_. The president runs
| a memecoin.
|
| The EU is getting ready to brain-drain the US.
| underdown wrote:
| I make 4x in the US what I'd make in Germany.
| ExoticPearTree wrote:
| > 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.
| adventured wrote:
| The US is not adopting isolationist policies. It's adopting
| more nationalistic policies, which is no different than how
| China has been running its economy (and politics in general)
| for decades. And specifically the four year Trump
| Administration is pursuing heavily nationalistic policies.
| There's no evidence the Democrats will keep much of Trump's
| policy direction, as certainly the Biden Admin and Trump
| Admin could hardly be more different.
|
| 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).
| exe34 wrote:
| > but you need talent
|
| Thankfully the US is making talent flee, hopefully some of
| those will wash up in the old world.
| nxm wrote:
| Can you back this up in anything but anecdotes?
| exe34 wrote:
| Sure thing, thanks for asking!
|
| 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/frenc
| h...
| WrongAssumption wrote:
| Sorry, are you under the impression the contents of these
| articles supports your assertion?
| pknomad wrote:
| Good for EU for trying to improve tech market, but I recall
| seeing another thread here at HN why it can't be solved by simply
| throwing money at it.
| StrauXX wrote:
| It's really tiring to see the same handful of arguments on HN
| every time anything related to Europe or the EU is posted on
| here. Yes, some things the USA is doing better than Europe, but
| far from everything and depending on your political leanings (or
| rather social position) even most.
| hnthrow90348765 wrote:
| The USA doing things better is quickly going to be false
| djohnston wrote:
| Compared to whom?? The EU??? Lmk when they're building
| anything competitive.
| xethos wrote:
| Commuter rail, public transit, a social safety net, and I
| personally would take anything from Volkswagon group over
| the average Dodge vehicle
| nickserv wrote:
| Dodge is owned by Stellantis, a EU company...
|
| And Ford makes good cars, when they choose to.
| xethos wrote:
| My mistake, I'd forgotten Dodge was owned by Stellantis.
|
| 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"
| WrongAssumption wrote:
| Volkswagen of diesel-gate fame? That one?
| xethos wrote:
| I mean, Jeep and Dodge (when owned under their American
| umbrella corp., FCA) were later found to be using similar
| defeat devices (see "Other manufacturers [0]). Though if
| you want to smear them, you may as well go all in and
| point out they were the original Nazi car brand - not
| even Tesla has that kind of credibility
|
| [0] https://en.m.wikipedia.org/wiki/Volkswagen_emissions_
| scandal
| ABS wrote:
| I wonder why US businesses and people import so much stuff
| from the EU if there isn't anything competitive coming out
| of it
| adventured wrote:
| Nobody here is seriously suggesting the EU doesn't
| compete economically. The conversation is focused on tech
| companies, which is in the subject of the thread. Broadly
| the EU competes very well with the US, China and globally
| more generally. In most tech areas the EU continues to
| lag far behind the US and China.
| ABS wrote:
| except you seem to think (like many others commenters in
| this thread) that "tech" means solely "silicon valley-
| type startups", which it does not.
|
| 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%)
|
| I see a lot of "tech" in this list, I had this very same
| conversation with a German Private Equity last week but
| they are well aware and invest in "tech", just not the
| "tech" the average HN visitor think about
| 9283409232 wrote:
| Spotify is a Swedish company and is the defacto music
| streaming company, Supercell is one of the largest mobile
| game companies and is Finnish, Mistral AI is French. There
| are a lot of European companies that have solid footprints
| in America.
| albumen wrote:
| In 2019, Airbus displaced Boeing as the largest aerospace
| company by revenue.
|
| 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.
| nxm wrote:
| One example? How about tech?
| Fargren wrote:
| How is Airbus not tech?
|
| In any case, Spotify, SAP, Booking definitely qualify as
| competitive.
| oblio wrote:
| Booking is owned by a US company:
| https://en.wikipedia.org/wiki/Booking_Holdings
|
| 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...
| nickserv wrote:
| If building airplanes isn't technology, I don't know what
| is.
|
| 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".
| agumonkey wrote:
| erlang ? skype (rip) ? ocaml ?
| zpeti wrote:
| In this case, it's not hard to make the argument that you can't
| have one without the other.
|
| 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.
| landl0rd wrote:
| Calvino is the wrong choice to lead this. Why not tap a few
| people from Mistral if they care about AI? Spotify if they care
| about more generic tech?
|
| 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.
| JumpCrisscross wrote:
| > _Calvino is the wrong choice to lead this_
|
| Will Calvino be picking and choosing the grantees?
| landl0rd wrote:
| This isn't the point. More knowledgeable people at lower
| levels can help. But when leadership lacks domain expertise
| it's very hard to know what to do or not do, what will help
| and won't. She could be smart and lean heavily on industry
| experts but that _still_ makes her the wrong choice to lead
| it when one of them could have done so better.
|
| 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.
| amarcheschi wrote:
| Elon Musk lacks domain expertise given how he asked to
| rewrite Twitter stack to the devs after it was bought
|
| If you're talking about the domain of startups and
| companies themselves though, I'll give you that
| robertlagrant wrote:
| > Elon Musk lacks domain enterprise
|
| What does this mean? I can't parse it.
| amarcheschi wrote:
| Sorry, I meant expertise not enterprise
| robertlagrant wrote:
| Ah, okay. I still don't quite know what it means. He
| clearly has something, as he's launched/run various
| successful and wildly innovative companies.
|
| 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.
| amarcheschi wrote:
| Knowledge of the domain he launches company of. I'll give
| him that he's great at launching and probably managing
| companies, he's still not an expert in the technical side
| of the field his companies operate in
|
| I answered because the guy above me complained about lack
| of domain expertise
| meekaaku wrote:
| His domain expertise is running a high performance
| engineering team. I think he has a good record of that.
| landl0rd wrote:
| I don't remember mentioning Musk once in my comments.
| He'd also be a poor choice. They should stick with a
| european who understands the challenges of start-up high
| tech in europe.
|
| 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.
| 9283409232 wrote:
| You don't see why it might not be a good idea to give leaders
| in for-profit companies like Mistral or Spotify the keys to
| billions of dollars in funding?
| logicchains wrote:
| It's a much better idea to give it to people who actually
| have experience turning financial investment into a valuable
| technological product than giving it to bureaucrats with no
| such experience.
| Fraterkes wrote:
| I hear these salary comparisons a lot, but when I was studying
| at the most popular Dutch technical university none of the
| future SWEs I talked to where even considering moving to the US
| (this was back when there was an excess of swe jobs
| everywhere). There's not much of a braindrain of engineers as
| far as I can tell, European engineers are not vastly less
| impressive than their American counterparts, and the people
| running succesfull startups in the US do not posess any
| particular brilliance.
|
| All of which is to say, I don't think lack of Software
| Engineering talent is the problem.
| FirmwareBurner wrote:
| _> There's not much of a braindrain of engineers as far as I
| can tell_
|
| 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.
| ivan_gammel wrote:
| Big successful companies in USA aren't big just because of
| better access to capital. It's easier to create a monopoly
| there without major consequences for the business. Europe
| has no interest in having such businesses, as was
| demonstrated by DMA.
| Fraterkes wrote:
| First of all, I'm not in a bubble, those don't exist.
| 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?
| stuartjohnson12 wrote:
| I'm in the bubble where probably the most engineer brain
| drain of any bubble (VC early stage). My observation is
| that the brain drain is... moderate. Huge, huge brain drain
| of startup founders. But of engineers? A tendency towards
| risk aversion and a preference for stability nixes that in
| my experience. I know some specialists who hopped over to
| the Bay in pursuit of the niche and lucrative jobs that
| their specialism rewards. But for most run-of-the-mill
| software engineers, I really haven't seen anyone fleeing to
| the bay for more money.
| JumpCrisscross wrote:
| "The bank aims to process startup financing applications within
| six months, significantly improving from the current 18-month
| timespan."
|
| 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.)
| RobRivera wrote:
| Matching private funding brings the decision making lever to
| private funders, creating a mechanism to extract tax dollars
| with minimal government discretion and would be a process ripe
| for abuse by those with significant capital.
|
| One person's gatekeeping is another person's stewardship and
| due diligence
| newsclues wrote:
| Governments would never deploy capital in ways that are
| stupid, corrupt or gatekeeping.
|
| One person's stewardship and due diligence is another's
| person's definition of fraud wealth transfer and crime.
| TheOtherHobbes wrote:
| Nor would VCs, obvs.
|
| How long does it take to get a Series A round, and how many
| bureaucratic hoops do petitioners have to jump through?
| exe34 wrote:
| > 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.
| miltonlost wrote:
| Yay subjectivism means no one is right!!!! Definitions are
| meaningless!!!
| christkv wrote:
| In comparison to just giving money today? Just look at the
| number of failed green projects in the EU where somehow the
| executives got rich and nothing got built or if built failed
| to deliver. At least with matching the private sector has to
| put a eur down for each it receives and the fund would own
| participations in ventures.
| tomatocracy wrote:
| Another model would be for the EIB to commit money to an
| investment fund and then run a tender process to select a
| private sector firm to manage the fund. At the individual
| investment level, give that manager the usual discretion to
| invest and manage that VC funds have and pay them a market
| rate with an appropriate fee structure to do it.
|
| You could also insist on the manager raising a certain
| minimum amount of matching private sector money to "keep them
| honest".
| alephnerd wrote:
| > The right way to do this would have been to match private
| financing so the EIB is providing capital but not gatekeeping
|
| 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...
| evanjrowley wrote:
| When it comes to European tech funding, I'm a big fan of NL Net's
| Next Generation Internet (NGI) grants[0]. These grants the only
| kind of investment I care about and the only kind I want to see.
| My opinion towards this is influenced by the enshittification[1]
| that has unfortunately been embraced by large tech companies and
| financial powers in the United States. Overall I'm not confident
| this is actually good news, but the fact that the financing is
| also available to researchers seems like a possible silver
| lining.
|
| [0] https://nlnet.nl/commonsfund/
|
| [1] https://en.wikipedia.org/wiki/Enshittification
| therebase wrote:
| I can totally second that.
|
| 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.
| huqedato wrote:
| From a person who has dealt with the management of European
| research projects: these funds will go through the EU
| bureaucratic maze, don't even think they will be available
| directly to startups. There will probably be programs and sub-
| programs, projects and other craps like that to more difficult
| for people to access the money. It's how the EU works. That's why
| startups flee to US if they want serious financing.
|
| So leave me be very skeptical about this news.
| bgnn wrote:
| Most of the time the money goes to keep big inefficient
| European companies European CHIPS act mainly divided the money
| into smaller sub programs, and gave the money to big companies
| like ST, Infineon, NXP etc.
|
| 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!?
| ty6853 wrote:
| European voter moral imperatives contradict the structure of
| the countries and special economic zones that foster the
| greater proportion of startups.
| edf13 wrote:
| And many of these sub-sub-programs cost more to run than they
| distribute.
| nand_gate wrote:
| Feature, not a bug.
| 77pt77 wrote:
| Just like NGOs and charity in general.
| fock wrote:
| oh, they are available to startups. Startups having the sole
| purpose of skimming funds by being the technology partner to
| some academic.
|
| 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 800kEUR 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 4MEUR to "promote innovation".
| robocat wrote:
| > Startups having the sole purpose of skimming funds by being
| the technology partner to some academic.
|
| 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).
| jajko wrote:
| Yes we all know this, this is nothing new. But its the movement
| in right direction, especially now, rather than literal burning
| money on globally-abandoned green deal. Perfect being enemy of
| good and all of that
| dgb23 wrote:
| If this is the case, then I sincerely hope this will be
| attacked.
|
| 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.
| jillesvangurp wrote:
| Doesn't match my experience. I know of plenty of startups that
| received EU funding with relatively little hassle. It's not
| that hard. And if you are afraid of some mild levels of
| bureaucracy, you shouldn't be running a company. And it's not
| like the US doesn't have bureaucracy.
| RamblingCTO wrote:
| Both is true: a lot of money is lost to bureaucracy and
| startups get funding, although it's not that easy imho. And
| the amounts are laughable in my experience, that's the
| biggest problem. Yes, it's nice that I get a kickback on
| research costs or whatever, but the process takes weeks and
| the returns are dismal. YMMV tho
| g9yuayon wrote:
| I often read that EU is incredibly bureaucratic and risk
| averse. On the other hand, I also read stories how startups can
| successfully bootstrap themselves via generous support of the
| government, like tax deduction for small companies,
| unemployment benefits for founders, low-interest loans, venture
| investment, free mentorship by very experienced and connected
| executives, and etc. The stories about French and Denmark
| companies are especially impressive. So, I was wondering if
| there's a difference between the governments of individual
| countries in EU and the EU government.
| Irishsteve wrote:
| I know people who've taken money through these routes. The
| biggest surprise is the paperwork; since it's public money,
| everything must be fully transparent, and the government
| needs to justify why funds went to a specific person /
| entity.
|
| In contrast, private investors have more discretion and fewer
| stakeholders to answer to.
| bjornsing wrote:
| > On the other hand, I also read stories how startups can
| successfully bootstrap themselves via generous support of the
| government, like tax deduction for small companies,
| unemployment benefits for founders, low-interest loans,
| venture investment, free mentorship by very experienced and
| connected executives, and etc.
|
| 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.
| izacus wrote:
| Basically like this:
|
| * 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 ;)
| luckylion wrote:
| They are bureaucratic and risk averse.
|
| 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).
| campl3r wrote:
| That's not my experience. I have multiple former colleagues who
| got got EU money for their startup and were able to leave their
| day job due to that funding. I only supported a bit as a
| software engineer but what I was involved in it was pretty
| straightforward.
| arlort wrote:
| A big factor is which country is actually disbursing the
| funds, the EC doesn't really do so directly
| nxpnsv wrote:
| I applied to a few different programs and got funding for
| industry research a few different times. It was some work, but
| still not harder than getting academic research funding...
| artemonster wrote:
| another example how bureaucracy handles "technology":
| https://brusselssignal.eu/2024/08/cash-strapped-german-gover...
| bytesandbits wrote:
| most of the funding will go to incumbents too, not startups. EU
| values establishment over innovation. So you can think of
| German automakers, Airbus and others creating new innovation
| programs and that's where the bulk of many many billions will
| go to. Startups get the crumbles and are scrutinized more
| heavily.
| bjornsing wrote:
| These initiatives always end up the same way: bureaucrats
| distributing taxpayer money to the socially focused careerists at
| the top of large companies and academic institutions (perhaps
| after they've left and founded a startup). It's just so engrained
| in the European way of thinking that you need to "be someone",
| not "understand something" or "be able to do something". It's
| sad, but that's how it is.
| JumpCrisscross wrote:
| > _These initiatives always end up the same way_
|
| By "these" do you mean anything European, or something specific
| to this structure?
| bjornsing wrote:
| I was primarily referring to EU initiatives. But the national
| "innovation system" here in Sweden is pretty much the same.
| It's a cultural issue, not an organizational one, IMHO.
| bgnn wrote:
| EU government funds are also similar.
| bgnn wrote:
| Very nicely put! I have been in discussions with these type of
| people, several times, to start a company in semiconductors and
| quantum computing. I was often the only one who can "do" things
| and it was not appreciated. Academics didn't have the time or
| will to start a company (and had no industry experience), but
| wanted to have more than 50% of the shares because the
| government or EU gave the money to them, in return the
| university wanted 30% cut because they bring "a prestigious
| name", bug companies forced on you by EU funds did't want
| shares but they wanted control (board seat) and IP rights. All
| these were for <500k seed fund which would barely cover couple
| of engineers salary for a year!
| bjornsing wrote:
| That's the typical racket, yes. 20 years ago I saw it as an
| unfortunate consequence of policy mistakes. But now I'm more
| inclined to see it as the intended purpose of these systems.
| "It's not a bug, it's a feature."
| zppln wrote:
| > you need to "be someone", not "understand something" or "be
| able to do something"
|
| 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.
| cess11 wrote:
| The public sector isn't allowed to hire people and do things
| that could be perceived as competing with the private sector,
| which drives paying consultancies for things like software
| development as soon as the result could work as a product
| (i.e. more than one government body would want an instance).
|
| 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.
| carlosjobim wrote:
| Leave Sweden is the solution for people like you who don't
| appreciate how things are arranged. You can be much more
| successful in a more mature economy where there is a better
| connection between productivity and career opportunities /
| renumeration.
| cess11 wrote:
| I don't recognise this description. To me it seems rather easy
| to just grab some cash off EU or swedish public investment
| campaigns by having a credible business plan and a project
| description that fits the campaign.
|
| 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.
| bjornsing wrote:
| > 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.
|
| Not sure what you mean... It fits perfectly with the picture
| I'm trying to convey.
| constantcrying wrote:
| It is not like this is the first time the EU has flushed
| enormous amounts of money into a non-existing sector. The
| results, especially when compared to US venture capital are
| abysmal at producing actual products, especially products which
| could feasibly rival the US tech sector.
| christkv wrote:
| This will be a transfer of money to existing big corp on BS
| projects that go nowhere. How about they just use the money as a
| cheap credit pool for VC's one a 1:1 match for private
| investments and maybe they can even make money from this.
|
| The person in charge is not fit to run a small coffee shop much
| less a 70B fund.
| dachworker wrote:
| Corrupt politicians giving money to their friends in the same
| inner circles. But it will all be above board because the hoops
| you have to jump through to be eligible with be public and
| transparent. Just so happens that their friends will know in
| advance, and be a perfect match.
| landryraccoon wrote:
| Can you be more specific? Which politician is using this fund
| in a corrupt fashion, to help which friend? Please provide
| names.
|
| Or are you simply expressing the same meaningless general
| cynicism that is so predictably and boringly parroted whenever
| any government tries to do anything?
| 77pt77 wrote:
| Only names?
|
| Is it even valid unless it's full names, dates of birth,
| addresses, bank account numbers, receipts and notarized video
| evidence where they explicitly admit to being corrupt?
| littlestymaar wrote:
| I don't understand why people in the comment seem to obsess with
| "bureaucracy" and "taxpayers money". The EIB is, as the name
| says: a _bank_. It has some strategic targeting running, but the
| way it works is through making loans. The EIB is making _profits_
| with its investment activity!
| mleonhard wrote:
| EIB has EUR 500B of capital, invests about 80B/year, and makes
| about 2B/year profit [0]. European states buy EIB bonds which
| pay interest [1].
|
| 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...
| fear91 wrote:
| Why not finance a more wide tax break for tech companies,
| including small companies?
|
| 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.
| bjornsing wrote:
| I could not agree more. But the problem is: then the
| politicians / bureaucrats don't get to decide who gets the
| money.
| Canada wrote:
| > Why not finance a more wide tax break for tech companies,
| including small companies?
|
| Because then these communists wouldn't get to choose who gets
| the money.
| constantcrying wrote:
| Can the EU directly regulate the details of the tax regulations
| of their member states? That would be extremely surprising to
| me and, even if done, would likely be seen as a sever
| overreach.
| enaaem wrote:
| Tax breaks is not going to do much, because that is not where
| the real problem is. Imo EU is being underestimated. The EU is
| really competitive at boring high tech that bootstrap
| themselves like cars, civilian air planes and tooling, so the
| business and innovation climate is not bad.
|
| 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.
| izacus wrote:
| Yep, so much this (and Draghi concurs). It's kind of bizarre
| that the EU needs to do what it's biggest critics fight the
| most: integrate it's markets and eliminate cross-member
| bureaucracy.
| YetAnotherNick wrote:
| > bootstrap themselves like cars
|
| 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.
| arlort wrote:
| It's quite simple. The EU can't tell member states how much to
| tax and even if you cut out all of its budget you'd save maybe
| a percentage point or two in taxes
|
| 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
| zipy124 wrote:
| Because investment is often tax-deductible anyway now-days with
| modern policy trying to encourage this via huge tax-discounts
| on capex. Therefore tax-breaks on profits just allow existing
| owners to cash out cheap. The companies that need the help need
| capital, not tax discounts. Further to this the companies that
| are profit-generating, still require capital for growth, the
| small tax on profits isn't enough to make a difference in the
| scale of things for investment required since corporation tax
| rates are often so low.
| jononor wrote:
| In Norway, you can get 25% tax break on R&D costs. It can be
| combined with other softfunding up to 70% for small companies
| doing research, and 50% for larger companies doing development.
| option wrote:
| I wonder what percentage of that money would be spent on just
| complying with various regulations.
|
| Then it would be interesting to see this % comparison with US and
| China. Could be strongly correlated with ROI.
| sharpshadow wrote:
| As with Germany's 1EUR trillion new credit, of which half goes to
| the military, so will the EIB 'inject' more than half of it into
| the military. Large established tech companies will get a big
| part and quantum startups will see their expected cash flow. Good
| timing for those quantum start ups which have been popping up
| through the whole EU recently.
| nickserv wrote:
| Investing in the military seems like a necessity given what's
| going on. One madman to the east was bad enough, now there's
| another to the west.
|
| The Ukrainians have done some pretty incredible stuff with very
| basic tools and lots of ingenuity.
| bitlad wrote:
| Given that all startups work 32 hours per week.
|
| Thats alot of money to spend.
| Workaccount2 wrote:
| Europe is going to have a hang-over from resting on it's laurels
| for the past 20-30 years. I don't know if people will be able to
| tolerate the changes needed to totally stand independent.
|
| If Europe wants to copy the powerhouse tech industry of the US,
| it's going to have to become more like the US.
| koonsolo wrote:
| It's very hard to copy Silicon Valley, even other US regions
| are not able to do it.
| ExoticPearTree wrote:
| There's something magical about California and New York
| (another tech powerhouse).
|
| 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.
| dustingetz wrote:
| NYC and SF have _private_ capital concentrated in enormous
| quantity. Look to the preceding 5 decades to see how that
| happened, it did not spring up overnight.
| lyu07282 wrote:
| I don't think becoming even more neoliberal is going to solve
| anything for the EU, you people know one button so you all you
| ever want to do is press it harder to solve any problem, it's
| hilarious.
| nickserv wrote:
| You mean the Euro should become the world's reserve currency?
| ExoticPearTree wrote:
| Meaning the EU should stop being so risk adverse, stop having
| 27 different regulatory bodies for the same thing and the
| list could go on.
|
| 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.
| scrollaway wrote:
| If anyone is in the US and interested in coming over to Europe to
| build a startup...
|
| 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.
|
| https://sevenseed.eu/program
|
| 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.
| ayushrodrigues wrote:
| I was happy to read this as a founder who was raised in the UK. I
| wish I didn't have to move to the US to start a company but it's
| starting to feel like a joke here.
|
| > 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.
| alephnerd wrote:
| > I was happy to read this as a founder who was raised in the
| UK
|
| 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.
| ayushrodrigues wrote:
| True, but the EU startup ecosystem is small and shared. Only
| so many places to raise capital from.
| alephnerd wrote:
| Yep! But the overlap between the UK and EU ecosystem would
| be dwarfed by the overlap of the US-UK ecosystem.
|
| 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.
| cheeseface wrote:
| Most startups will use funds like in addition to VC funding. It
| allows you to increase your runway so you're better positioned
| for your next funding round.
| ayushrodrigues wrote:
| Seems plausible but my experience with EU bureaucracy doesn't
| give me a lot of hope that this is worthwhile for startups
| Ylpertnodi wrote:
| Which EU bureaucracy, or all of them?
| owenversteeg wrote:
| There is a lot of discussion here trashing EU programs for
| startups and not a lot of specific details, which is
| disappointing. I will try to provide a more substantive critique.
|
| 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.
| NooneAtAll3 wrote:
| ...so it's corruption with extra steps?
| ithkuil wrote:
| It's a weird kind of corruption where the most diligent and
| patient and boring wins
| arlort wrote:
| No, it's the result of the public's/politicians' pathologic
| risk aversion and swiftness in calling everything corruption
|
| 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
| owenversteeg wrote:
| Personally I wouldn't call it corruption, at least not all of
| it. If you were to drill down into the individual grants, you
| would find a lot of things that are broadly useful but not
| revolutionary. There's 4M euros to produce a new additive for
| beeswax and 500k euros to research migratory snails and 6M
| euros to study some new roads and that sort of thing. There's
| certainly obvious corruption too, but it isn't the majority
| of grant money. Most stuff is just very boring and vaguely
| useful.
|
| 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.
| FjordWarden wrote:
| Imagine a committee of 10 people granting funding to a firm
| to commercialise NFTs of digital fashion where the owner of
| the company is also a member of the committee. The company
| isn't even a real company but a general partnership without
| limited liability. Your inquiries into this affair under the
| public information act get stonewalled by a obscure law that
| where voted on as part of the budget of 2018. When members
| are asked about this incestuous relationship they react in an
| indigenous fashion saying there can not be a conflict of
| interest because they abstained from voting on their own
| project. You make some noice about this and you get
| ostracised. This is just one example.
|
| 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
| smokel wrote:
| _> 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._
|
| 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.
| owenversteeg wrote:
| Hah!
|
| 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.
| hoppp wrote:
| A lot of founders are uni dropouts in America because the
| money flows easily and you dont have to study in university
| to have skills.
|
| 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.
| mcv wrote:
| Why such a crippling policy? Like you said, many successful
| entrepreneurs are university dropouts. For research grants,
| sure, go to PhDs. But if you want a tech industry, you need
| to cast a much wider net than that.
|
| 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.
| ainch wrote:
| I don't know what price you'd pay in your hypothetical
| scenario, but I would say that European universities often
| take a larger chunk of equity than US unis where spinouts are
| concerned [1]. Most US universities take between 0-5% equity,
| where EU could go to 10%, and UK unis up to 20-30%.
|
| [1] https://www.spinout.fyi/data
| notahacker wrote:
| If we're talking about existing EU funding mechanisms, the
| participating universities take no equity in their startup
| partners whatsoever, they just get paid part of the funding
| pot to do a bit of related research and publish it, and
| might be able to generate a bit of their own IP
| bgnn wrote:
| Dutch universities go for up to 25%, just for the IP rights
| [1]. With seed funding etc it often goes up to 30-35%.
|
| [1] Dutch Universities spin-off terms:
| https://www.delftenterprises.nl/wp-
| content/uploads/2023/07/D...
| josu wrote:
| Ha! You must have never dealt with European universities.
| notahacker wrote:
| Yeah this, in fact forget local and just write to researchers
| in your field, or go through dedicated network events.
| Finding a university researcher with a common interest in a
| field who'd consider the opportunity to be subsidised for the
| next 3-4 years working on stuff they're interested in isn't
| the hardest hurdle deeptech startups will face on their road
| to commercialization, especially when the alternative people
| treat like it's some kind of meritocratic sieve is "get warm
| intros to a VC class so insular some of them write _unironic_
| LinkedIn posts about how it 's impossible to be successful
| outside the Bay Area"
|
| (Or just use one of the funding mechanisms that attach little
| or zero weight to academic collaboration)
| bgnn wrote:
| When I did that university's cut was 30 to 50% of shares at a
| top Durch university.
| krick wrote:
| Skimming the comments, this is pretty much what everyone is
| saying. And I'm sure it's true, but I'd like to also point out
| the amount of money in question. What was the investment amount
| for that toy project of Altman? Right.
|
| 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.
| baxtr wrote:
| I agree with everything except for one thing: I think their
| risk appetite is "u" shaped: low-risk is funded but they'd also
| fund insane-risk pie-in-the-sky academia dreams where many
| experts would immediately say that it will never work.
|
| The stuff in between with sensible risk-reward ratios will
| indeed be ignored.
| krick wrote:
| > they'd also fund insane-risk pie-in-the-sky academia dreams
|
| Just out of curiosity, can you throw a couple of examples?
| woah wrote:
| Particle accelerators?
| hoppp wrote:
| Those I think serve a good purpose. We can discover the
| universe one atom smashed at a time.
|
| It's non-profit and would not exist without external
| funding.
|
| The discussion is more about businesses I think.
| zmb_ wrote:
| The Human Brain Project comes to mind.
| Borg3 wrote:
| ITER and cold fussion. Its either impossible (my opinion)
| or far too early. ITER itself will not even produce single
| watt of electricity. Its PoC for net positive energy gain
| from cold fussion (we will see...)
| owenversteeg wrote:
| I disagree. The pie-in-the-sky academia dreams are not risk,
| they are safety. ITER and CERN and similar do fascinating
| research, and I don't mean to throw any shade their way, but
| they do not represent risk. There's not any possibility of
| failure. Things could go completely sideways and papers would
| keep getting written and no bureaucrat would lose their neck.
|
| 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.
| krick wrote:
| Obviously, I don't know what baxtr meant, but I really hope
| it's not that. Because this critique of projects like ITER
| and CERN is really misguided IMO (and honestly just
| harmful). These are not startups, these are pure science
| projects, they are pretty much supposed to have negative
| ROI. It's not even fair to call giving them money an
| investment, these are grants and donations. Money that you
| sacrifice to a worthy cause, that supposedly would be the
| only cause in the fantasy world of communism-utopia, but
| that absolutely cannot get an investment in the world of
| pragmatic capitalism, because it is not about making money.
| owenversteeg wrote:
| Hmm, perhaps my comment was not clear enough. I am all
| for large scale science and have nothing negative to say
| on the subject. I just do not consider them "risk."
| hoppp wrote:
| You are right.
|
| 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.
| loxodrome wrote:
| Wow it's so refreshing to know that other people can see this.
|
| 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.
| whatshisface wrote:
| Instead of giving it all to a few people to spend buying real
| estate and mineral rights, you could tell the funding
| agencies that they're allowed to take risks, or give it to
| people's retirement accounts and let companies seek public
| investment.
| jampekka wrote:
| Looking at what the billionaires are doing in US politics,
| perhaps there's something to this.
| greenavocado wrote:
| Europeans don't just dislike capitalism. They've been
| indoctrinated into thinking that if a business makes money,
| it must be cheating. The entire continent has Stockholm
| Syndrome from decades of leftist academics preaching that
| profit = exploitation, as if every entrepreneur is some 19th-
| century robber baron twirling a mustache. Meanwhile, they
| ignore that every single job, iPhone, and modern convenience
| they enjoy exists because someone, somewhere, took a risk to
| make a profit. But no, better to tax the hell out of success
| so the state can "redistribute" it into black holes like
| subsidized avant-garde puppet theaters and gender studies
| departments that produce nothing but resentment toward the
| free market.
|
| These people aren't just anti-growth. They're pro-poverty.
| The degrowth movement
| (https://ehne.fr/en/encyclopedia/themes/material-
| civilization...) is basically a bunch of trust-fund Marxists
| and tenured academics who've never missed a meal in their
| lives demanding that regular people live worse so they can
| feel morally superior. "Oh, we must shrink the economy to
| save the planet!" Meanwhile, China's building a coal plant a
| week, India's economy is booming, and the U.S. is drilling,
| innovating, and getting richer. But Europe? Nah, they'd
| rather ration meat, ban cars, and freeze in the dark while
| patting themselves on the back for their "ethical" decline.
|
| In America, a 20-year-old can drop out of college, code an
| app in his dorm, and become a billionaire. In Europe? Good
| luck. First, you'll need permits from 17 different agencies,
| all staffed by lifers who've never worked a day in the
| private sector. Then, once you finally start making money,
| the government will take half of it to fund some bloated
| pension scheme for bureaucrats who retire at 55. And God
| forbid you try to fire a useless employee labor laws make it
| easier to divorce a spouse than to fire a guy who shows up
| drunk every day. No wonder Europe's last big tech company was
| Spotify, and even they're based in tax-friendly Stockholm
| because the rest of the continent is a regulatory warzone.
|
| The ultimate proof that Europe's system is broken? Its
| smartest people leave. Engineers, doctors, entrepreneurs,
| they all flee to the U.S., Switzerland, or Singapore, where
| they're allowed to keep what they earn. The ones left behind?
| A shrinking workforce of aging socialists who still think the
| government can just print money forever without consequences.
| And when the economy tanks? They'll just blame "greedy
| corporations" instead of their own economic suicide pact.
|
| The funniest (and saddest) part? The same anti-capitalist
| activists using iPhones, riding in Ubers, and ordering Amazon
| deliveries are the ones screaming for the destruction of the
| system that made those things possible. They want to abolish
| private property while living in nice apartments, end
| globalization while wearing clothes made in Bangladesh, and
| "eat the rich" while sipping $7 lattes. The cognitive
| dissonance is astounding.
|
| If you want to see what happens when ideology trumps
| prosperity, just look at Europe. A once-great civilization
| now hostage to bureaucrats, academics, and activists who'd
| rather see everyone equally poor than let a few people get
| rich. The U.S. has its problems, but at least it still
| rewards hustle. Europe? It's too busy taxing, regulating, and
| guilt-tripping itself into irrelevance. Wake up, Europe.
| Capitalism isn't the problem. Your hatred of it is.
| loxodrome wrote:
| Amen, I should frame this on my wall.
| pembrook wrote:
| Your description of the European intellectual climate is
| entirely accurate.
|
| But I think your analysis of its root causes is lacking.
| European humans aren't different organisms than non-
| european humans. Culture does not form in a vacuum. It
| comes from base properties of the geography and experiences
| of humans in the region.
|
| In my opinion, it's primarily down to 3 things:
|
| 1) Population density: Europe has 3X the population density
| (and subsequent urbanization) as the US. Urbanization leads
| to more collectivist attitudes. If you compare European
| attitudes to those in a high density American location like
| New York City, you'll be amazed how similar (in everything
| from religiosity to socialist economic leaning to political
| philosophy). It's the higher proportion of low population
| density areas of the US that lead to major differences in
| political philosophy.
|
| 2) Experience of downside risk: European risk aversion is
| quite easily explained by the fact they have experienced
| the most extreme version of downside risk imaginable in
| recent memory (WWII). The worst thing the US knows is a
| depression. Not total annihilation, fire bombing and
| markets going to 0.
|
| 3) Ethnocentrism: Europe's nationalist ethno-states are far
| less culturally diverse than the broader US. This leads to
| a higher capacity of empathy for strangers (because people
| in a mono-culture are more similar to you, you empathize
| with them more easily). Ironically though, this empathy is
| what leads to a higher percentage of GDP being driven by
| centralized government spending (50% in Europe vs.
| 30-35ish% in USA). The market is less empathetic, but
| ultimately more efficient and grows the overall pie
| faster... _even accounting for the additional increase in
| inequality._
|
| Growth compounds exponentially, so this gets more dramatic
| over time. People in podunk US Midwest States now have a
| higher disposable income per capita (on both mean and
| median measures) than people in London, one of the most
| 'aspirational' cities in the world.
| ClumsyPilot wrote:
| > anti-capitalist activists using iPhones, riding in Ubers,
| and ordering Amazon deliveries...
|
| > every single job, iPhone, and modern convenience they
| enjoy exists because someone, somewhere, took a risk to
| make a profit.
|
| Amazingly capitalists use things invented by socialists,
| like satellites, or the LED. Or things invested by Nazis
| and Monarchists.
|
| Their favourite iPhone is made by communists, with minerals
| mined by .. well I am not sure what you call em but they
| are not capitalists
|
| Every day Capitalists use public sanitation, running water,
| Education, GPS, police and prosecution but they imagine
| they could exist in a mad max world instead of dying of
| cholera
| somethingsome wrote:
| Honestly, in academia you have good hands too, just not every
| lab. As in business, you also have not so good businesses.
|
| 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.
| ClumsyPilot wrote:
| > 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
|
| 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
| loxodrome wrote:
| Bullshit. All the big VC firms in the USA are funded by
| private investors (rich people). They fund risky tech
| startups because big, fast gains are possible and the
| marginal capital gains tax rate is 20%. In the UK it's 39%!
| But 24% for residential property, hence the focus on real-
| estate that you mention.
|
| Tax less, and prosperity follows!
| owenversteeg wrote:
| Funny enough, I don't actually think the money is quite the
| problem that people think it is.
|
| Look at the early days of YC. Single digit millions a year
| were 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.
| PicassoCTs wrote:
| They are also milked by companies, who re-designate pre-
| existing works (like software projects) as "innovation" and
| R&D. Its basically a hidden tax-refund with loads of busy-work
| bureaucracy.
| jopicornell wrote:
| I cofounded a startup, trying to get innovation funding and I
| can say this is 100% my experience. Universities don't think a
| Software for managing dance and culture academies is
| innovative, but they are in the field.
|
| 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!
| huqedato wrote:
| You are perfectly right!
|
| 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 EUR16,000, 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.
| thih9 wrote:
| The article addresses some of these points:
|
| > EIB President Nadia Calvino 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.
| alephnerd wrote:
| That's part of the problem. 6 months is too long for an early
| stage venture to get capital unlocked.
| ajb wrote:
| There are a lot of grants for universities because a) that's
| how universities are funded and b) to encourage technology
| transfer. But pure startup funding does exist, eg the EIC
| accelerator. If you want to get it there are companies like
| Inspiralia which specialise in navigating the process.
| HenryBemis wrote:
| > will be distributed to members of the bureaucratic class and
| their network, for low-risk, low-reward projects
|
| 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.
| constantcrying wrote:
| The US has a start-up culture heavily centered around venture
| capitalist investments. The EU is currently trying to _be_ the
| venture capitalist and to create a European start-up culture
| where none was before.
|
| 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.
| sylware wrote:
| You mean ultra performant RISC-V 64bits microarchitecture CPU at
| 18A manufactured in EU?
| donperignon wrote:
| From my personal experience this funds most of the time end up
| being absorbed by big corporations that had the contacts and the
| bureaucratic muscle. So basically it's throwing away 70B euros of
| citizen taxes.
| _zamorano_ wrote:
| Exactly this. Imagine the slowest consultant firms, with the
| most powerpointists, huge hourly rates for very simple projects
| that pay peanuts for the not so bright devs...
|
| These are the companies with the connections that are getting
| the money.
| nish1500 wrote:
| I am in the process of moving my startup from Canada to Germany.
| I started in India, so I have experience running a bootstrapped
| business on three continents. I am not looking for funding, and
| in fact use the business profits to invest in other companies.
|
| 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 EUR70B is going in the pockets of bureaucrats and
| consultants, assuming any startup sees a dime within 3 years.
| maelito wrote:
| As someone working on a project funded partly by the EU : there
| was no bureaucracy or very few.
|
| It's great.
| DoingIsLearning wrote:
| Can you share what vehicle you used for funding?
|
| 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.
| Zigurd wrote:
| It's unclear to me if Europe can move any faster than they can
| boot strap a VC culture. They can only grow a cadre of VC
| partners through experience. Some American firms have branches in
| Europe, and there are some European VCs that have decent scale,
| but I would guess it's 1/4th the size of the US venture business.
| Maybe less if you factor out investment that doesn't really look
| like US venture investment. European institutions should step up
| in the role of limiteds.
|
| 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.
| bli940505 wrote:
| What does "inject" mean here? Iirc, Israel did something similar
| a while back and boosted a ton of startup early on, but they
| quickly died off and they realized you need the scrutiny from
| free market VCs to create competition.
|
| for a lot of startups
| hintymad wrote:
| Does anyone know if any non-EU citizen can get such funding to
| start up a company in Europe? Say, an American?
| amelius wrote:
| They should start funding Mozilla, imho. EU's stance in consumer
| protection is a great match. Plus it is strategically smart to
| have a browser under your own control.
| andy_ppp wrote:
| EUR70bn is 150,000+ YC seed rounds?
|
| This seems like A LOT of cash filtering into the system whichever
| way you cut it.
| PicassoCTs wrote:
| If you want to start something in tech- you got to eastern europe
| in europe. Everywhere else, established industries and clubs will
| leach all the motion from you. But in poland, the baltics,
| Finland -you somehow can start things and its still reasonable
| easy to set things in motion. And there is nobody there to stop
| you.
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