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Merlin Egalite
@merlinegalite
Today, I'm sharing Nicolas Colin's takes on the European startup landscape, which I think are enlightening and that we, as Europeans, should be lucid about. I hope they'll get more visibility. Nicolas is a former co-founder of The Family (a famous French accelerator that went to a halt). Even though it's closed now, I think they've been pushing many ambitious young people to build stuff. I believe @alexmasmej.eth can relate. So here's the recap: 1. Europe is falling behind on every metric VS the US. 2. European companies should follow their own playbook and not follow Silicon Valley's one that isn't working here. 3. What Europeans should be building: "building profitable tech companies with a multinational footprint that happen to be headquartered in Europe" with the goal of maximizing Europe's ROIC. 4. How? By developing "a unique positioning that leverages our distinctive attributes rather than trying to copy approaches that succeeded elsewhere." We need to make trad-offs.
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Merlin Egalite
@merlinegalite
5. Accelerators like The Family or Ycombinator work well only when they have something to pass on. Europe has no such a thing. Focusing only on the early stages is missing the point that a broad ecosystem with existing success stories must be in place. 6. We're entering a state where the tech landscape is more predictable, which has several implications: (a) being 1st matters less, (b) resource allocation improves, (c) latecomers can catch up, and (d) defensibility becomes crucial. Europe is a developing region from a tech perspective but can catch up as history has proven (e.g., the automobile industry).
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Merlin Egalite
@merlinegalite
7. Europe lacks a collective mindset and cannot rely on a centralized approach to orchestrate this. Europe is not a homogeneous block; it's a patchwork of many typical countries. Hence, a decentralized approach must be used instead, led by Eastern European countries with "fewer preconceptions about what's possible, less attachment to legacy systems, and a natural orientation toward global markets from day one". 8. How to do this? This is, again, a coordination problem :) To put things in motion we need compelling stories & narratives to inspire (Project Europe is working on it). Europe must (a) act as if it's a developing economy with high potential growth, (b) find its strategic positioning (where we're good at) through decentralized actions, and (c) iterate until Europe finds its own PMF.
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Merlin Egalite
@merlinegalite
9. The European tech ecosystem is fragmented, but drawing from the Rothschild banking dynasty, founders can follow the same methodology: leverage local knowledge while maintaining a multi-national outlook. 10. European companies can overcome this patchwork by buying companies in other localities to consolidate into one single company, as successful examples prove (klarna, deviant, etc.). European complexity if overcome, can become a moat against American/Asian competitors. 11. What to do: stop trying to fix what's broken; follow the flow instead of going against it; stop investing in many various small-scale companies but rather consolidate capital and resources around the ones that are truly successful, and buy back others smaller ones to do so; don't fight brain drain, embrace brain circulation instead; make regulation and compliance easier and finally leverage europe manufacturing heritage to capitalize on AI and computing.
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Merlin Egalite
@merlinegalite
TLDR1 Europe needs an inspirational long-term vision that leverages its uniqueness instead of repeating playbooks that don't work. TLDR2 Inspire, build, consolidate, iterate.
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Vinay Vasanji
@vinayvasanji.eth
Re #10 — will be partly solved once the 28th regime is enacted, more here https://www.eu-inc.org/ If the EU has a predictable and well understood framework like Delaware then it goes quite a long way in terms of simplifying capital allocation
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