Go Viral, a social video network that happens to hire very, very smart people (including my friend Rene) has received funding from Kennet.
This is a very interesting space... a bit like SEO for the beginning of search, handholding advertisers and linking them up with the networks...for a fee. As the Brits say, "watch this space."
Martin Varsavsky, Argentine-Spanish-entrepreneur-excellence and the poster child for European founders just posted an insightful - but depressing - piece about the challenges facing entrepreneurs in Europe.
It focuses on cultural attitudes towards risk and failure
"USA has a lenient view of failure. Failure in America is not seen as a lifelong chronic disease but as a test of character. VCs in the States look for people who have had a combination of successes and failures as they are more prepared to deal with the tough realities of business life. In Europe however failure is seen as just that, failure, a stigma that stays with you for the rest of your life."
and the legal nightmares faces by founders (who become personally liable) "In Europe going bankrupt is the same as firing all the employees and you as the founder, PERSONALLY owe the money that has to be paid to the employees for letting them go even if the business has done nothing wrong. "
Add to this the challenges of scaling a business across many countries and languages (incremental cost not faced by US start-ups) and legal issues of cross border transfers, capital repatriation, and "worker rights" (see french ability to manipulate this clause) and it does prove that building a globally-competitive start-up from Europe seems to have the cards stacked against the entrepreneur.
Saul Klein, Index Venture Partner, Seedcamp founder and Skype lucky-dog exiter, did a presentation on European startups and VC in Berlin last week. Fred Wilson posted it on his blog.
Some interesting insights around
- Three of top $1B+ markets for VC now in Europe - Some pretty famous (and wealthy) firms were started in downturns (Apple, Microsoft, Skype, MySQL) - Bootstrap as much as you can - Use free resources (Gears, App Engine, Seedcamp)
European VC (and European startups) still face several challenges around the cost to expand (localization, infrastructure, feet on the ground) across the region, the return from VCs (and therefore the funds flowing into it), and the public markets. That being said... Seedcamp and Saul's efforts are some of the best efforts going on to build up the next Skype.
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