Startup in Europe?
We have all read Paul Graham's writings about why the USA and Silicon Valley are the best places to start business. I have no troubles believing him. But some of us are less lucky to have been born in Europe (although it could be far worse).
And I know it's possible to start an American company, even if I have no US passport, but still, that involves traveling to the USA (with all the hindrances like visas etc.). I live in one of the newer (cheaper) members of the EU and with the money needed for such a journey, I could easily live for months (and maybe even a year) while developing my product.
So I guess, I'll first try doing it here.
Could anyone suggest better (or less worse) European country for starting an IT company? I'm talking about the legal part only, not living there.
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[ 3.3 ms ] story [ 59.4 ms ] threadThe thing that impressed me most, however, was when I read that they are a nation of only 1.4 million people, so they have to go after every opportunity they have in order to make things more efficient. The Government's goal is actually to make the public sector so efficient that they can fire state employees and "free up resources", i.e. workers, for the private sector. Of course, this policy must have created some problems in the last 2 yeas, but overall the impression is that they are a country on the right path. Finally, the three Baltic Republics - I have visited Estonia and Latvia, but not Lithuania - are countries that share many traits with Scandinavian countries and that look up to Scandinavian countries. I personally expect them to do very very well.
1) get a high-paying job in a European country 2) after 6 months, start doing a lousy job & get yourself fired. 3) Leach on generous social security until your startup takes off. 4) ... 5) Profit!
You can received unemployement help for 2 years, given that you worked enough before (it is roughly 70% of your salary, but decreasing over time ). You can also ask a part of that money up front, but that will cut your right.
There is also an interesting "autoentrepreneur" status that is nice if you want to boostrap something that allow you to be registered as a company but ask you minimal accounting, simplify registration and only tax you if you earn anything. It's important because company are taxed more than in the US.
Salaries are lower too (it's not very easy to accumulate 6mo/1year of cash in advance ), few peoples speak english, so you really need to speak french to start something in France.
http://www.doingbusiness.org/documents/Simulator_2010.xls
It's from the World Bank, comparing how easy it is to do business in different countries. Last time I checked, US was 4th, the UK was 5th, and Ireland (where I live) was 7th.
If you want to consider Ireland, it's got a very 'pro-business' attitude, strong US connections, well-educated, English-speaking workforce, political stability, little bureaucracy, many grants and supports available from state agencies to promote entrepreneurship, and a very low corporate tax rate of just 12.5% (there's further tax breaks available if you are doing R&D). However, it's expensive here.
As regards taxes, Accenture moved their Global HQ here from the Bahamas because of tax advantages, and many multinationals have their European HQ here also (Microsoft, IBM, Google, Apple, Pfizer & most of the Big Pharmas). Also, from what you have said, I'm guessing you are Eastern European - well there are many of your countrymen here, so you won't feel totally homesick ;-)
Despite all that, I'm actually considering travelling to Silicon Valley in September to scope it out, and to try to determine if I would like working in a startup (i.e. if I would be suited to doing my own startup at some point). My work contract expires then, and I've taken on board some good advice from a successful American entrepreneur who strongly recommended it.
So I'm in a somewhat similar position to you. I'm seriously considering moving to Silicon Valley to at least give it a shot, the odds of success are much higher for all the reasons mentioned in pg essays and the articles on 'moving to Silicon Valley' that appear from time to time here on HN.
I agree with all you said about Silicon Valley. But we are already a nice team here. We have several "hobby" projects (which all failed back then) behind. And now we are going to do it "for real". Of course, we may be moving somewhere else in the future, especially if we come to the need to hire more people. But for now we are just going to live cheap in Bulgaria and work :).
Now, legal issues are tricky everywhere. But one thing you need to think about is how labor intensive will your business be ? Some countries like France or Spain make it almost impossible to fire people whereas countries like Ireland or Switzerland offer much more flexibility.
But chances are high that you won't start by hiring a lot, right? Then, what you need to focus on is: how easy is it to grow a business and what would happen if you fail. You want to be able to add shareholder easily, while keeping administrative duties under control and you don't want to get into too much trouble if you need to file for bankruptcy. I heard Germany and the UK might be good choice if that's what you're looking for (not very sure though, please check ;)
Finally, if your startup will not be labor intensive, nor capital intensive at first, my advice is: don't overthink legal aspects. Go where you have the best networking opportunities while being able to hire great people at best cost. And that might just be exactly where you're living now...
Oh, one last thing. Europe has everything you'll ever need in terms of talents and capital. So I don't agree when you say that you're "less lucky to have been born in Europe". But that's another story ;)