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As technology upends industries and lifestyles at breakneck pace, the Old Continent is not producing any of the online giants like Google, eBay or Facebook. Its best and brightest prefer to emigrate to Silicon Valley, or sell their ideas on to U.S. firms before they have a chance to establish themselves.
The European Union's top executives in Brussels are trying to rectify that with a long-term plan of reforms and incentives but face an uphill battle. The 28-nation bloc is, above all, lacking in the risk-taking culture and financial networks needed to grow Internet startups into globally dominant companies.
Europe's relatively cautious attitude to investment stands out as one of the biggest hurdles—and among the most difficult to change. Investors in Europe want to see that a young company can generate revenue from the start. Europe's many high-technology companies are focused on manufactured goods that can be sold right away to generate revenue—industrial equipment, energy turbines, high-speed trains, medical devices, and nuclear energy.
By contrast, Internet companies often have little to no revenue at the beginning. Twitter and Facebook, for example, first focused on building up their user numbers. Only once they were established as global forces did they put more attention to making money, through advertising and other strategies.
This difference in mentality stands out as one of the key reasons that Europe has fewer venture capital firms and less investment in startups than the U.S. or Asia.Over the past five years, U.S. venture capitalists spent $167 billion on new business ideas compared with some $20 billion by their European counterparts, according to the National Venture Capital Association.
http://phys.org/news/2015-09-europe-isnt-googles-facebooks.html
(Score: 0) by Anonymous Coward on Wednesday September 23 2015, @08:53AM
In Germany, there are the VZ networks (StudiVZ, etc.), [wikipedia.org] which are not that successful. So it's not that there is nobody trying; the reason must be different. I guess it's the greater cost of maintaining a dozen languages before you can even think about growing large.
Note also that there's a network effect involved (no pun intended): The larger a network already is, the more likely new users will join that network, and the less likely existing users will leave it. Note that even Google couldn't compete well against Facebook, and that's after having grown to a big company with deep pockets, and with many people already having a Google account for using other services.