Four reasons why US companies should invest in Europe
by Toni Cowan-Brown
There are many articles written enumerating the various reasons why European companies should invest in the US and/or locate there. However, much less is said about US companies and organisations coming to Europe.
What does it take to succeed in Europe?
I have lived in Europe my entire life and have seen first hand how difficult it is to set up a company on the mainland of Europe (harder in some countries such as France and Belgium).
I have also seen many friends leave Europe and set up their dream company elsewhere where funding was easier to find and rules less onerous. There are of course counter-examples (such as BlaBlaCar, Ventes Privée, Zalando, Sound Cloud, Just Eat, Shazam, Net-A-Porter , Rasberry Pi, Sky Scanner — all of which are and remain proudly European) but generally speaking the commonplace view is that “regulated Europe” is just not start-up friendly.
I have worked with large tech companies who were entering Europe in force. Most faced the same problems, namely navigating what is a complex and different market with 28 different legal systems, languages and cultures…
It is not enough to say that your company is an important source of creativity, innovation or employment… all of which are sure to have the potential to help Europe create new jobs and new wealth. You also need to demonstrate that you are going to adapt and tailor your product(s), service(s) and even the way of conducting business in the European marketplace.
Companies which succeed in Europe are those that understand that every country and every city needs to be tackled individually and with a certain amount of respect for European, local and national rules and laws. Sure, London might be the right place to start your international expansion but keep in mind that London is not representative of the rest of the UK. Furthermore, it is not because you succeed in London (UK), you will be a success in the rest of Europe.
Simply put, we do things differently here in Europe and we appreciate people and companies which understand this and design their offer accordingly.
Another success factor is to hire local talent and expertise — you will need people who understand the European continent and culture and who are aligned with European business tactics.
Now for the key reasons to invest in Europe.
Four reasons you should invest here in Europe
Sure enough, entering the European market is tough and challenging but it is worth the hard work.
Firstly, Europe is at the same time both a forward thinking progressive continent and also more traditional in many ways than the US. We have some extremely creative, innovative and high-energy tech hubs (or poles of excellence) across Europe, from Berlin to London, from Paris to Warsaw, from Tallinn to Amsterdam…
The diversity of cultures, experiences and ideas is present across the whole of Europe and this same diversity is a massive added value to start-ups willing to hire a wide variety of experience and talent. It is not uncommon to find a London-based tech company with only 30% of British employees — thanks to Schengen and the free movement of people.
Secondly, European Entrepreneurs are used to being faced with a plethora of constraints such as the lack of funding or access to capital, the need to navigate a complex set of local, national and European legal systems and a talent base that is continuously leaving for the US or constantly doubting the environment their countries provides for startups.
As a result of this, Europe boasts a unique and innovative ecosystem full of resilient, innovative and resourceful entrepreneurs.
Thirdly, and probably most importantly, Europe is the largest developed single market in the world. It is a developed mature economy with transparent rules and regulations. It is also the biggest player on the global trading scene with 500 million customers looking for quality, modern goods and services.
If you are able to navigate the complexities of Europe and if you take your time to do so then you can potentially have access to a very large customer base.
Fourthly, many in Europe still look to the US for future-proofed tech. US brands can win in Europe where real growth is possible (think of companies such as Airbnb, Stripe and Netflix that all understand the benefits of a carefully thought out international expansion).
You have a unique opportunity to enter a market that might not be aware it wants or even needs your product(s) or service(s). Meaning you can set the standard and capture the European market.
So, should you come to Europe?
☑ There is loads of money to be made in the largest single market
☑︎ A plethora of high skilled workers
☑ A booming eco-system to help you penetrate the market
☑ An appetite for technology and innovation (for good)