Ask HN: What is the best city to start a start-up in Europe?
What is the best city to start a start-up in Europe?
* 7% of all of European VC is invested in Cambridge (http://noweurope.com/2010/01/13/case-study-what-can-we-learn...), which is not bad for a City of 125,000 people.
* Close enough (50 mins by train) from London's ecosystem of VCs
* Close to Stansted airport for easy access to the rest of Europe
* Large density of tech companies, and tech competent employees. Similarly the professional advisors (lawyers/accountants) etc understand startups.
* Costs are (generally speaking) considerably less than London. Most costs (rent, salaries, professional fees) are 20-33% cheaper than London.
* Pleasant attractive historic town.
* One of the world's best universities, along with a significant research presence from the likes of Microsoft ensures there's lots of smart people about.
* For a long time Cambridge companies have been interesting startups but not made successful large businesses but the likes of ARM, Autonomy, CSR etc have all grown up to be billion dollar businesses.
Having said that Cambridge has a long history of innovation and tech startups.
EDIT: Forgot to mention Cheltenham. Chelly's an interesting place, if you're looking at dealing with certain areas of UK government it's a good place to start up, but getting to/from London/anywhere else can be difficult.
It's worth knowing that the average house price in Cambridge itself is now higher than the average in London, though, and that the local authorities are almost religiously anti-car, which makes the city centre area much less attractive (in a business sense). If I were planning a start-up with funding for significant numbers of staff, I would probably aim to be based on one of the business parks on the outskirts, or in one of the smaller towns/villages close by. That way, you're still within easy reach of the people, industry and support services, but day-to-day running costs and accessibility for local employees who don't want to walk/cycle in every day and for professional visitors driving to your premises are better.
It seems a bit daft to be choosing a location based on the convenience of the hypothetical middle managers and mailroom employees you'll have in a successful future. Sure it's professional, but it isn't startup. Burn your business plan, remember?
It's not just the middle managers and mailroom staff, though. Most people in Cambridge don't live near the city centre, because it's an old city and much of the space is taken by either the university or business premises. There are, however, many residential areas on the outskirts, and a whole string of surrounding villages.
Plenty of tech companies have set up in the middle of Cambridge, but with the transport policies of the local authorities, car access and parking is absurdly difficult. That makes it awkward to host visitors if you need to, and it is a genuine recruitment issue in that not everyone is willing to walk, cycle, or rely on our less than stellar local bus service for routine commutes to work from the surrounding area. Setting up on one of the business parks -- which are still within cycling distance of the city centre for keen cyclists based there, but also easy to access by car and usually by bus as well -- seems to have all of the advantages of being in Cambridge, without the unnecessary travel limitations.
The only real down-side is the focus on hard science patentable IP - which makes it a bit more difficult to get noticed if you're not in that space.
Similarly with VCs, they're all big funds that invest in hardware - no seed fund activity here.
Rent costs in Cambridge are (IMHO) the same as London.
I don't think there are that many tech people in Cambridge, tons of students, but don't expect google analytics discussions down the pub in Cambridge.
If I were doing web or software I'd recommend London over Cambridge.
Also gets on soapbox Cambridge is far more interested in where it has been as opposed to where it is going.
A couple of people have said that now. What problem(s) do you see with running a web or other software start-up in Cambridge? A lot of people seem to be doing so.
> I don't think there are that many tech people in Cambridge, tons of students, but don't expect google analytics discussions down the pub in Cambridge.
Are we both talking about Cambridge, UK? IME, it's filled with tech people...
> A couple of people have said that now. What problem(s) do you see with running a web or other software start-up in Cambridge? A lot of people seem to be doing so.
There really isn't an entrepreneurial ecosystem in Cambridge for software. There is plenty of stuff for freelance or whatever. I know of two startups that have relocated from Cambridge to London because they couldn't get the technical talent in Cambridge (Rails in these examples)
>> I don't think there are that many tech people in Cambridge, tons of students, but don't expect google analytics discussions down the pub in Cambridge.
> Are we both talking about Cambridge, UK? IME, it's filled with tech people...
I mean tech hackers, rather than academic people
(We moved Timetric from Cambridge to London towards the end of last year.)
There are 2 larger world-class companies (Skype and Playtech) that have 3-400 people in tech & development here in Tallinn/Tartu, which can sometimes be a problem for startups competing with hiring. At the same time, many people are also leaving those big companies for startups.
Still I believe locating sales, marketing and any customer facing operations in consumer space in SF Bay Area or NYC/Boulder etc. Having product development and anything tech related in Central and Eastern Europe makes a lot of sense on other hand.
I am curious about the banking issue as well. Never heard of it being that difficult. Working visa are indeed becoming increasingly difficult, but I am afraid this is a trend that is not restricted to France.
I think the issues in Paris are much closer to the toxic environment mentioned by the OP. I know several people who founded their own company just to avoid the usual IT job which consists in being a semi-slave for one of the numerous consulting companies.
And about the issue about being a semi-slave : I worked for many startups in Paris and I never felt that. Of course if you take the consulting way you can't really compare with startups. And yes an internationally competitive salary is required and it costs an arm for the employer.
look at what cost an employee in France
An engineer in France is way cheaper than an engineer in Silicon Valley. Taxes on salary are indeed higher, but the base salary is so much lower that in the end, France is cheaper. To give you an idea, a basic salary in Silicon Valley is $100K, the equivalent in France would be below 50K€. Those cost the employer about $120K and 75K€ respectively, so you can see which is cheaper.
On top of that, France has a pretty good tax incentive for R&D engineers. You can almost get all your money back as the employer, it's frankly crazy (it's called CIR). But nice for startups.
The main issue in France is the complexity of navigating all the government aid. It's a patchwork of measures that don't fit well with one another...
Concerning the cost of an employee: one thing to keep in mind is that once you paid your employee, he already got his basic retirement and health plan in place, contrary to the US and pretty much everywhere else outside western europe. As an example, I earn more here in Japan than in Paris, the cost of living in Japan is certainly cheaper than in Paris, and taxes are low but in the end once I factor out the cost of health insurance, retirement, and maybe soon sparing money for children's education, France is really not so bad.
I actually know several friends who came back to France after earning "so much money" in the US, especially once they had kids.
Bring some facts in here, leave the conclusions to us please. As for getting the "government support for young companies", isn't negotiating with Sand Road VCs a skill of its own as well ? What about scoring DOD contracts ? Both require immersion in a culture with specific goals, myths and traps.
It's high, not hight (I'm French too).
But as you see from the other replies there's not one particular region that is so far ahead of the rest that it can be called the startup centre of Europe. Berlin, Barcelona, London, Stockholm... the startups of Europe are spread all over the place.
The startup scene is growing, there's a lot of pressure from the government to create new companies. See: http://venturecup.dk/ http://www.vf.dk/?sc_lang=en
I'd be more than happy to link to sister initiatives in other countries!
The main problem is that salary and taxes are very high.
Remember, Sweden and Denmark hold the #1 and #2 position for highest taxes in the world.
Having said that, I actually plan to be employed 4 days/week and try a startup on the 5th. We'll see...
What happens to the 2 free days most people call a weekend?
London for sure.
I agree that italy should be avoided, but for other reasons (mentality, corruption, etc)
The problems in Italy for an internet company are 1) bureaucracy 2) the fact that many potential employees are going to value stability over the good things about startups 3) fairly high cost of living in many places (Milan is expensive and an armpit - hot and humid and smoggy in the summer, cold and clammy in the winter).
That said, there are an awful lot of bright and creative people here. I hope that we'll see that potential unlocked sooner, rather than later.
BTW, here's a more in-depth article about Italy's problems, although some of them are not so applicable to internet startups:
http://www.nytimes.com/2010/08/01/business/global/01italy.ht...
It's a trivial obstacle anyway. You only need the money in an account on the day of incorporation.There are a number of companies that will lend it to you - for a fee, of course. :-)
And, at least in Italy, the 'social capital' thing means that the money has to go into the company somehow - you can't just borrow it and then give it back to the bank the next day.
And 6k euros for "2 guys and an idea in a garage" can be a lot of money.
Agree for mentality, people might want stability.
Corruption no, here in the north there's almost none - that I heard of, at least. And if you aren't selling to the government how is that a problem anyway? You only need an internet connection
The Baltic states, especially Tallinn, have benefitted from Skype; the Scandinavian countries are full of developer talent. They're also full of English speakers, and if you're looking to go global, that doesn't hurt.
If you're doing hardware or biotech, the answer's Cambridge, though.
All that said, there are amazing, interesting and fun people here doing cool things with tech, and there's the beginnings of a great scene. I love it :-)
But my main reason for posting was to ask: is there a directory of some sort compiling answers to questions like this for cities globally, detailing the sort of recruitment and funding opportunities available, as well as what sort of startups are already based there? Almost like a "Crunchbase for cities"...might have to think about knocking such a thing together if it doesn't already exist!
SF has the whole echo chamber thing going for it, which can be a huge advantage, and it has tons of little startups to interact with. Nowhere else has either of those, so there's no particular reason to pick one place over another.
In Europe, I've set up shop in Pamplona, Chamonix, Kalymnos, and now in a little town up in the Lake District of England. Each has pretty much exactly the same startup culture, consisting entirely of me and whatever other developers I've brought out with me.
Dimensions to assess that would totally change the selected country:
- A start-up in which business domain?
- What will you sell?
- Who are your targeted customer? Where are they located?
- Where are you main competitors?
- Where is the best "ecosystem" in your domain that could help you/partnership with?
- Do you need some VCs?
- Tax optimization requirements?
- What is your "exit strategy"?
Hint: be located close to your competitors, partners and of course... customers.
I went to the Techcrunch event in May and there seemed a few interesting wee companies and at least one sensible VC around.
Edinburgh is a gorgeous city with a great atmosphere and fairly convenient for the Highlands if you like outdoor sports (the skiing in Scotland last year was particularly awesome).
The main downside to Edinburgh is that travel can be a bit painful - although it is a lot better than it used to be.
Are you self financing and have limited run way? Go to cheaper places.
Anyway, I like Amsterdam: People speak English and the state provides a lot of stuff for free if you're not making money yet (child care, health insurance, even access to museums). Once you start making money get out of there or pay the worst taxes in the world ;-)
The solution is an offshore: you start your company in a low-taxes European country (Cyprus, Bulgaria) or a tax haven, you live close to an ecosystem (near London, for instance) and you hire developers from Eastern Europe (low wages, highly skilled).
Åland Islands (Fi) - no VAT
Jersey (UK) - no VAT on goods sold, as long as items cost less than £18 and are posted individually, no import taxes to mainland UK
Estonia - no corporate profit tax (flat 21% tax on dividends)
That's where I live and work, can't say it's easy to get money but I'm pretty sure I don't know the right people yet. :)
I also have a hard time believing Geneva, have you actually been there? In Switzerland I would understand Zurich or Lausanne, but Geneva does not even have a technical university, compare that with ETH and EPFL.
* ETH (availability of talent from a good computer science research university)
* Good transportation alternatives (you can get a direct flight to/from Zurich from/to most major airports, direct high speed trains are also available to France and Germany)
* Business friendly tax rates (relative to other European countries)
* Switzerland, in general, has high quality of life
Side note, Google has a sizable office in Zurich and is able to attract and keep talent from both Western and Eastern Europe.
Besides the banking sector the city is dead. No user group activities, no "cool shops" or startups. Highly expensive like Munich and Hamburg without having real benefits besides the great airport.
Would be interested in hearing more about it. Anyone?
I am not sure if there is much of a startup culture here, though...
http://news.ycombinator.com/item?id=1565375
"Bratislava- Near vienna, but relatively low cost. Seems to be growing in leaps and bounds and has a well educated populace. Environment of low regulation and capitalism, so this could be the startup hub of the next decade. Might not be that now."
Cost of living is very high in London.
Slovakia has improved a lot lately. Some thing which I didn't expect before visiting Slovakia, was the lack of English skills among youth. They seemed to speak better German than English.