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Politics by Other Means

There are many theories as to why Europe punch under its weight when it comes to consumer technology, from mentions of a vague mindset” problem (some sort of cultural lack of ambition) to an unfavorable regulatory environment.

To understand, we should consider the fundamental difference in the way Europe and America think about business.

There is a strong will, in Europe, to keep the power of the State clean from the influence of any potentially competing organizations. What the french call laïcité (secularism) is a tremendously important concept - and its principles goes further than religion. The official definition of laïcité describe it as the principle authorizing all opinions, as long as they do not constitute a threat to the the public order.

This defiance for any potential threat to the legitimacy of the state shows itself in Europeans’ attitude towards business. In Europe business is about money and nothing else. Companies here tend to stay true to their official mission: to provide the largest return possible to their stakeholders. In practice, both business and political elites swim in the same waters, but the electorate do not tolerate open camaraderie between the two. It’s much rarer for European business magnates to run for public offices than their American counterparts. The slow growth of the region results in companies tending to be happy enough with niches providing them with a comfortable revenue stream.

To contrast, in America, business is an unofficial branch of power. Americans’ historical distrust of the State gives more leeway for corporate boards to dream about being more than money makers. Silicon Valley startups’ famous obsession for changing the world” is not an innocent laïus. American companies are after power. And in order to get it, they look for the part of the value chain giving them the most leverage. The FAANG most striking characteristic isn’t their EBIDTAA, but their absolute dominance over their respective ecosystems. And to reach that position, investors are ready to unload huge sums of cash into money losing entities, as long as the resulting corporations stay dominant.

This is best exemplified by Peter Thiel stating that:

The next Bill Gates will not start an operating system. The next Larry Page won’t start a search engine. The next Mark Zuckerberg won’t start a social network company. If you are copying these people, you are not learning from them.

Microsoft, Google and Facebook are the height of what business is truly about in the American tradition: leverage. And none of them seem content with making money - they seek influence in bolder ways than more traditional companies (Facebook’s Libra & Internet.org initiatives come in mind)

By comparaison, as Dan Wang indicates, the best-known German tech entrepreneurs may be the Samwer brothers, who are notorious for copying successful ideas from Silicon Valley to try to scale them in other markets”.

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