"One of the biggest challenges European start-ups are facing today is growth – more specifically, managing growth. From marketing to sales, young European companies are woefully unequipped to handle the rapid growth that’s needed to solidify their supremacy in any given industry."
Boris Bogaert, CEO Xpenditure
It’s true that European startups are struggling to find qualified managers who can take point and secure the rapid growth we’re seeing young start-ups achieve in the United States.
European universities are entrenched in the ‘Old Ways’ – getting students to cram theoretical stuff that, for the most part, cannot be applied in today’s evolved business setting. This is hardly fertile ground for cutting-edge, out-of-the-box managers to emerge from and more and more European countries are shopping for talent elsewhere in the world.
However, this isn’t the only challenge the European start-up community is facing. Boris can name 5 more of the top of his head in under a minute – trust me, I’ve tested it.
That got me thinking: what do CEO’s of other start-up companies think about this particular issue. Are they all on board in thinking that attracting the right talent is the most difficult thing to do? Or do some of them find other challenges more jarring and harder to overcome?
Read on to find out!
9 European Start-Up CEO’s Speak Up On Biggest Business Challenges
"We need to build a stronger talent pool in technology and get better at retaining this talent in Europe given the global competition for talent these days."
Eric Wahlforss, Founder & CTO SoundCloud
"Cultural differences are something that needs to be managed. For us, the fact that every country has different travel habits proved to be a large challenge that we had to overcome to get our business of the ground. Legislative regulations are also something that needs to be considered – there is no ‘one size fits all’ approach when it comes to European markets."
Symen Jansma, CEO & Founder Travelbird
"Leadership with scaling experience is hard to find in Europe. Finding the right people who can take your business to a higher level is proving to be very difficult."
Louis Jonckheere, Co-founder & Co-CEO Showpad
"The biggest challenges for us have to do with networking and PR. As a European, it’s hard to build a strong, personal relationship with journalists and bloggers when you’re halfway across the world."
"Funding is the biggest problem for European start-ups. American investors are more willing to take a chance on a business and participate in several funding rounds. Despite the fact that we put up € 150,000 of our own money and that we have a fully-functional, strong marketplace built from scratch, it was still difficult for us to attract potential investors."
Carlos Oleaga, CEO & Founder Outify.me
"Europe is a deeply fragmented marketplace that offers a lot of opportunities. However, language barriers, legislative fragmentation, and cultural difference are proving to be fundamental issues that companies need to learn to cope with if they want to succeed."
Florian Prucker, Founder & Co-CEO Scalable Capital
"Market fragmentation is an issue, especially since most markets are at different maturity phases so it hard to come up with a singular plan of attack. The entire situation is only made worse by different, and often unclear, legislative approaches that stem from the fact that every country in the EU is free to come up with their own regulations."
Daniel Daboczy, CEO FundedByMe
"The talent war is on in Europe. Every start-up company is trying hard to attract the right people who would be able to reinvigorate teams and provide clear focus and direction. Money can be found, right strategies can be defined, but you can’t build the professionals you need out of clay."
Victor van Tol, Co-founder & CEO SnappCar
Dennis Klett, CEO Lodgify
Are you surprised with the answers here?
I wasn’t. Legislation, geography, funding, lack of talent, language barriers, and cultural differences – the whole mishmash of the convoluted European business scene is there. Incidentally, this is exactly what our CEO, Boris would tell you.
A Closer Look
Let’s take these objections apart for a moment and see which ones can be classified as true challenges and which ones are opportunities – opportunities that are going to make you work for it!
Funding is difficult. European investors are not keen on losing money and they care about metrics – a lot. If you’re trying to get funded, you better be able to show how and when you will get their money – and their profits – back to them.
Unlike their American counterparts, European investors won’t play it by the hunch. You either have the numbers or you don’t – that’s it. Unfortunately, a lot of great ideas don’t get a chance to get off the ground thanks to this system.
Language and Culture
Language and culture can be viewed as more of an opportunity than an actual challenge – although there are industries where they can prove to be serious constraints.
However, if you play it right, this language barrier allows you to slowly scale up your business, in increments – solidifying your position in one market before moving on to the next. From a purely marketing perspective, it forces business to get creative because not everything will work everywhere.
Geography and Legislation
This one is a biggie. Americans have it easy – they have one unified market that follows the same set of laws. It might be vast and difficult to conquer but at least everyone is using the same rulebook.
This is not the case in Europe. Every country is free to come up with their own rules and regulations. Unfortunately, most are not in sync so businesses have to invest a lot of time and money in making sure their products and services are totally aligned with local regulations before moving in on a market.
Lack of talent
Caution is the word that links all our problems together. Europeans –both businesses and other stakeholders such as investors – are slow in committing to something.
We’ll reluctantly fund startups, we’ll cautiously enter new markets, and we’ll take the time to prepare fully before we do anything.
In short, we’ll take the time to think before we leap. And that’s not a bad thing – most of the time.
Unfortunately, that’s rubbing off on our college graduates. In addition to universities being enclaves that rarely cooperate with the business world – like they do in the US through cooperative programs and mandatory participation -, our graduates are all looking for snug 9-5 jobs that offer little in terms of challenge and opportunities to learn.
That’s why we lack key business players who can facilitate the fast growth of start-up companies – people who can bring the desired experience and expertise to the table and help businesses achieve their goals faster and easier.