Europe's Startup Value Is Being Stolen — Here's How to Stop It

Jan de Vries · 2026-09-19

Imagine building something brilliant in Europe, only to watch someone else cash in on it. That's the frustrating reality Jonathan Symonds, chairman of HSBC UK, recently pointed out: European businesses create enormous value, but others capture it. It's a cycle that's been running for decades, and it's time to break it. ### The Leaky Bucket of European Innovation Europe has no shortage of smart people and great ideas. From fintech in London to green tech in Berlin, startups sprout up everywhere. But when they start scaling, many hit a wall. They can't find the late-stage capital they need at home, so they look to the US. That's where the value gets captured. - **Funding gap:** European startups raise seed rounds easily but struggle with Series B and beyond. - **Talent drain:** Engineers and founders often move to Silicon Valley for bigger paychecks and better opportunities. - **Exit strategy:** Many European startups end up selling to American or Asian giants, losing their independence and local impact. It's like growing a prize-winning tomato in your garden, then letting your neighbor sell it at the farmers market. You did the work, they get the profit. ### Why This Keeps Happening Symonds argues that Europe's fragmented market is a big part of the problem. Each country has its own rules, tax systems, and cultural norms. Scaling across borders is a headache. In the US, you can sell to 50 states with relative ease. In Europe, you're dealing with 27 different sets of regulations. > "European business creates value, others capture it – it's time to break this cycle." — Jonathan Symonds That fragmentation makes it harder for European companies to grow big enough to attract large investors. And when they do grow, they often get acquired before they can become the next Google or Apple. ### The EU Inc Proposal: A Game-Changer? There's a new idea floating around called the EU Inc proposal. The goal is to create a single, unified corporate structure across the EU. Think of it as a Delaware for Europe — a legal form that works in every member state. This could make it much easier for startups to scale, raise capital, and stay European. Here's what it could do: - **Simplify cross-border operations:** One set of rules, one tax framework, one stock option plan. - **Attract global investors:** A familiar, standardized structure would make European startups more investable. - **Keep value in Europe:** Founders could grow their companies without feeling forced to move to the US. But it's not a magic bullet. The proposal still needs approval from all EU member states, and that's a tall order. Some countries might resist giving up control over their corporate laws. ### What This Means for US Professionals If you're an American investor, entrepreneur, or business leader, this matters to you too. A stronger, more unified European startup ecosystem means more competition and more opportunities. It could also mean more European companies staying independent and expanding into the US market on their own terms. For US investors, the EU Inc proposal could open up a whole new asset class: European startups that are easier to invest in and scale. That's a big deal. ### Breaking the Cycle: What Needs to Happen Symonds isn't just complaining; he's calling for action. Here's what he and others suggest: - **Create a unified market:** The EU Inc proposal is a step in the right direction. - **Boost late-stage funding:** Europe needs more growth-stage venture capital and private equity. - **Encourage risk-taking:** Cultural attitudes toward failure need to shift. In the US, failure is a badge of honor; in Europe, it's often a stigma. - **Retain talent:** Better incentives, like stock options that aren't taxed into oblivion, can keep founders and engineers in Europe. ### The Bottom Line Europe has all the ingredients for startup success: talent, ideas, and capital. But the recipe is missing a key step: keeping the value at home. The EU Inc proposal could be the missing piece, but it's going to take political will and a cultural shift. For now, the cycle continues. But if Symonds and others have their way, the next generation of European startups won't have to watch someone else profit from their hard work. And that's a future worth fighting for.