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Why the Startup environment in Silicon Valley is more fruitful than in the Netherlands

by Vivienne Schröder

At a pitch event I meet John “startup” Doe*. I am very biased to meet him after the pitches: That name sounds familiar. It sounds Dutch. We start talking, and I explain what I am doing in San Francisco. Before I know it Doe starts describing the difference between the Bay Area and the Netherlands. There are many more people interested to talk to Doe, so we schedule a meeting to talk again.

Doe left the Netherlands about 25 years ago. He is on multiple advisory boards, also for Dutch startups, which gives him a unique view on the situation. He works 7 days a week: Full time as CEO at his startup, and is on 2 or 3 supervisory board positions and on 8 advisory boards. ‘Work and private life flow seamlessly over in each other,’ he says. ‘I do this because I like it.’

A question I have been hearing many times since my arrival is: ‘Why does Silicon Valley work here, and not in [insert country name].’ Doe is in a perfect position to shed some light on why it works in Silicon Valley and not in the Netherlands.

‘It is the culture,’ he states, ‘The openness in the communication, the whole ecosystem.’ In the Netherlands it is often about status, ego and formal procedures. The people in Europe do not think big enough. Besides that the whole corporate culture does not work like how it works here. It is difficult to give shares to employees, and there are other legal procedures that make the startup culture in the Netherlands less viable.

‘There is the saying: Penny wise, pound foolish. That is European behaviour, when talking about startups. People hold back information, or they do not think big enough.’ He then gives the example of how little series A are being funded in the Netherlands: Only 10. ‘That shows already how amateurish the startup sector is.’ Often in the Netherlands startups make mistakes from the start: They sign up as a BV (private company, ed.), which makes giving out stock option difficult, and the corporate governance is just bad.

The second thing is that here in the Bay Area people go all the way: They quit their job, they move to the area where they have to be, they work long hours: 40 hours a week is definitely not enough. ‘Dutch people are happy with a certain result, which is just not enough here in Silicon Valley.’ Doe explains that there are exceptions. ‘I’ve been to many places. I would dare to say that Europe almost is a lost case concerning tech startups, compared to Silicon Valley and China.’ He gives a few examples that did succeed, however he does then explain that they could have grown even more, if they would have been in the Silicon Valley culture.

And the third big reason why the Netherlands (and Europe) are not like Silicon Valley is because of capital. ‘The capital is here. And to get the capital you have to accept that there are blind spots in the business, thus less ego. The arrogance of Europeans does not work.’ In the Netherlands people succeed in something, and then they believe they are on top of the world. They have big stories and are no longer open for feedback. ‘In Silicon Valley, it is: If you can’t deliver the goods, it is game over.’

Doe has two children. One is still in high school, the other one just started at Stanford. As he said before he combines work and private life, he often takes his family on business trips. ‘I don’t feel more rested if I don’t work for a day, or a weekend, or a week.’ He works every day at least a little bit: Checking some emails etc. He would feel more stressed if he would not check in with work, than if he would take some time off. He sports six times a week, reads a lot of biographies, and spends time with his family. Normally he wakes up around 7 am, checks his email, has a few phone calls, and then has his first meeting around 9 am, until 10 pm. Somewhere in between he will sport – and eat, three times a day.

I ask him about his opinion on burnout culture. ‘It is extremely competitive. Creative destruction,’ he says. The quality of life is on average lower than in the Netherlands. Healthcare, educations, rent, it is all much more difficult and more expensive in the Bay Area. Doe himself has not been close to a burnout. I ask him what he does to prevent that. ‘You need to do what you like. That is why I don’t mind working that much.’

And the place makes him very happy. In the Netherlands, or Europe, you cannot just meet everybody. ‘Everybody here is willing to sit with you, and share knowledge.’ It is easy to get a coffee with people in high positions, something that would be difficult to arrange in Europe. And even if you would be able to arrange it in Europe, it will take a lot of time, while here everything goes much faster.

Earning money is still a ‘dirty’ word in the Netherlands. ‘Why would you work so much, if it would not improve your financial situation?’ Doe says, ‘If you deny that you want to improve your financial situation, I would not believe it. Especially the people in startups here in America, because there is no social security. Without a job you don’t have healthcare and all.’

The biggest difference between big companies and startups is the goals for the individual employee. At a big company people’s goal is to keep their seat warm, in startups they are focussed on results. In job interviews Doe asks the question: ‘Where does your motivation come from?’ Talking about those topics, he makes sure that he finds people who do not just keep their seat warm at his company. ‘You need to be able to handle the stress and speed, and you shouldn’t be scared to make mistakes.’ The culture in for example Germany and Japan is extreme risk avoiding, that is why the startup culture will not take off.

Before we end the conversation Doe shares an important startup culture quote from Jack Welch: ‘The biggest dirty little secret in business is: candor. It is all about trust.’

Vivienne Schröder is a master student Anthropology. She has done three months of fieldwork in San Francisco, where she did research on Tech Startups.

This essay was first published on Vivienne Schröder’s fieldwork blog.

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