Europe is home to some of the world’s most brilliant minds, world-class universities, and a rich history of scientific and technological breakthroughs.
Trying to replicate Silicon Valley is kind of a fool’s errand. Why? Turn the clock back sixty years. Would you like to live in what is now Silicon Valley? Weather? Not terribly challenging. Pretty? Well, yeah. Mountains? Yup. Beaches? Uh-huh. And before it became the present with all that entails (traffic, off-the-chart housing costs, all that) it was the *future* — it was the place where a postwar generation was going to do something *new* dammit!
Of course the vibe has darkened with the specter of a shift in the nature of success, but the allure remains.
The US can’t replicate that series of attributes. It’s been done. Pick a nice spot and folks are already there. Future hubs will be different. In fact one of the things we continually ignore is that one of the necessities of a future hub is the opportunity to fail. For things to not go as planned. That garage where the magic happens is not so interesting when it costs ten grand a month.
But if the US suffers from “nah, that neat place is already occupied”, in Europe you have to add on the phrase “for many hundreds of years”. So it would have to be a different model from the start.
I wonder how much of that culture finds its way into long-established companies shifting to new tech or business plans instead of the creative destruction that takes place in the US?
Nokia being a prime example. NOK has been around for over 100 years. It started as a paper mill, moved into rubber and cable, then into electronics. In the 1970s they began building telephone switchgear and radiotelephones, combining them in the 1980s and 90s with cellphones. Anyone hoping to be the next Nokia better be willing to deal with a company that's got its roots deep and wide. And the fact that most people, once employed by Nokia, probably aren't going to storm out after a bad day and start their own competing companies either.
Compare this to the evolution of the transistor. Invented at Bell Labs, first mass produced at Shockley Semiconductor. Managers at Shockley got tired of dealing with their (allegedly) psychopathic CEO and became "the Traitorous Eight," getting backing from Sherman Fairchild to start Fairchild semi. A few managers from Fairchild went on to be founders of a little startup called Intel.
The big problem with Silicon Valley these days is the institutional momentum is slowing. Once a company has been around for a generation it becomes an institute. Once enough pension and 401(k) mutual funds hold a stock it gets harder and harder to compete, for lots of reasons.
And why would you leave if you're an engineer who's getting a lot of benefit from working for Intel, unless you're getting recruited by Apple?
That’s a fantastic observation, and it highlights a fundamental difference between how legacy companies evolve in Europe versus the U.S. Nokia is a perfect example of long-term adaptability, but its evolution happened within the structure of a dominant, deeply rooted institution—whereas Silicon Valley’s success was largely fueled by exodus-driven innovation.
The “Traitorous Eight” story is the perfect contrast. Fairchild Semiconductor didn’t just birth Intel—it catalyzed an entire ecosystem of spinouts that led to AMD, National Semiconductor, and eventually the broader Valley we know today. That culture of leaving to start something better is a key ingredient in the Valley’s ongoing renewal, whereas in Europe, strong incumbents tend to retain talent rather than encourage entrepreneurial offshoots.
The challenge, as you point out, is that even Silicon Valley isn’t immune to institutional inertia. Once companies get big enough to be major 401(k) holdings, risk tolerance drops, bureaucracy grows, and creative destruction slows. The question for Europe is: Can it build a startup ecosystem that embraces disruption while balancing its legacy of deep institutional strength? That might require more than just better startup policies—it might mean a cultural shift toward rewarding entrepreneurial risk inside and outside of large corporations.
Would love to hear your take—do you think corporate spinouts and talent mobility could be the missing piece in Europe’s startup landscape?
I firmly believe that as China's bloom fades the next "workshop of the world" will be Eastern Europe. NATO/EU/US will figure out some sort of resolution to Ukrainian war, likely opening up new pipeline routes to get Russian energy flowing again. Ukraine will become a global hub for autonomous vehicles, leveraging their lessons learned fighting a "guerrilla drone" war with COTS equipment.
For decades Eastern Europeans have been migrating westward for opportunities in service industries. Their children were taught in western style schools and have skills necessary to be competitive. I could see where (for example) a child of Polish immigrants, who is fluent in the languages, could easily move back to "the old country" and work at a startup. The EU will benefit greatly from this move, allowing the industry in the west to continue to build big and control the regulatory environment.
I'm basing a lot of this thesis on German unification, where the west came in after the fall of the USSR and found a lot of cheap labor, cheap land and opportunity to expand. The satellite states behind the Iron Curtain certainly have benefited in a similar way, but now I believe they have the infrastructure in place, without the legacy, to aggressively build their own way.
For sure, future hubs will be different, they need to be, that's part of my point. Still, there are characteristics of how things work there, that can be replicated, and we can look at why it works the way it does, and guide cities/countries in that direction.
I partly disagree with your first point, mostly for reasons other comments have already pointed out. But I totally agree with your second. EU funds are a different kind of nightmare and, on the other hand, European investors, angels and VCs alike, are VERY conservative. My point being, if you're like me and want to become an entrepreneur, have the skills, a small team, an early product and some traction, but was born + reside in one of the so-called "lesser" EU countries like Romania, you essentially have little to no chance of getting any kind of funding other than EU funds, at least at seed stage. So you're more or less doomed to fail even before you begin. I can't even imagine the situation in European but non-EU countries.
Here in New Zealand, we don't want to be the next Silicon Valley, we want to be the next New Zealand. Have you been to the San Francisco Bay Area recently? They may be generating lots of wealth and cool stuff, but it comes at a very high social cost. Wealth is concentrated in the hands of a few. People are used up by Big Tech and then discarded. Social ills abound. And the tech itself is largely self-serving. They can keep it. Europe, you're amazing, and have been for centuries. Don't lose that. Focus on being the next Europe, not the next Silicon Valley.
That’s a compelling perspective, and I completely agree—no one should be trying to become Silicon Valley. Every region has its own unique strengths, values, and economic priorities, and the goal should be to develop a model that works for its people, not just chase wealth creation at all costs.
That said, the challenge isn't rejecting Silicon Valley’s model—it’s learning from it while avoiding its pitfalls. The concentration of wealth, social inequalities, and hyper-competitive work culture in the Bay Area are real issues. But at its core, what Silicon Valley does offer is a system that allows ambitious ideas to scale globally. The question for New Zealand, Europe, or any aspiring startup hub isn’t "Should we copy Silicon Valley?" but rather, "How do we build an innovation ecosystem that supports prosperity, inclusivity, and long-term sustainability?"
New Zealand, for example, has a strong foundation in sustainability, agritech, and biotech. What if it positioned itself as the global hub for regenerative industries? Europe, with its deep cultural heritage and focus on ethical business practices, could lead the way in human-centered AI or privacy-first technology.
The next step isn’t about rejecting what’s worked elsewhere—it’s about deliberately designing a system that creates innovation while reinforcing the social and economic values that matter most. What do you think that could look like in practice for New Zealand? Would love to hear your thoughts!
An important cultural difference in Europe vs. SV, and SV vs. most of the U.S., is a comfort with change (innovation) and risk-taking. For Europe, that is harder to change than getting the 'ecosystem components' in place, as we've seen across the U.S.
Trying to replicate Silicon Valley is kind of a fool’s errand. Why? Turn the clock back sixty years. Would you like to live in what is now Silicon Valley? Weather? Not terribly challenging. Pretty? Well, yeah. Mountains? Yup. Beaches? Uh-huh. And before it became the present with all that entails (traffic, off-the-chart housing costs, all that) it was the *future* — it was the place where a postwar generation was going to do something *new* dammit!
Of course the vibe has darkened with the specter of a shift in the nature of success, but the allure remains.
The US can’t replicate that series of attributes. It’s been done. Pick a nice spot and folks are already there. Future hubs will be different. In fact one of the things we continually ignore is that one of the necessities of a future hub is the opportunity to fail. For things to not go as planned. That garage where the magic happens is not so interesting when it costs ten grand a month.
But if the US suffers from “nah, that neat place is already occupied”, in Europe you have to add on the phrase “for many hundreds of years”. So it would have to be a different model from the start.
I wonder how much of that culture finds its way into long-established companies shifting to new tech or business plans instead of the creative destruction that takes place in the US?
Nokia being a prime example. NOK has been around for over 100 years. It started as a paper mill, moved into rubber and cable, then into electronics. In the 1970s they began building telephone switchgear and radiotelephones, combining them in the 1980s and 90s with cellphones. Anyone hoping to be the next Nokia better be willing to deal with a company that's got its roots deep and wide. And the fact that most people, once employed by Nokia, probably aren't going to storm out after a bad day and start their own competing companies either.
Compare this to the evolution of the transistor. Invented at Bell Labs, first mass produced at Shockley Semiconductor. Managers at Shockley got tired of dealing with their (allegedly) psychopathic CEO and became "the Traitorous Eight," getting backing from Sherman Fairchild to start Fairchild semi. A few managers from Fairchild went on to be founders of a little startup called Intel.
The big problem with Silicon Valley these days is the institutional momentum is slowing. Once a company has been around for a generation it becomes an institute. Once enough pension and 401(k) mutual funds hold a stock it gets harder and harder to compete, for lots of reasons.
And why would you leave if you're an engineer who's getting a lot of benefit from working for Intel, unless you're getting recruited by Apple?
That’s a fantastic observation, and it highlights a fundamental difference between how legacy companies evolve in Europe versus the U.S. Nokia is a perfect example of long-term adaptability, but its evolution happened within the structure of a dominant, deeply rooted institution—whereas Silicon Valley’s success was largely fueled by exodus-driven innovation.
The “Traitorous Eight” story is the perfect contrast. Fairchild Semiconductor didn’t just birth Intel—it catalyzed an entire ecosystem of spinouts that led to AMD, National Semiconductor, and eventually the broader Valley we know today. That culture of leaving to start something better is a key ingredient in the Valley’s ongoing renewal, whereas in Europe, strong incumbents tend to retain talent rather than encourage entrepreneurial offshoots.
The challenge, as you point out, is that even Silicon Valley isn’t immune to institutional inertia. Once companies get big enough to be major 401(k) holdings, risk tolerance drops, bureaucracy grows, and creative destruction slows. The question for Europe is: Can it build a startup ecosystem that embraces disruption while balancing its legacy of deep institutional strength? That might require more than just better startup policies—it might mean a cultural shift toward rewarding entrepreneurial risk inside and outside of large corporations.
Would love to hear your take—do you think corporate spinouts and talent mobility could be the missing piece in Europe’s startup landscape?
I firmly believe that as China's bloom fades the next "workshop of the world" will be Eastern Europe. NATO/EU/US will figure out some sort of resolution to Ukrainian war, likely opening up new pipeline routes to get Russian energy flowing again. Ukraine will become a global hub for autonomous vehicles, leveraging their lessons learned fighting a "guerrilla drone" war with COTS equipment.
For decades Eastern Europeans have been migrating westward for opportunities in service industries. Their children were taught in western style schools and have skills necessary to be competitive. I could see where (for example) a child of Polish immigrants, who is fluent in the languages, could easily move back to "the old country" and work at a startup. The EU will benefit greatly from this move, allowing the industry in the west to continue to build big and control the regulatory environment.
I'm basing a lot of this thesis on German unification, where the west came in after the fall of the USSR and found a lot of cheap labor, cheap land and opportunity to expand. The satellite states behind the Iron Curtain certainly have benefited in a similar way, but now I believe they have the infrastructure in place, without the legacy, to aggressively build their own way.
I've been exploring the same thought and want to put more time in
You might appreciate my simple take on Estonia: https://paulobrien.substack.com/p/from-socialist-roots-to-a-free-market
Or my more extensive about Croatia: https://paulobrien.substack.com/p/zagreb-plus-istria-the-economic-development
For sure, future hubs will be different, they need to be, that's part of my point. Still, there are characteristics of how things work there, that can be replicated, and we can look at why it works the way it does, and guide cities/countries in that direction.
I partly disagree with your first point, mostly for reasons other comments have already pointed out. But I totally agree with your second. EU funds are a different kind of nightmare and, on the other hand, European investors, angels and VCs alike, are VERY conservative. My point being, if you're like me and want to become an entrepreneur, have the skills, a small team, an early product and some traction, but was born + reside in one of the so-called "lesser" EU countries like Romania, you essentially have little to no chance of getting any kind of funding other than EU funds, at least at seed stage. So you're more or less doomed to fail even before you begin. I can't even imagine the situation in European but non-EU countries.
What do you think could be done to change that Cat?
Here in New Zealand, we don't want to be the next Silicon Valley, we want to be the next New Zealand. Have you been to the San Francisco Bay Area recently? They may be generating lots of wealth and cool stuff, but it comes at a very high social cost. Wealth is concentrated in the hands of a few. People are used up by Big Tech and then discarded. Social ills abound. And the tech itself is largely self-serving. They can keep it. Europe, you're amazing, and have been for centuries. Don't lose that. Focus on being the next Europe, not the next Silicon Valley.
That’s a compelling perspective, and I completely agree—no one should be trying to become Silicon Valley. Every region has its own unique strengths, values, and economic priorities, and the goal should be to develop a model that works for its people, not just chase wealth creation at all costs.
That said, the challenge isn't rejecting Silicon Valley’s model—it’s learning from it while avoiding its pitfalls. The concentration of wealth, social inequalities, and hyper-competitive work culture in the Bay Area are real issues. But at its core, what Silicon Valley does offer is a system that allows ambitious ideas to scale globally. The question for New Zealand, Europe, or any aspiring startup hub isn’t "Should we copy Silicon Valley?" but rather, "How do we build an innovation ecosystem that supports prosperity, inclusivity, and long-term sustainability?"
New Zealand, for example, has a strong foundation in sustainability, agritech, and biotech. What if it positioned itself as the global hub for regenerative industries? Europe, with its deep cultural heritage and focus on ethical business practices, could lead the way in human-centered AI or privacy-first technology.
The next step isn’t about rejecting what’s worked elsewhere—it’s about deliberately designing a system that creates innovation while reinforcing the social and economic values that matter most. What do you think that could look like in practice for New Zealand? Would love to hear your thoughts!
An important cultural difference in Europe vs. SV, and SV vs. most of the U.S., is a comfort with change (innovation) and risk-taking. For Europe, that is harder to change than getting the 'ecosystem components' in place, as we've seen across the U.S.