Europe is losing talent as early as the first career decision after college.
I live in Aachen. The city is home to RWTH, an excellent technical university with strengths in engineering, robotics, and deep tech. The university and the local ecosystem are doing a lot to foster more spin-offs and retain talent in the region.
Nevertheless, two months ago at a festival, during conversations with students, the same question kept coming up: What happens after graduation? Those who don’t start their own start-ups or join small local startups will have struggles finding a local employers working on globally relevant AI, robotics, or deep tech.
Europe can fund research, train international talent, and foster early-stage startups. It is much more difficult to build a functioning startup ecosystem around our excellent universities. A university can create a talent pipeline; however, it cannot single-handedly create a scale-up economy.
The answer should not be to prevent mobility or to promise digital self-sufficiency. But Europe needs more places where research can turn into a startup, a startup into a scale-up, and a scale-up into a globally significant employer.
Munich demonstrates through TUM how universities can become anchors for an entire technology ecosystem. Research, startup creation, capital, and industry are not treated as separate worlds, but rather as a shared infrastructure for long-term business development.
The deeper problem may not be whether Europe can produce another large technology company, but whether it can control the layers through which technological power is converted into strategic power. Capital and regulation explain why firms struggle to scale; they do not fully explain why Europe can possess world-class assets such as ASML while still depending on foreign cloud, AI, payments, platforms and connectivity. A technology sector becomes strategically sovereign when its components reinforce one another as an ecosystem. Otherwise Europe may succeed in building excellent pieces while someone else continues to own the control plane.
Just building on the point regarding Swedish investments; it has a very strong retail investment scene which helps boost the liquidity for start-ups since the general population is much less risk-averse compared to other EU countries (only about 10% of household wealth is held in cash). This is largely due to tax-favorable investment accounts (Investeringssparkonto or ISK) which incentivize folks to take on more risk for higher returns vs. traditionally taxed accounts.
The capital gap is correctly identified but the causality runs deeper than risk appetite. US VCs invest aggressively because the US market provides IPO and acquisition exits at scale. European VCs are conservative because European exit multiples are structurally lower. Smaller public markets, fewer large acquirers, fragmented domestic market. The expected return on European VC is lower not because the companies are worse but because the terminal value is smaller.
So the capital follows the exits, not the other way around. You can't fix the capital gap without fixing the exit gap. You can't fix the exit gap without the deep capital markets that the capital gap prevents you from building. That circularity is what Draghi identified and what EU Inc. is attempting to break. Whether a corporate registration reform can solve a capital markets problem is the real question, and history suggests it can't on its own. Estonia and Sweden succeeded not because they simplified registration but because they created ecosystems where exits actually happened and the proceeds recycled locally.
Europe is losing talent as early as the first career decision after college.
I live in Aachen. The city is home to RWTH, an excellent technical university with strengths in engineering, robotics, and deep tech. The university and the local ecosystem are doing a lot to foster more spin-offs and retain talent in the region.
Nevertheless, two months ago at a festival, during conversations with students, the same question kept coming up: What happens after graduation? Those who don’t start their own start-ups or join small local startups will have struggles finding a local employers working on globally relevant AI, robotics, or deep tech.
Europe can fund research, train international talent, and foster early-stage startups. It is much more difficult to build a functioning startup ecosystem around our excellent universities. A university can create a talent pipeline; however, it cannot single-handedly create a scale-up economy.
The answer should not be to prevent mobility or to promise digital self-sufficiency. But Europe needs more places where research can turn into a startup, a startup into a scale-up, and a scale-up into a globally significant employer.
Munich demonstrates through TUM how universities can become anchors for an entire technology ecosystem. Research, startup creation, capital, and industry are not treated as separate worlds, but rather as a shared infrastructure for long-term business development.
The deeper problem may not be whether Europe can produce another large technology company, but whether it can control the layers through which technological power is converted into strategic power. Capital and regulation explain why firms struggle to scale; they do not fully explain why Europe can possess world-class assets such as ASML while still depending on foreign cloud, AI, payments, platforms and connectivity. A technology sector becomes strategically sovereign when its components reinforce one another as an ecosystem. Otherwise Europe may succeed in building excellent pieces while someone else continues to own the control plane.
What happens to a pensioner’s life savings when “money” becomes a permission slip instead of a possession?
https://nromanov.substack.com/p/what-will-happen-to-pensioners-over?r=8isc4s&utm_medium=ios
Just building on the point regarding Swedish investments; it has a very strong retail investment scene which helps boost the liquidity for start-ups since the general population is much less risk-averse compared to other EU countries (only about 10% of household wealth is held in cash). This is largely due to tax-favorable investment accounts (Investeringssparkonto or ISK) which incentivize folks to take on more risk for higher returns vs. traditionally taxed accounts.
The capital gap is correctly identified but the causality runs deeper than risk appetite. US VCs invest aggressively because the US market provides IPO and acquisition exits at scale. European VCs are conservative because European exit multiples are structurally lower. Smaller public markets, fewer large acquirers, fragmented domestic market. The expected return on European VC is lower not because the companies are worse but because the terminal value is smaller.
So the capital follows the exits, not the other way around. You can't fix the capital gap without fixing the exit gap. You can't fix the exit gap without the deep capital markets that the capital gap prevents you from building. That circularity is what Draghi identified and what EU Inc. is attempting to break. Whether a corporate registration reform can solve a capital markets problem is the real question, and history suggests it can't on its own. Estonia and Sweden succeeded not because they simplified registration but because they created ecosystems where exits actually happened and the proceeds recycled locally.