Essay
Why is Europe Failing To Create More Unicorns?
Out of 108 startups with a valuation of more than
one billion dollars, 78 are from the US and only nine are from Europe. Whats going on?
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Before you read on: This is a complex issue and I don’t claim to have the answers. In fact it’s going to ask more questions than it answers and I wasn’t even sure I wanted to publish it. It’s not even obvious why chasing unicorns is such a good idea. Now they are here though, lets at least have a look at why Europe has so few. Agree, disagree have some observations of your own? Please share them in the comment section.
It’s hard to to build a business no matter where in the world you do it; most businesses fail. So the entire premise for a healthy economy is that new companies consistently gets created. Over the last 10-15 years, a new type of company have emerged called Unicorns. These are companies on the private market that are valued at more than $1 billion and are primarily found in the tech industry. These are companies like Airbnb, Dropbox, Uber, Spotify and Square and data from some research WSJ and Down Junes VentureSource did, show that a surprisingly small number of them are European. Out of 108 Unicorns only 9 of them are from Europe. Why aren’t there more?
On of the explanations I hear a lot is that Americans are just better entrepreneurs and that they think bigger. I don’t believe this is true — In fact, after having spent more than 15 years working with both European and US startups, I have yet to meet a European founder who doesn’t aspire to become as big as their US counterparts. Yet somehow European startups just aren’t producing these fast growing companies.
According to Forbes, 40% of the fortune 500 companies in the US are started by foreigners and 60% of popular tech companies are started by 1st or 2nd generation immigrants, many of them Europeans. In other words The US is often relying on foreigners to innovate and create those businesses and plenty of Europeans are amongst those who succeed.
The other reason I hear a lot is that it’s a matter of access to capital and that European VCs are more risk averse. This might be the case but it doesn’t explain why american VCs aren’t just taking over and investing in the startups. In other words it doesn’t explain why the VCs are risk averse, which is really the question to ask.
The third reason I hear is that the US market is bigger and therefore it’s easier to get traction. Yet there are 503 million Europeans living inside the EU vs. 319 million US living in the US. If the size of the market was any indication of how many unicorns a market could create, Europe would be in the lead. So size of the market alone isn’t an explanation either at least not by comparing the numbers.
What is the European market?
A problem with defining Europe or the European Union as one market is that it really isn’t; it’s many markets. The EU and the EUR was established to make it easier for these markets to work together through harmonizing legislation and create an inner market. The reality however is, that this is going to take years.
On top of that, these different markets speak different languages. 23 official languages and 60 indigenous regional and minority languages. So even if the laws were unified, there would still be language and cultural barriers for any entrepreneur who dreamt of expanding to all of Europe.
This might definitely be a key component for why it’s hard to scale businesses in Europe beyond $1 billion+ valuations. But it leaves one important question to unanswered…
How do we explain that Europe historically have had no issues creating what in their time, might have been called unicorns?
There are 160 European companies on the Global Fortune 500 list vs. 132 US companies. These are of course mostly older companies and not part of the Unicorn category, but at the end of the day that’s just semantics. The fact remains, Europe has historically created some of the biggest companies back when there was no harmonization. Before there was even an idea of a single market that the EU today is trying to establish.
How can that be? How come, Europe has historically spawned many global players, yet today apparently fail to establish anywhere near as many as their US colleagues. How come European companies are failing to innovate and establish these unicorns despite the EU working hard to harmonize the market which should make it easier to expand?
Perhaps the question isn’t whats wrong with the startups or the more risk averse European investors but whats wrong with Europe. Why are investors risk averse? If it was just a matter of a different mindset then why haven’t American investors just swept the market and started investing in promising startups?
Observation #1
Disconnect between the needs of the European politicians and those of European startups.
In order for EU to unify under a single market, the member states need to agree on the laws so they can get implemented nationally. That way, a French entrepreneur can establish a business across Europe and know that the rules which apply to the company in France will also apply to it in Spain, Germany, UK etc.
But with so many nations involved and all having to agree, it also means a lot of legislation that a specific country might have had because of some issues specific to that country, suddenly gets applied to all of the other Member states. In other words harmonization is not just adjust existing laws it’s adding a lot of new laws.
There are rules for the curve of the cucumber to the bendiness of bananas. Recently large vacuum cleaners and incandescent light bulbs were banned. There is now also a proposal to ban halogen light. Recently the EU was looking into banning cinnamon used in cinnamon rolls because of a too high amount of coumarin, known to be causing liver damage if consumed too extensively. There are rules about having to put a big fat disclaimer on your website and have the user approve the use of cookies. The EU creates a lot of new rules and the member states are mostly forced to adopt them.
The need for the European politicians to continuously implement new legislation to harmonize the inner market creates a problematic environment for business innovation to happen within. Once a directive have been agreed upon in the council, an enormous pressure is put on the nation states to implement it; killing any attempt to try and challenge this from the smaller players in the private sector.
Startups often benefit from change coming from the bottom up, but change created by politicians comes from the top and thats rarely beneficial.
Observation #2
Europe has no Silicon Valley or New York.
It might not sound like a big deal but it is. New York and Silicon Valley are centers of concentrated knowledge, money, experience and talent, which it can apply to almost any problem. Their ecosystems have been developing over decades now and ensures both constant influx of new talent from all over the world plus an alumni of experienced investors, entrepreneurs, lawyers and lobbyist ready to help navigating the many obstacles of building businesses.
The Europa has none of that. If a city has the culture, it doesn’t have the money. If it has the money it doesn’t have the culture. There is no repository of knowledge no central hub of alumni. No fostering of new talent to go out there and build the next billion dollar company. When someone finally do, there is very few people who can help them take the company from a small company into a mid-sized one let alone a large global company.
Furthermore most EU legislation made to help the private sector, is focused primarily around the old industries. Those who have the money and power to lobby for their interests. Because the European startup scene is spread out so thinly, it’s hard to effectively educate politicians about the needs of the small beginning companies.
There are contenders like Berlin, London and Stockholm, but they all lack the full stack entrepreneurial ecosystem and access to funding.
Observation #3
European startups ask for permission instead of forgiveness.
The truth is that in order for a company to truly innovate it has to break convention and sometimes go to the edge of what is legal and deemed acceptable. If you look at some of the US companies that are doing well like Uber, Airbnb, Kickstarter, LendingClub and Tesla; they are all fighting legal battles both with incumbents and states.
For many Europeans this approach is seen as bad business behavior and so it’s very hard for any startup to gather any kind of moral, financial or legal support to fight these fights. The result is that Europeans too often end up creating predictable businesses within the confines of what the law allow them to do. Instead of fighting the regulation they end up obeying them. This might make for a good medium sized company, but rarely does it create truly groundbreaking giants.
Observation #4
The EU seems to be fixing the problems that the startups could fix.
Any society who want to have a healthy public-private julietta online casino relationship, need to establish some ground rules that benefit both parts. Europe seems less inclined to try and solve it’s issues by trusting it’s civil societies. Perhaps it’s just an ingrained mistrust to the private sector in general and perhaps thats why unions, although they have lost a lot of power, are still very powerful. Maybe it’s the said harmonization process thats creating this environment. Startups are normally very good at solving problems that emerge as society progress, but when they come as legislation it rarely benefits startups but rather the incumbents.
So why is Europe failing to produce Unicorns at the same pace as the US again?
As always with everything as widely defined as this question there are no simple answers. I believe that a combination of the continuing harmonization process and lack of a proper entrepreneurial power center are the biggest factors. The claim — that it’s because of of different cultures, has some validity, but not as much as we Europeans would like to tell ourselves. As I hope to have shown, we didn’t use to have this problem back when the markets where even more fragmented and we do just fine when we start companies in the US.
The irony might be that in the process of harmonizing Europe’s markets we are making it harder for European startups and investors because the harmonization process in itself is disrupting Europe making it harder to establish these power centers. Maybe it was easier when you could take it country by country, hire locals representatives who knew the market well and thats why Europe used to produce more important companies. Maybe it’s just because Europe used to be a superpower and had the political power and the US now taken over.
All of the mentioned observations definitely play a role. But more importantly I believe that it also show us something interesting about progress and stability.
Any society who wants to prosper needs to find a balance between letting progress rule and holding progress back. Progress is always necessary, but all progress have consequences, there is just no two ways around that. Someone will always be affected negatively by it. As humans we love progress but we fear change and at it’s core — progress disrupts how things used to be and forces us to reconsider if they could be differently. Politicians know this and they know that in order for a society to function their primary job is always going to be to ease the affect of progress.
Unicorns might not be what Europe want and we might all agree it’s an unsustainable model. Even if it is though, many of these companies, will still be having a huge impact on societies all around the world. So Europe (and I know I have been using this very loosely and somehow inconsistently) might need to take a hard look at the price of their politically controlled progress and whether it is affecting europes ability to still spawn new successful companies.
The EU seems to be fixing a lot of it’s problems via legislation. The question, to me at least—still stands as to who are it’s benefitting. EU or the Europeans.
I totally agree with this post. In South Africa people ask why Africa’s second largest economy does not produce as many Unicorns as it did with major multi-national corporations.
I think the issue is 3 fold, and you have touched on some of these points.
1. The South African market is just not that large. The GDP of New York State is 4 times the GDP of South Africa, let alone GDP per capita figures.
2. Not enough talent, money, ideas, and diversity have converged in a hub in order to create ‘Black Swans’.
3. The building blocks of the information economy are still being built in South Africa. Meaning that the probability of building a multi-national corporation is higher than that of an information based startup
[…] important reason of many reasons why Europe for example is failing to create more unicorns at the same pace as the US […]
[…] important reason of many reasons why Europe for example is failing to create more unicorns at the same pace as the US […]
I believe this is very far from the truth.
The idea that Europe is somehow better quality is simply wrong. The only country that do really high quality manufactoring is Switzerland because they focused on technical education rather than academic for many years.
It’s simply misguided to think that China isn’t capable of producing at high quality. They are and they do, in fact they have developed new methods that could never have happened in Europe exactly because of the Unions and regulations.
Well, 100 years ago, you had no competition from outside of europe – distance did matter back then. Now shipping cost is so low, that price for human labour has the biggest impact on competitiveness. And as many countries in the world can produce cheaper, europe had to focus on quality products over quantity for the last 30 years. The thing is, europe isn’t lacking research and development, but rather companies outside of europe are lacking standards on sustainable and secure production.
The way to go would be, to facilitate workforce outside of europe to produce high quality products with same production standards but lower wages. Or just keep aiming for the cutting-edge and high revenue niche markets, where you won’t ever grow a unicorn unless you have a breakthrough discovery that puts you 10 years ahead of all competition.
Yes the language (and culture) barriers are relevant. But as I try to explore in the essay. Europe didn’t use to have this problem despite the even bigger language barriers. In fact there are more European Fortune 500 companies than US ones.
Also Rocket Internet is showing that focusing on localization is one way to expand quickly.
I agree with most of your points – but I think you’ve overlooked the biggest barrier in Europe; it’s the size of the individual markets and the huge cultural differences between them.
Let me explain with an example:
Say you’re the head of a startup in California. You’re product/service is successful here and you’re looking to expand. No problem. You can start doing business in Oregon right away. Maybe you’ll expand into Washington at the same time. Hell, why not jump right to the East Coast. You’ve probably got a little bit of bureaucracy to sort out, but you’ll just send some of your team over to set up. Maybe you’re able to keep most of your operations in California, and just have small teams out in the satellite states.
Now imagine the same situation in Germany. Your business and the market are of a similar size to that of the Californian example, and you also want to expand. Let’s go north! But wait, to the north is Denmark, a much smaller market (5 million people) and they also don’t happen to speak German! Instead the pesky locals insist on speaking a strange and foreign tongue called Danish! This means that you can’t just send your best Germans over to do business there. You need some native Danish speakers as well! In fact, large parts of your team there will have to speak Danish.
Not to worry, lets go west to France instead! Maybe we can find some French speakers and setup our business there!
But wait, French culture is very different, and our product isn’t doing so well. While the efficient and sensible Germans love our product, the French don’t care for it! We’ve spent time translating our product but we need to adapt it to suit a French audience as they are more concerned with drinking good wines and eating nice cheese than using products from our plucky German tech startup! It’ll take work, but with time we can double our market.
Here’s the thing though, to double your market in Europe takes far, far more effort than in the US. I realise there are cultural differences and markets across the US, but they are far smaller than the cultural differences in Europe. Doing business (or selling to customers) in Helsinki is so very different to Rome. Doing business in San Francisco is not so dissimilar to New York, 2000km away (that’s 1300 in freedom units).
The US may be a nation of states, but Europe is a continent of countries.
Yeah but that still goes back to the question as to why that is?
There are European unicorns, why haven’t they spawned a mafia of equal power and my guess would be because there is no SV or NY they can spread out in.
I.E. Most successes in Europe are isolated cases not the mafia tree as we see.
I think that one effect you are missing is the “exponential” effect — what unicorns do is go out and make more unicorns . The PayPal Mafia is the canonical example; they’ve gone on to found and/or fund a large number of unicorns. I don’t think there is a similar effect in Europe; it might be interesting to look at unicorn family trees.
Of course that doesn’t explain why EU has so few unicorns in the first place, but it might explain why the difference is so large, e.g. a 5x advantage in creating unicorns might result in a 10x advantage in the total number of unicorns…
But Europe successfully created very large high-tech companies long before the EU provided 70 years of military peace (mostly), much less even partially harmonized markets: Companies like Ericsson, Phillips, Nokia, Siemens, ABB, Bayer, and AstraZeneca are all >100 years old. They didn’t just deal with different markets and cultures – they grew despite WW2, WW1, the Franco-Prussian War…. In the US, pretty much only IBM and ATT are from that era.
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The number of tracked companies is highly relevant thats where we are disagreeing. It doesn’t matter if there was a X100000 more projects if they still don’t turn into companies they didn’t actually affect anything about this discussion.
Further more and even more proof why your theory is wrong. Less companies succeed not more. So I have a hard time seeing what you think you are gaining by trying turn projects into company territory.
The sad fact is. Less companies are created across industries, more companies fail across industries.
Here’s an example scenario:
Now: 100 “projects”. 95 fail fast, never incorporated. 4 have some kind of success and the founders incorporated once they realize they’re onto something. One unicorn, also incorporated once the founders realize they were onto something. The result is 5 companies being tracked.
Before: 100 “projects”, all of them incorporate because that’s what you had to do to even get a shot. 95 fail. 4 have some kind of success. One unicorn. Same outcome, but 100 companies that are tracked.
That’s why I’m saying that number of tracked companies is irrelevant and what really matters is the number of “projects” that people are starting. And I regarding a) I believe there are actually a lot more “projects” in SV than in Europe, at least for software companies. People seem to be discussing their projects in almost every coffee shop I go into. But of course arguing about this doesn’t make a lot of sense, since nobody can actually get those numbers ;)
But
1) there aren’t 10X more projects in SV
2) it wont mean bigger chance of unicorns unless they start a company and since there are less companies started than there used to be it means there is less chance of unicorn not more.
3) it’s across the industries.
But if there are 10x more “projects” in SV, there’s a proportionally higher chance that some of them will turn into unicorn companies. Even if there are the same number of companies in SV and Europe it may just be because SV founders tend to incorporate later (which kind of makes sense to me since Europe is a bit more conservative).
If Europe and SV had the same number of “projects” than I think it’d fair to conclude that something in the European environment is working against creating unicorns. But of course there are no statistics on that… just anecdotal evidence that I don’t see a lot of German working on projects ;)
Good point on non-tech though, I can’t really say anything about that.
I understand that and my point is that it’s always been like that.
But no matter what thats not really important because it’s only those companies who start a company that can build ex a Unicorn and the number of businesses is falling across industries also non-tech.
You cant test a business if you dont create a company.
I guess my point is that I think there are now many more people starting “projects” that could turn into startups, it’s just that they don’t count as startups in the official statistics because they’re not incorporated. When the Customer Development methodology and failing fast wasn’t common and creating software was difficult/expensive you would need to incorporate and invest from the very start in order to get something off the ground, and these “companies” (that are just like today’s project) would be counted. Now people choose to stay “under the radar” for longer, because well, there really is no reason to waste time or money until you can prove some amount of traction.
But it’s always been like that nothing new there. It’s never been so cheap to start a company yet less do. Thats whats troubling IMO.
I agree, but I think a lot of founders wait with incorporation until they really have to do it, i.e. when the business gets traction, they try to raise money, or they go into an incubator. We can call these non-incorporated startups “projects”, but I believe there is a huge amount of them in SV, and some of them will turn into quite successful startups. I wonder at what point in their lifetime Airbnb actually incorporated for example. Probably not when they rented out the first mattress.
If they haven’t created a company but is just a project they aren’t really a startup. The second they do it should be possible.
Here is one
http://www.inc.com/magazine/201505/leigh-buchanan/the-vanishing-startups-in-decline.html
That would be interesting. I just can’t imagine how the (I believe quite common) “startup” with little traction and made up of 1-2 people working out of coffee shops could be tracked.
No all types of startups not just venture backed companies. There are less done today than there used to be. I can try and find the numbers somewhere.
Yes thats one of the things I am saying to. But what struck me was that Europe before it was harmonized as much as it is, used to be able to create big companies all the time.
Thing is, there is no _europe_ technically speaking. It’s different markets with different culture, languages, currencies, legislation, etc.
It is way easier to start in a single big market like US, Brazil, China, India, Indonesia, Canada, than in any of the many european countries. Even though it is possible to grow strongly from Europe, it is easy for a US company to copy the model before it hits the US market and win the race even being one year late to the game.
Socialism often rewards failure. It does this by reallocating wealth to failing or failed parts of the social structure. It is not Christian or Sikh, or an implementation of Christian principle in many cases since stealing from people and production to help the poor is not the same as asking good people to help the poor out of logic and conscience. Sadly, the difference is often hateful, violent, massive, and parasitic.
Seems simple, divide usable and farmable land, minerals, machinable goods, energy, fuel, by number of people, Europe loses. Population and transportation gridlock are serious problems in Europe, not so much in parts of the US and even China, terrain being one feature. But another reason for chasing unicorns, you really don’t want them chasing you!!
That’s an interesting topic. I think the statistics on the number of startups created are a bit misleading. Intuitively it makes sense that there are a lot less venture-backed startups because starting a software company requires very little capital these days (and investors expect more validation than some time ago when you could raise money with just a deck). The vast majority of startups die before they ever raise any money and that isn’t reflected in any statistics.
The evidence is just anecdotal, but grewing in Germany (and regularly visiting) I find the startup scene in Berlin, which is supposed to be one of the biggest startup hubs in Europe, extremely tiny compared to SV. Most people have no idea what a startup even is. I wouldn’t be surprised if the bay area alone creates more startups than all of Europe.
Of course not, but I happen to do know what it means so no need to worry about that part :)
Well most of those fortune 500 EU companies are either petroleum / automotive / utility suppliers. I haven’t looked at every single one of them but there is very little “new economy tech” at least at the top in terms of EU companies. This trend of “old economy” businesses is coupled with the fact these businesses were started pre-internet… and probably much older than that, a good chunk of those companies are probably funded post WWII (when it was “easy” to start any kind of business in a climate of economic reprise) or even before. Obviously the environment back then was wildly different for a number of historical reasons and the EU was embryonic when most of these businesses emerged. So basically, I think that comparing new economy unicorns to these traditional economy giants is not as straightforward :)
I have studied at both US and German University and yes the european universities tend to be underfunded and not as shiny looking as the US ones. I personally enjoyed studying in the US a lot more, but since I mad my Bachelors in Germany I would not want to miss that, since the Methodology (mostly self study, no mandatory classes, rooms full of people, nobody cares about you, you have to make friends on your own, …) forces you to learn a lot more for yourself. Btw I once calculated it, there are more nobel price winners combined from all european countries than from the US ;)
Totally agree with 1 and 4!
2: there’s actually private school and hospitals in France & Sweden so innovation could start there!
3: Tend to agree but US was and still is very focused on consumption, they’re more inclined to buy stuff they don’t need. But do you need iOS when you have Android? :)
Europe today is less socialist than it used to be in the sense that it has mostly accepted capitalism. Of course Europe was a mixed bag. The point is that it’s less mixed today.
I think I know what socialism is so don’t worry about that, I am European myself :)
The bureaucracy comment is isolated from the political part. I am referring to the issues of conducting business internationally between the european countries before the process of harmonizing the rules.
I wish people would know what “socialism” means before using the term (wrongly).
Socialism has nothing to do with bureaucracy.
Socialism is about capital and chances for entrepreneurs and small business instead of capital for established conservative major players, banks or rich family risk takers.
[…] Source: Why is Europe Failing To Create More Unicorns? – Black&White™ […]
Your assumption about Europe’s history is wrong; the `socialism’ of modern Europe is a relatively recent (post-WW2) phenomena. Europe is a complex place, and my previous statement can be argued in some cases, but the Europe-of-old was a far more mixed environment, with greater concentrations of wealth, great depths of poverty and far, far less aversion to risk. Before the world wars Europe was well ahead of the US in many areas including aviation, weapons and marine industries.
There’s less hot air in Europe.
When you say historically – what do you mean? Do you mean before the US became a super power? Also try comparing it to the Universities. Have a walk around Stanford and you see what a mockery European universities are. How many Cambridge graduates have created a $1B startup?
[…] Source: Why is Europe Failing To Create More Unicorns? – Black&White™ […]
Great observations Ben, thanks!
Yes but how do you explain that Europe historically have had much more success with building companies when I assume they were even more socialist and even more bureaucratic?
To answer is so easy – there is much more socialism in Europe, that is much more bureaucracy, that is much more obstacles for startups, etc.
But how come it used to be easier then? There are plenty of european companies in the Fortune 500 list?
That I am actually not so sure about but I have no hard evidence. The numbers game goes both way, there are many more Europeans than americans.
Also a little tidbit. There are fewer startups created today than there used to be BOTH in the US and in Europe.
Is that because the investors are more risk averse and why do you think they are?
I am originally from Germany, now a digital nomad, soon to be moving to SV…
I have been to the US a couple of times and to SV two times. I’ve been to most european countries and have lived there most of my live. Hence I want to share my reasons that I have build up in my head over the past few years:
1) There is no such thing as Silicon Valley in Europe. Silicon Valley is in California my impression also was that a lot of people come to CA because of the weather, the sun, culture, beach etc. Hence why would I start my business in London, Sweden or Berlin where its cold and rainy for 6-7 months? So I’d rather go to southern Europe, which is great – but not so easy to deal with (bureaucracy, high taxation, infrastructure, language) and there is lack of a single point of geographic entrepreneurial density. (like where do you go? spain, portugal, italy, france, greece, croatia….? and which city? ) so it spreads out… and there is no competition, no exchange etc.
2) Europe has high taxes, most of problems seem to be solved by politicians hence they take away freedom of choice (and power) from the people. E.g. health care, eduaction are just two main examples. these market are mostly regulated hence there is no room for improvement from the private sector. (sadly most people also don’t want change here)
3) Europe is at least 2 years behind the US when it comes to technology and technology mindset. Most people have the mindset of buying cheap and low-tech. Like why do I need that? Also like data concerns are really high… That explains why for example in the US iOS has ~50% marketshare and in the EU ~15%. iOS makes a lot more money…. So the chances of making money are worse and also since startup people and especially their customers are a few years behind with technology, s.b probably has build it in the US if a european guy has the idea and starts building it…
4) There is not a real European Culture (yet) in Europe. Europe needs to become like a nation, celebrate as one, and become proud of it like the americans do it. Right now everyone in europe looks over to america, etc … Hence if people start companies they start them either at home with focus not their small home market or go abroad…
The other thing that I’ve seen personally from European investors is that they are much more demanding and often behave in ways that are extremely deleterious to the start-ups they are prospectively funding. It seems that the informal enforcement mechanisms that make US, but particularly Californian, investors well behaved are almost entirely absent in Europe, perhaps because of the lack of geographic concentration. This is probably a big reason why the European start-up talent comes to the US, and even a bunch of the European investing talent too.
To add to that I’d say that much of the “entrepreneurial” energy in southern Europe goes into work that is “under the table”. Spain and Italy both put up awful unemployment numbers because regulation is tough on the formal economy, driving people into the informal economy.
I think all of the points you mentioned probably play a role, but I think there exists a much simpler explanation as well: It’s a numbers game. I’d estimate (just form personal experience, no hard facts here) that the number of startups started in the US (and most of them in SV) are easily 10-20x the number of startups started in Europe. So, isn’t it natural that, given an equal chance of success, most unicorns are US companies?
Nice write-up! I definitely agree that the fragmented nature of the EU with dozens of different local realities (even just limiting the discussion to the markets with higher spending power) makes it hard to consistently hit “one fits all” solutions to problems that in the US would be generic enough at the federal level. There are localisation barriers (I believe Netflix is releasing in Italy just this month… shocking) but not only those. The EU has a common set of laws that countries must adhere too but countries themselves have complex, varied and often arbitrary (for historical reasons) local legislations that often constitute a multitude of barriers of legal nature. Look at how Uber for example was forced to shut down business in (again) Italy for “unfair competition”.