On Monday, the founders of some well-known technology startups in Europe signed an open letter calling for the creation of a single pan-European organization “EU Inc” to promote startups and innovation in the EU. He writes about it Konstantin Kryvopust with reference to CNBC.
The list of entrepreneurs backing the proposal includes Patrick Collison, CEO of fintech giant Stripe, Taavet Hinrikus, co-founder of money transfer app Wise and venture capital firm Plural, and Eleanor Crespo, CEO of French unicorn Pigment. Venture capital firms Index Ventures, Sequoia and Seedcamp also signed the letter.
The letter notes that, unlike the US, the capital of European investors, as a rule, remains within national borders. This leads to “delayed momentum, unrealized potential and artificially limiting the chances of local startups to succeed.”
Instead of writing new EU-wide legislation to ease the rules for tech startups, the founders are calling on politicians to allow the creation of a new single entity called “EU Inc” under the bloc’s 28 regime. The so-called 28 regimes are legal frameworks within the EU that offer an alternative to, rather than replace, Member States’ own national rules.
It said EU Inc would “standardize investment processes, simplify cross-border transactions and create a unified structure for employee stock options” to help European startups scale quickly and raise more capital.
Last month, former European Central Bank President Mario Draghi released a report calling for 800 billion euros of additional investment a year to make the EU more competitive on the world stage.
