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Starting A Business in the EU VS US: What Are The Differences?

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Starting any business is no easy task, and you can ask just about any startup entrepreneur. In the current economic climate, with ever-changing social and technological trends surfacing each year – business owners and startup entrepreneurs are constantly looking to which area is the best fit for their new business idea. 

Those entrepreneurs and business owners who are willing to take the leap, and start a business on foreign grounds have been faced with a difficult question, which is better for starting a business: Europe or the United States? Both these continents offer some of the best capital gains, and successful business growth for new startups, but the ultimate conclusion will boil down to what each has to offer for the business, and how fast will the business be able to grow?

We’ve looked at some of the key differences between starting a business in the EU or in the US. Bear in mind that the US has trademarked itself as the epitome of venture capitalism, while the EU is pushing for pro-democratic business ventures. Although both can be seemingly attractive for entrepreneurs, they can also have their challenges. 

The American Business Landscape 

For decades, the United States has been leading the leading global economy. Offering attractive business opportunities, and ease of market access to new startup entrepreneurs. American startups, to some extent, have more support from local and federal government entities. These come both in the form of financial, and human resources. The US has implemented a strategy that eliminates the minimum required capital to start a business within its boundaries. These can obviously change throughout the landscape, as different states, counties, and municipalities have their own jurisdiction. 

On the other hand, US startups are competing in a massive market of competitors. Penetrating the market takes more time, resources, and a lot of effort. This puts limitations on certain business services and products. A simple example is the massive overuse of Amazon, where customers can shop just about anything from the comfort of their homes. Mass corporations lead the race, while smaller and medium-sized businesses are lagging in second and third place. 

For example, Zen Business is a platform that allows startups to find assistance and local resources in their area. Making it easier for entrepreneurs to build a network of business support. 

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A single free-market strategy

Although a tricky policy to duplicate from paper to practice, the EU and its member states have been working hard to incorporate more free trade and business deals between EU members. Small businesses have access to an untapped market of diverse clients and customers. The EU Commission has also reserved federal funds from various countries within the European bloc to help startups and small to medium-sized businesses have access to better financial capital. 

Removing limitations for the movement of services and goods has created a free market, where the people can be in charge of how they want to operate their business. Although limited government intervention is good, it can also leave businesses growing at a slower pace compared to those in the US. 

The Inc. Plan

In recent years, the US government has been working on the Inc. Plan, a federal initiative to assist European entrepreneurs to get their business started on American soil. There are a host of different benefits that can help EU business owners start a business in any of the 50 states. Business practices such as these can allow more foreign investors an opportunity to penetrate the US business market. 

EU small business ecosystem 

Depending on where you want to start a business in the EU, many entrepreneurs have claimed that they enjoy more freedom and autonomy when it comes to equity dilution. With this in mind, we notice that those businesses and startups who want to serve a specialized market of buyers and consumers will find it more comfortable to trade within the EU. Some business leaders have claimed that those startups generating revenue by delivering a product or service that consumers want, is a product-fit-market. This enables niche startups to have better access to a wide variety of diverse consumers. 

Ultimately, the final answer lies with the type of business owner and the business they’re looking to create. The US offers a large pool of capital funding, great federal support, but competition is strong. The EU makes it easier to have access to a single market of buyers, and diverse consumers. Both offer a lot of business success, ultimately the success would ride on entrepreneur initiative and overall involvement.

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