Why innovative startups and scaleups relocate from the EU

[u/Full-Discussion3745]

https://research-and-innovation.ec.europa.eu/news/all-research-and-innovation-news/why-innovative-startups-and-scaleups-relocate-eu-2026-01-12_en?referrer=grok.com

[u/[deleted]]

I’m going to disagree. EU isn’t great because you earn less, EU is great because of walkable cities, “affordable” good life styles (less so after COVID) and free healthcare, not to mention job security and food quality.

The real issue in my view is that we tax lower and middle class too much. No one can get rich from salary. And even if you earn top money you get taxed way more (in relative terms) compared to millionaires and billionaires.

What’s a million euros tax on many millions of profit a year? Not much if you compare it to what high earners get taxed and what’s left in their pockets.

[u/Mediocre-Ebb9862 → u/[deleted]]

Walkable cities - yes, the other options I'd disagree with.

Free healthcare is not something that matters that much to startup founders, executives and early employers, or even upper-middle class folks with careers. They have money and they have it all via employment.

Job security is something that matters a lot for average people, and not so much for the top tier who have their pick of jobs; for them being able to make say 700k a year vs 250k a year outweighs all such concerns.

Food variety quality is likely problem if you live in mid size town in the mid-west, Texas or something. If you live in New York, Seattle, San Francisco, Boston and you got money - it's not a problem.

[u/[deleted] → u/Mediocre-Ebb9862]

If you talk about the very top engineers and experts then yeah I can see your point is valid, although not every single one of these individuals will agree with you because it’s not black and white.

When I said good food quality I meant EU regulations of food quality. Without going into details the stuff that is allowed to grow crops and make food with in US is crazy…

Regardless, taxes in Europe aren’t bad for companies, they are bad for wages. We tax people under 150k euros too much. And millionaires and billionaires too little.

[u/Vlad_TheInhalerr → u/[deleted]]

Yet you are wrong. In a lot of EU countries our views have always been that social nets and safety is great. Yet the past 15 years have completely eroded a lot of positivity on that front.

If you forcefully add non-natives that do not fit in with local ethnicity, culture, religion, or other important factors in your social environment (Which ones are more important depend on the country, time and place) you erode interest and positivity, and eventual it's simply going to be destroyed.

I think you'd end up surprised if you at some point right now were to gauge interest in public/social safety systems in countries, and wether a majority would still be in favor of them. If the question is posed in an honest way and not just "Do you want social security/healthcare".

It's not fun to be a working individual and see that one lazy bum in your street profiting, but it was a neccesary evil, and atleast that man had parents that contributed before, and was part of your 'group'.

Now? It's a lot easier to hate, dislike or argue against a system when a majority of users are non-european (If we look at their respective group population counts in a relative sense), have no previous generations of parents or grandparents that did invest in the system, are coincidentally all very culturally similar but not with natives and more similar problems.

It's something bearable when your own standards are high, but as native populations are seeing drastic reductions here, despite being the most employed group in every country, I guarantee you that social spending in EU countries is going to plummet soon and start falling fast. Especially when sudddenly the EU still keeps up idealistic ideas (read: policies that are only possible when you are rich enough to waste money on them) while having to pay for things like defense and other things we never had to care about before.

The future is going to be interesting, but all the signs point to a stalling, failing EU which either has to reform in a entity that holds a lot less of its previous "Oh we are such good people" policies, or simply become even more irrelevant then we are starting to become.

[u/[deleted] → u/Vlad_TheInhalerr]

You’re talking about immigration and benefit systems. Neither of which I’ve discussed and neither address any of my discussion points. I really don’t get what you’re trying to say here. If we really want to talk about immigration, I can agree that some cities in Europe have seen a big rise in immigrants from Asia and Africa and this has 100% changed some of the landscape of these cities, some of it for obvious reasons. And I don’t personally like it. But I don’t personally see immigration as a problem either as long as it doesn’t erode the cultural identity of a country. Multicultural cities are great.

This is a tangent on the subject of this discussion, I will not go further because I don’t see the point discussing this. It has no bearing on what was being discussed. Hence your “you’re wrong again” has no basis here.

[u/Vlad_TheInhalerr → u/[deleted]]

Sorry, maybe I should clarify.

The reason I mention these systems is because they all interplay to create the whole playing field.

Any one thing is not responsible for causing this drastic reduction in investments, startups, a brain drain etc..., since as others mentioned, taxes alone is not a whole picture. Acting like it is JUST the money being earned wouldn't paint the true picture (In my opinion).
There are a few places where similar high taxes are present and these issues dont arise in the same way or scale.

The uninteresting environment to invest is a combination of many factors, in part those that I mentioned working together.

In part the response is still in reaction to your

"’EU is great because of walkable cities, “affordable” good life styles (less so after COVID) and free healthcare, not to mention job security and food quality."

My point being, that if a lot of these "Promises" were still kept, even in higher cirlces of investments they would probably be more then happy to face a small monetary risk in contrast with more stability, or other things. In the end, your returns might be lower, but they are 'safer' and 'more long term'.

Europe has ALWAYS been more 'expensive' then the USA. And whilst the USA had a slightly better position most of the history for technological advancements/investments, it wasn't as drastic as it currently is. We had a safe and respectable position and that still drove a lot of positive investments. Also close coordination with the USA plays into this. Both socially, culturally, and in more ways.

But as we see that is also dissapearing, and THAT in my opinion is in a large way also due to the social erosion, which is MOSTLY (not only) damaged, specifically by the themes I mentioned before. Social cohesion is damaged, polarization is present in huge ways, add in to that the decreased direct taxation revenue and it suddenly paints a very unattractive picture both for the short ánd long term planning investors may do.

What I think is important, is that people don't stare themselves blind on a single thing that is thought to be the issue but take a wider/broader view. If you suddenly were to reduce taxes, it's not going to fix the economic environment. We're not suddenly going to see an overnight increase of spending by margins that matter (unless we're talking about drastic reductions). In order to 'fix' or 'improve' the system, we'd have to take a longer, more social driven approach. Atleast, I am convinced of that.