In America there is an "A to Z" of software and computer houses from: Apple, Borland, Compaq and Dell toWordPerfect, Xerox, Yahoo! and Ziff-Davies. Name, say, a German software company that doesn't begin with the letter "S". (not Siemens, Software AG or SAP, thank you.) So why does Europe lack these American success stories?
In the UK the education system is essentially anti-enterprise. Compare our attitude to business failure with that in America. Top talent goes to the safer and better-paid City and professions, a lack of competition makes us sluggish, reliance on consultants makes us advice-dependent and commitment to IT investment is poor.
A large part of the reason for America's success is the size of its domestic market - 250 million customers, a single language and a single currency. Couple that with a positive attitude to both success (they are only too willing to discuss incomes) and failure (how else do you really learn?) and you have the recipe for success. As the Economist put it, "bright ideas occur everywhere, but Americans remain unusual in their willingness to accept risks, in their tolerance of career shifts and above all in their joyful attitude to business".
There is no law in Europe stopping those with flair from starting up on their own, but somehow the odds seem stacked against them really succeeding, especially when we consider Europe's institutional investors and banks, who are so nervous of assisting exciting start-ups, which is to say, those that they don't understand.
The United States has developed a venture capital industry that is the force behind its entrepreneurial success. It has created a way, and developed specific institutions, for turning small companies into big ones. In Europe, venture capital tends to prefer safer and more mature companies; not the start- ups.
Returning from a conference by train recently I dozed off and began to dream about a Europe in which entrepreneurs were encouraged to put their bright ideas into practice.
So, what needs to be done?
If Europe is to help the right sort of ventures, and venture capitalists, to thrive, we need to do more than just encourage more investors to take a risk by putting their money into newer business. I feel that we need to see lower corporation taxes and more tolerant regulation because these hurt the small business disproportionately.
So, what is my dream?
I dreamt of a place where there were venture capitalists investing in hi-tech start-ups and managing and nurturing them.
And how would they nurture them?
The venture capitalists would use their reputations so that their start-ups would get special deals from lawyers, accountants and landlords who wanted to be involved.
To grow the start-up business, the venture capitalist would provide chunks of money needed to deal with specific obstacles that need to be overcome and various stages.
But, more importantly, the business ideas would be given the opportunity to "fly". Very quickly the minnows would grow to become significant players in their market by the combination of brilliant business ideas, entrepreneurs and experience financial support.
All this enables the company to excel at the three things that high growth businesses need to be obsessive about: market focus, developing the team, and strategic thinking.
And then I woke up and realised my dream was a reality - it was venture capitalism - venture capitalism Silicon Valley-style.
Robert Craven is a consultant with an international reputation. He runs the Directors' Centre and is an Associate Fellow at Warwick Business School.Reuse content