Anecdotal evidence and a lot of narrative. What a poor article. Reminds me the also poorly researched bashing piece on Argentina a few months ago. They missed the point completely as business is booming here. A recent startup conference registered hundreds of projects. INC is junk reporting.
Yeah, it's worrisome to see immigrants or (especially) naturalized or native-born citizens with strong ties overseas leave the US to start companies. But not necessarily a bad thing.
If they are leaving because the US has become an unfriendly place to new businesses, especially in high tech, that's bad.
If they are leaving because opportunities overseas are exceptional, and it's easier to capitalize on those opportunities for people with strong cultural or linguistic ties to a particular region, that's not necessarily bad. Having grown up in SF, I see the tech boom as a mixed bag. It's of course phenomenal to have so much wealth here. But I've also seen a lot of displacement. It's hardly a crisis that we can't cram every single tech startup in to this small peninsula, and I don't think it's a bad thing that people might actually want to live somewhere else either, in the US (Austin, Seattle, Boulder...) or overseas (Seoul, Bangalore, Copenhagen...).
That said, I do think these sort of stories do underscore why it's so important for the US to have a steady and reliable stream of STEM graduates come up through our own educational system. It's great to be open to talent from the rest of the world, but becoming excessively reliant on it long-term seems like folly to me.
It seems to be a case of the latter. These entrepreneurs identified a gap in a foreign market and exploited it. It's mutually beneficial - benefits them because they are now a leader in their market, and it benefits us as there is now one less social-fucking-coupon website that we have to hear about.
This is just one anecdote. I don't see a broader trend of entrepreneurs fleeing the U.S. It's true, entrepreneurs are outside-the-box thinkers, so they may do unexpected things. Though the U.S. has plenty of troubles, I don't believe it's any better anywhere else.
(Except maybe Canada :-) I'm not from there, though, so I wouldn't know.)
Canada is generally regarded as a terrible place for startups, unfortunately. The laws are pretty restrictive towards "disruptive" technologies and the government always bends in favour of the existing players.
> Canada is generally regarded as a terrible place for startups, unfortunately. The laws are pretty restrictive towards "disruptive" technologies and the government always bends in favour of the existing players.
What the heck are you talking about? Can you please provide some sources for this? Other than telecom and media I can't think of any space in the tech industry that the government is "restrictive" towards. In fact the Government has amazing programs for tech startups like SR&ED and IRAP, and you have amazing support systems like MaRS and Communitech in Ontario, with analogs in practically every province.
The thing that makes Canada tough for startups is the lack of an established VC ecosystem. This is why you see quite a few bootstrapped Canadian startups, and only a few Canadian startups that go really big. But labour is significantly cheaper than in the US (especially when you factor in free healthcare), labour in Canada often has a more worldwide mix (because of a large immigrant population), you get awesome tax credits and incentives, and quality of life is near the top of the world.
I'm not usually so jingoistic, but this one-off comment was really quite strange.
Canadian expat here. You missed one thing: a dramatically smaller talent pool.
The brain drain for coders from Canada to the USA is immense. It's not a trickle, it's a full-on broken dam. I'm making easily double here what I would in Canada, even if you account for tax and cost of living. Software engineers, in general, simply don't get paid well in Canada. The ease of securing a TN visa also means that there is effectively very little barrier to anyone who wants to bail to the south side of the border.
I can't speak for everyone - but amongst myself and my other Canadian expat colleagues, a very large portion of the Canadian coder population that have the chops to get hired have left. What does this say about the talent pool that remains?
That's not a great position to work from.
Disclaimer: I am not at all claiming there aren't masterful coders in Canada, but rather that a lot of the wheat has left the country, leaving an extra heaping serving of chaff.
The funny thing is, among my Canadian colleagues here in the US, it's almost universal to want to return to Canada. The health care is sane, society is more peaceful, and the quality of life is noticeably higher than just about any US city I've been to.
Those conversations inevitably, and always, turn into us sitting around nursing beers, and wondering where in the hell we'd work in Canada that'd satisfy us professionally.
Biggest software names in Canada? EA? SAP? RIM?!
This is somewhat OT from the entrepreneurial side of the question, but also relevant. The job market in Canada has a lot of code monkey jobs, and not a lot of meaty software jobs that hackers crave. Much of the reason why there's such a huge drain of programmers from Canada to the US is not just the pay difference, but also professional satisfaction. I can't move home because almost nothing in Canada will present the level of challenge, the level of impact, that I can have here.
Do you have any idea why coders are paid so much less? Is it because all professionals are paid less (ie., are lawyers, physicians, etc all paid less in Canada)? Or is this more of a regional pattern combined with a cost of living (ie., coders are paid less in Wisconsin than in California, but might live better on what they do earn)? Or is it maybe related to productivity, that coders in these concentrated areas are able to be so much more productive than they are elsewhere that they're simply creating more wealth...
Anyway, would be interested in hearing the thoughts of a Canadian expat on this one.
I have some theories, but not a lot of proof - as is the case when arguing the effects of policy.
If you look at the job openings in software in Canada, you will find a lot of US satellite offices hiring. Adobe, Autodesk, Apple, IBM, Microsoft, et al all have significant presence across Canada, but the pay for Canadian positions is inevitably far, far less than their American counterparts.
Part of it is the lack of entrepreneurialism in the field, I think. Because of the lack of startups, and the lacklustre VC scene, the industry doesn't have lot of domestic legs to stand on. A huge part of the software industry's identity in Canada is "like America, but cheaper" - there aren't enough homegrown companies to counter this trend.
The software jobs are also dominated by fields where it's a cost centre, not R&D. The biggest employers of software engineers in Canada are banks and telcos, not "pure" software companies. In this environment, the majority of openings are IT monkey jobs, not high-level engineering positions.
There's a lot of talent coming out of Canada, the majority don't stay though, and they won't so long as the US offers more interesting jobs that pay double, triple the Canadian rate. More professional satisfaction, way more money? I'm not made of stone!
I can't answer this question with a very high level of confidence for all of Canada (I'm based out of the prairies) but my current feeling is simply that the quality of the positions are lacking, as the parent has pointed out.
There's a view that programmers are code monkeys. If looked at from the perspective of a manager within the manufacturing industry (Many of Canada's high net worth individuals, especially in my city, have some sort of manufacturing/hard goods background) programmers are high level production staff.
As a result the jobs generally aren't very exciting and don't pay much. Mechanical Engineers are more sought after in my city, at least.
Six figure jobs seem to be within smaller boutique firms and a few of the big companies but it is far from the norm and there aren't many of those to choose from. Programmers earning more than $150k are virtually unheard of, as far as I know. My knowledge could be inaccurate here though so please take it with a grain of salt.
To change it would mean more jobs of a different nature. Startups are the only solution I currently see to change that long-term. And we have many other issues to contend with beyond a smaller talent pool and scarce funding.
I think it'll take a few big wins by a few entrepreneurs with, as my lawyer likes to put it: "balls of steel", to be willing to stay in their local Canadian markets for there to be progress in making this a better place for software engineers and in turn, other startups.
I am starting to notice a slight change and some locals urging me to stay local. Perhaps there's hope for the future.
So to try and succinctly answer the question, I think the pay reflects how interesting the jobs are, unfortunately.
I've chosen to stay in Vancouver for personal reasons. I like it here but it's not much fun to see friends find only mediocre opportunities locally and then end up in Mountain View making ~six figures. Unfortunately as mentioned above this creates a sorting process where the best and brightest leave.
There is a growing startup scene here, but the cost of living hurts -- this is the land of $60-70K salaries and million dollar houses. Real estate costs are such that the startups mostly seem to end up around the drug-addled Downtown Eastside, which can be interesting to say the least. Vancouver's a nice city but it's also kind of crazy.
Cheap labor isn't necessarily a win. It means the best engineers will use NAFTA to go work in the USA where they will be paid 2-3x as much. The last startup I worked for in the Bay Area had over half its engineering staff from Canada.
It's not exactly a one off comment. There was an article posted, I believe here, about the state of startups in Canada. I can't seem to find it at the moment, but I do remember a few examples from it:
* iCraveTV, a Canadian online video service, saw the government cave from US pressure to change Canadian laws regarding online video, which ultimately put them out of business. Later, a bunch of US-based startups entered the same space.
* OpenText, a Canadian search engine, was unable to index the general web due to the law in Canada. While still successful in the corporate space, they could have been a player against Google and Bing if things had been different.
* ZENN, a Canadian automobile manufacturer, is unable to sell their cars in Canada due to legislation. For comparison, Terrafugia, US-based company building a car/airplane hybrid has been able to change several laws in the US to allow them to enter the market.
You can attribute the position these companies find themselves in down to management, but the political climate does not help matters. You can still build a decent business in Canada, but building something revolutionary is more easily accomplished by people of other countries.
That's been my impression too. I'm trying to figure out why that is the case. Is it mainly because of laws that make it hard to fire bad employees? Payments such as unemployment benefits, social benefits, etc.? Tax code issues? Or something else entirely?
Also Canadians tend to be less ruthless (I'm not going to debate the right or wrong on this but seeing that the biggest and most successful companies are driven by ruthless people...)
Canada also has a small (but growing) market. There aren't too many big cities and big spenders.
Vancouver, while it's beautiful and nice and all that, the majority businesses tend to revolve around government agencies.
Every little bits definitely taxed startups chance to be successful.
Compare to Silicon Valley where people would almost definitely give try all-things-mobile or web2.0, Vancouverites prefer to hike, bike, enjoy foods.
All in all, Canada is still conservatives when it comes to technology.
Having said that, I was surprised to see big names in Computing technology born and bred in Canada but all moved and made it big in US. Kernighan, Gosling, Aho, Rob Pike, Rasmus Lerdorf, Kenneth Iverson, etc.
"Also Canadians tend to be less ruthless (I'm not going to debate the right or wrong on this but seeing that the biggest and most successful companies are driven by ruthless people...)"
I agree Americans are more entrepreneurial, but I don't think it's evident that ruthlessness is a desirable trait in business and think that Canada's sane public policy in taxation and health care makes it better to live and hire in Canada than the United States. The problem as parent-post says is that if you need venture capital you simply won't find it, so businesses have to focus on revenue rather than offering free online services.
As far as academia goes, my experience is that when it comes to undergraduate education Canadian universities are better or equal to their American counterparts. But the States have better graduate programs and better endowments at the top-end, so a good student can get a free ride in the States and return to Canada with a prestigious foreign degree that will carry more weight in the job search and that reflects more cutting-edge research. Their counterparts who stay in Canada will conversely have to self-fund graduate work and do more teaching work for lower pay, often getting a separate MA and PhD instead of doing them concurrently as in the best US programs. Prior to 2008, the American economy had always been better than the Canadian economy for about twenty years, so you have twenty years of economic pull as well -- there have traditionally been more and better paying jobs in the States than Canada.
That said, there's an old Canadian joke about a preacher from Saskatchewan who was getting up in years and began to pepper his sermons with asides about how he would soon be leaving for that land from which no man ever returns. And how his parishioners immediately understood that he was moving south of the border.
"As far as academia goes, my experience is that when it comes to undergraduate education Canadian universities are better or equal to their American counterparts."
I completed my undergrad in Canada then moved to the US. There is no Canadian undergrad program that comes close to the top programs in the US. I did some grad work at an Ivy League school and the undergrad programs are incredible. Not so much in terms of having better content or professors (although that is generally true), but mainly in terms of providing personalized guidance to young students from day one. The stories I heard from the undergrads I met were astonishing. Interested in chemistry? We'll set you up with one-on-one meetings with Nobel prize winners and industry titans. If you're good, you'll basically get access to the top opportunities without really asking.
Oh there's this thing called SRED which can be double edged sword.
On one hand, you get back half of your expenses paying salary and all that stuff and on the other hand, it makes your balance sheet looks profitable even though in reality, a few companies are actually on the red.
When it comes to paying jobs and cost of living, my idiotic brain usually look at the situation this way (this is by no mean the right way to make a decision but I use it for my own regardless):
Let's take one O'reilly book and turn back to check the price. Canadian is always more expensive right? (Due to currency exchange or whatnot).
Let's take the same job (Software Developer) salary average given the same experience level: intermediate. One might receive about $80-100k in the US while in Canada, they might receive $65-75k. Plus the jobs aren't that many here.
Canada: higher nominal cost of living and lower nominal. income.
There are gazzilion reasons why people opted to do business back home as opposed to the U.S. and all of them are probably similar decision-making as to choosing your next programming languages: there's no one reason to rule them all.
I'm an immigrant. I'm considering heavily to go back home and start a business there (online, offline, doesn't matter). Reasons? cheaper workforce, more power, more connections, cherry picking, bigger pond, more people (consumers), etc.
I'll be using North America to include both US and Canada for the rest of my comment.
Here are a few more detailed examples (all of them are of course anecdotes to me):
Managing westerners that believe that they're entitled for everything such as perks, private offices, their choice of programming languages, their choice of best practices are often a time consuming activity. Back home, I can drive the workforce to do the best practices that I believe without having to have long discussions. Give them laptop, give them work, they're happy. This is because their mindset, perspective, and standard are different than here in North America. They're also cheaper.
After working with many programmers throughout my careers, I kind of grow a belief that I can train the less "creative" developers back home to be at the same level at most of the programmers in North America. They might not reach the level of superstar engineers, but they will reach the level of more than good enough at where I will be.
Connection is a big thing. It's harder to have a connection in N.A., especially when you're an immigrant (maybe it's just me). Where I come from, hooking up with people who have excess money is very easy. Especially when you graduate from a pretty good N.A. university (doesn't have to be Wharton or Harvard, UC Berkeley, UC Irvine is enough). They look at you as someone who has something "more" (whatever more that is).
In Iowa, you're nobody. In the [Capital City of your ancestor's land], you're something. Imagine that.
Overall, I find that the majority of large Asian cities are probably more alive than some well-known (but not necessarily large) N.A. cities.
"Back home, I can drive the workforce to do the best practices that I believe without having to have long discussions"
But this where you may be missing out on the value of a worker. In this day in age, someone who just cranks out something to a mold or specification is not as valuable to an organization. I'd much rather pay someone 5 times as much if they can think on their feet and not always have to rely on me to figure out how they should be working. Constantly having to define practices for a team of lemmings is a typically exhausting full time gig when you're the only one to take initiative and guide. The other problem is that we all make bad decisions from time to time and it is important to make sure we have competent people around us to correct our course when that occurs rather than a bunch of yes-men.
These best practices are just the foundation, not necessary the long-term solutions. Once you have a set of standard, there's always room for improvement or changes.
The biggest problem with N.A. workers is that they can be categorized into 3 types when it comes to "Do Things":
- Do as they pleased (cause they think they know it all)
- Follow the best practice
- Follow the latest and greatest best practice and create some sort of work revolution in the middle of directing the ship toward the goal
You kind of need a "Yes-Man" if you're on early stage of startup inventing your own dream (I'm sure this is going to open a can of worm but hey... it's your startup).
I'm not discussing whether this is the best way or the worst way. I'm focusing on the "why" people chose culture that prefer "Yes-Man". It could be a way for them to exploit human psychology for all I know.
That's the thing. You need to be there to see how things are happening/working. It's totally different in there (Asia) than in here (US).
Ramsay's Kitchen Nightmare advises won't work in Asia while it may work in US or UK.
>You kind of need a "Yes-Man" if you're on early stage of startup inventing your own dream (I'm sure this is going to open a can of worm but hey... it's your startup).
Nonsense. You are not smart enough to run your company. That bears repeating: You are not smart enough to run your company.
In other words, you will face unexpected challenges and problems that you aren't smart enough to solve on your own. In a situation like this, being surrounded by "yes men" is the worst possible place to be. Employees that can't or won't think for themselves won't be able to help you get out of a jam. They won't be able to tell you that you're going in the wrong direction. Instead, your own workload will grow exponentially as you find yourself having to tell your employees what to do as opposed to having them figure it out for themselves.
Even worse, you'll find yourself cut off from vital information. You'll find that you don't receive news unless you specifically ask for it. In other words you'll be flying blind with faulty instruments. That's not a situation I'd like to find myself in as an entrepreneur. I would much rather have employees who can take initiative to fix problems and pounce on new business opportunities. I would much rather have employees who tell me that things are going badly without having to be prodded. A "yes-man" is the very antithesis of this.
It's hard to argue because I've seen many companies/businesses that start that way back home or in Asia.
Only later on when they're stable enough to hire smarter people then they start to delegate.
YMMV. As I said it before, it's one of the reason why people want to go back regardless whether I'm wrong or you're right.
It's the worst place for you but not necessary for other people.
Different culture but I haven't seen China nor South Korea fail so far :).
UPDATE: Since I can't reply any more (for whatever reason). Sure, innovation might be lacking, but meh, most people come back because they want to create a company/business. This isn't a debate about USA vs the rest of the world in terms of innovation. It's about "why" people left US.
>Different culture but I haven't seen China nor South Korea fail so far :).
It's also the reason they haven't made any major inventions or advances. The yes-man culture is positively noxious to innovative thought, and if you look at Korea right now, they're trying to loosen up that culture so that they can innovate and don't get stuck in a role of constantly receiving secondhand innovation from the US/Europe.
He might not be smart enough to run his company. But I've seen more than a few people who aren't smart enough to run a company, but are lucky enough to hit payday.
Sadly, this sort of failing upwards just reinforces their world view.
>In Iowa, you're nobody. In the [Capital City of your ancestor's land], you're something. Imagine that.
Really? My experience (as an immigrant) has been quite the opposite. Here in America it's a lot easier to become "somebody". You work hard, develop your skills and learn to market yourself. Once you do that, you're either on a upward trajectory at your current firm or you have the prerequisites to find yourself a better position elsewhere.
In my native country (India) family connections still count for quite a great deal, and job switching is still somewhat frowned upon (though attitudes regarding both of the above have improved immensely in the past 20 years). Therefore, you can have skills and a hard work ethic and still find yourself stuck in a not-great situation.
My assumption/pre-requisite is that if you can become an immigrant, in a few situations, your family is rich already or successful back home thus you would have connections already and you're probably in mid to high economy class.
I think you can say the same thing too everywhere: Work Hard, Develop Skills, Market yourself.
Marketing seems to be the key point in developing countries probably because the average people are not exposed to certain kind of hypes.
>My assumption/prerequisite is that if you can become an immigrant, in a few situations, your family is rich already or successful back home thus you would have connections already and you're probably in mid to high economy class.
That's not always a good assumption to make. Not everyone who makes it to the US is rich or well connected. In fact, the vast majority of immigrants to the US have not been rich or well connected back home, which is why they immigrated to the US in the first place.
Amazingly, if you have thousands of entrepreneurs, some of them will go to other countries. I'm sure there's also some examples of South Korean entrepreneurs coming to the US and starting businesses here. I've worked with some guys who came from Taiwan and started multi-billion-dollar US ecommerce businesses.
Are either of those necessarily trends? Not unless you can come up with some numbers to support the anecdotes, which this story doesn't seem to have. We don't know if entrepreneurs are leaving at a greater rate than before, or even if there's a net loss (lots of people come to the US and end up starting small businesses.) If it's in the story, I missed it.
It’s true that South Korean start-up scene is getting better from the interest of institutional funds, which got up from the apparent success of the Grouponzi-style businesses, esp. TicketMonster. But it’s a whole lot different story that the Americans return here because Seoul is a better place for start-ups. The M&A market for Internet start-ups in Seoul is almost non-existent, except few cases like TM, and TNC, the only acquisition Google made in South Korea. I don’t understand how this ecosystem would persist without deals any longer.
As a side note, the Shin in the article is a family member of the “big brother” Chaebol, Samsung Group, which has close knots with big conglomerates such as CJ Group, Joongang Ilbo, Shinsegae, and more, almost to the extent of their aggregate revenue reaching almost a half of South Korea GDP, so he earned attractive deals from big local brands so easily. Shin wan’t irrational enough not to exploit his family connections to build a business based on a totally unprofitable model, a feat only possible at the right moment and right place. Definitely, he’s a smart guy, smart enough being ready to return if he no longer sees his advantages here in Seoul, which I think would be quite unlikely though, due to his superb “Zuck status” in S. Korea.
Along with the answer to your question that someone may provide you, perhaps also change, adventure, and rocking the boat? Mixing a little bit of life experience in with entrepreneurial endeavors? I'm only 23, but those reasons compel me.
Would it compel to leave permanently though? I left my country of birth for the reasons you stated but I guess somewhere in the back of my head I see myself returning one day.
Rationally those are compelling reasons for a business to leave.
But I think personal reasons play a huge role in this decision. A majority of the people tend to only leave when the situation becomes unbearable (or not even then).
What would it take for you to leave your home country/area?
I guess it's hard to say until it actually happens. One reason for me to leave would be an oppressive government, I guess.
I would add 'Visa issues' to that list that applies to people who are itching to start companies in the US after being here for 5+ years but cannot due to visa restrictions.
I'm not much of an entrepreneur, but I'm planning to move just across the border to Vancouver so I can live with the Canadian I've been dating for eight and a half years (it's not totally impossible for us to live together down here but it's just so much more of a hassle that it's not worth it).
Unfortunately when I last checked a few months ago no one was really looking to hire iOS developers up there.
Sure, there are entrepreneurs leaving. But there are still lots of people moving to the States to become entrepreneurs. YC is one of many factors. What's the ratio of coming to going? I suspect that it's still quite a bit higher than 1.0...
Yet another article written for the pleasure of its author. Just tell us what data you have and how they answer the question in your (leading) headline. Three sentences and a table; done.
I take exception to this point--You want a table? Make a table--But so you know: There are very few stats on reverse migration because the U.S. government stopped tracking it in 1957. There have been some really great studies academic studies, if you're interested in checking them out.
There may be a few stories like this but this is the exception, not the rule. As much as we have problems here in the states, it's still one of the easiest places to start and run a business (#4 in the world).
I didn't quite get why the guy in the story left for Korea though. It was just a story of an entrepreneur who left the states and is now S. Korea's Zuckerberg. So? I mean, it's impressive but so what if he left? Maybe his particular business would fair better there but again this the exception and not the rule.
There are other countries like China and India that have exploding GDP but the great thing about the U.S. is that while we are decently regulated those regulations don't do much to Hirt the founding of a business and allow businesses to expand easily. For example, India until recently has been chock full of mom and pop shops but not many larger, expanding businesses. This is because they didn't allow you to open a store in more than 2 location until just recently. That means no corporate franchises and the like. Over here you can pretty much do what you please within reason. Not sure why I got off track with the India anecdote but I just learned about it and thought it was very intriguing.
while we are decently regulated those regulations don't do much to Hirt the founding of a business and allow businesses to expand easily.
On the contrary, consider:
[beginquote]
In the wake of Sarbanes-Oxley legislation ..., "the psychology of the entrepreneur has changed dramatically," say Mark Heesen, president of the National Venture Capital Association. The basic reason is that in a world with Sarbanes-Oxley, everyone who wants to take their company public has to deal with extra paperwork and hoops to jump through. Those costs can add up and sometimes make going public simply not worth it. [1]
[endquote]
If your concern is going public then you have successfully grown a business to a gigantic and reasonably stable level and have beat all the odds. You have therefore picked the correct country.
While Sarbanes-Oxely does pose a financial burden on companies which is still too high (typically $1M to $3M/year), it does provide a level of protection for employees of those companies, bond holders and mutual funds which hold most of America's retirement money.
Paperwork and hoops for going public are handled by accountants and attorneys.
Sarbanes effectively removed corporate governance issues which cause huge problems (like having a captured board or having the audit firm also being paid for consulting etc.
The citations you cited are written by The National Venture Capital Association who lobbies against Sarbanes because it affects their returns. In fact, 69% of NCVA dues go to lobbying.
The second article you cite has the following quote:
"Despite the many chilling headlines and reported cases where companies have cited SOX as the reason to shelve plans for an IPO, the evidence to date that SOX is sufficient cause for companies to stay private has been largely anecdotal or limited in scale."
---
All that said, SOX is too expensive and the D&O insurance should be reduced to increase public company valuations and IPO valuations. It does represent an unintended burden on shareholders, CEOs, Bond Holders etc. but SOX is overall positive in the sense that it minimizes fraud and reduces risk for all stakeholders including non management employees.
In several of the comments, people have asked why entrepreneurs might want to leave the USA, given the common perception that the USA is a great place to do a business. I'm making this comment in response to those questions as an example of an entrepreneur whose left the USA. My reasons for doing this are obviously going to be different than those who would choose not to, so don't get mad. I'm not trying to persuade you, just explaining.
I was born in the USA, and worked for startups for nearly 2 decades in the USA, but when it came time to do my own startup, I left the USA. There are many reasons for this, and further, when I come back to the USA, I'm reminded of some of the nice things we've given up.
The biggest reason we left is that the cost of living is high in the west coast of the USA, compared to most of the rest of the world. If we could travel around the world and actually save money while getting to do something we've always enjoyed doing, then that's great. Going to europe is more expensive than the USA, but not that much, well worth it. In fact, berlin was such cool city, that if germans were more supportive of the idea that we might want to stay there for an extended period we'd be working on residency permits.
But behind this reason is another one- The USA is going in the wrong direction. Pick whatever examples work best for you- SOPA, domain seizures, an increasingly baroque tax code, increasing regulations all over that, even though they don't yet effect small businesses much, would be a burden if we are at all successful, even dealing with the TSA when I want to fly, and the thought that my tax money is being used to kill afghani, iraqi, pakistani and other children.
When I was young, I was brought up to believe that the USA was great because it believed in human rights. That the bill of rights protected us from an out of control government. Over the years, I've seen those rights be violated, one by one, and the supreme court claim that it was "legal" in their rulings. I've come to believe that there is no effective restraint on the US government by the legal system, and I've been shocked to see, how rapidly these transgressions are accelerating.
For instance, I still can't wrap my mind around the fact that at ever airport adults and children have a choice between being photographed nude by government agents and being molested by same. This is a violation of state laws in probably all 50 states, yet no charges have been filed. Worse, while many americans protest, there has been no action. I take this as evidence that americans will put up with any rights violations. Many of them will get mad, but they have no method to resolve the situation. While Obama was president when these scanners were put in, only a couple of the people wanting to run against him want them out. And while Bush was president when the TSA was created and the PATRIOT act was passed, Obama has expanded both. Despite the majority of people opposing various bits of legislation (like the bank bailouts) they still get passed. So, I see no way for things to turn around until things get bad enough to make people really unformfortable.
Also, I've studied economics and been watching the economic situation. I've come to understand the real nature of the federal reserve and the fiat currency of the USA. The USA benefited greatly from Bretton Woods alls these decades, but a side effect of that is that the inflation that has existed in the dollar supply has been exported to other countries, giving americans an artificially better standard of living. This in itself is not bad, but it and our debtor economy are dependent on that money being kept out of the system by being locked up in vaults and pocketbooks and accounts of foreigners who want it because they think the dollar is a strong currency. Given the fact that our economy is faltering, but more importantly our government is spending like crazy (obama is worse than bush who was worse than clinton who was worse than bush who was worse than the very bad reagan who was worse than carter, it just goes on...) eventually they are going to be inflating so fast that the dollar loses its reserve status, and at that point, it won't matter that the US government is inflating because people will start dumping their dollars. We'll start seeing the effect of all those previous years inflation that was exported realized in the dollars in a rather short time. This is not a black swan event, it happens regularly, just not often enough that people remember its possible. But because of bretton woods, it will be much worse for the usa than, say, argentina.
Its pretty much impossible to do business in the USA and not be tied up in the dollar economy.
Meanwhile, because I have been a traveller, I've been to other countries and seen how in some ways at least many of them are better than the USA. Chile for instance, has a culture that is more instinctively capitalist. New Zealand, while its more socialist on the surface has a much less corrupt government. So the question becomes, of all these countries, which provides the best protections of the rights I care most about and is also going in the right direction? I've not yet decided, I'm still traveling.
There's a lot to commend the USA. One surprising thing is how convenient having amazon and walmart is. Especially compared to europe. You can just order anything you want from amazon or go to a walmart and buy most anything you want. In europe, the retail stores are generally very tiny, and with the exception of an astounding chain of 3 story electronics shops we found in berlin, its often very hard to find obscure things. And when you do, of course, the prices are often almost doublet the USA due to tariffs and on top of that you've got %20 VAT.
One downside of running a startup this way is that traveling involves spending a fair bit of time on the traveling part. This gets in the way of the startup part, and it is also a bit disruptive. Each time we go to the next country we have a bit of time figuring out where the grocery store is, arranging the apartment to suit our needs, etc. We're staying in AirBnB places almost exclusively and AirBnB has totally solved a lot of the hassles of having to find apartments. But we're going to try staying linger- getting permits to stay a year or so in each country.
Finally, its a hell of a lot of fun to run a startup this way.
So, I'm sure most on hacker news disagree with at least something I've said, and this post is by its nature political because it is a questions whose answers, for me, are politically motivated. I'm not looking for a debate. If you disagree with my perspective on any of these things, that's fine, but I took a long time to reach them, and a lot of consideration, and there's really not much point in trying to persuade me (nor am I trying to pursuade you. I'm just answering the question.)
I am up for answering followup questions if anyone's concerned about mechanics etc.
We have a black guy as president. That simply would not have happened even 20 years ago. At protests, even relatively minor nastiness by police is filmed and broadcast immediately. Look up what the police did in some places in the 60ies as a comparison. We have the internet to get information out about various things.
It's easy to see and complain about the bad things, and right to do so, or else they wouldn't improve. It's also worth considering though, that things have improved in many ways.
> Chile for instance, has a culture that is more instinctively capitalist.
I don't know much about Chile, but didn't they vote in a guy who was more or less a communist in the 70ies? Who was then murdered, along with many people, by a brutal dictator, who put in place many capitalist institutions? Which do turn out to work better than the alternative in many cases, so they've been kept? I don't know what the average 'man on the street's view of the whole thing is though. Is it possible the capitalism was kind of foisted on the country and has stuck because it more or less works, but that it's not all that ingrained into the culture? I have no idea, honestly, but do think the Startup Chile thing is pretty cool even if they didn't accept me.
It's worth mentioning that the CIA did everything they could to prevent that "communist guy" from being elected and govern peacefully, and once his government was overthrown it offered all its support to that "brutal dictator", by their own admittance https://www.cia.gov/library/reports/general-reports-1/chile/....
They actually have seemed to pick fairly sensible, middle of the road type of people after having ditched Pinochet, rather than lurching to the other extreme.
It seems like a country that's doing pretty well, but I honestly have no idea what things are like 'on the ground'.
My comment was tongue in cheek. However, I did think the GP's comment about Chile being "instinctively capitalist" was a bit ridiculous considering the country's history.
I completely agree with everything you've said, and that's why I'm doing the same thing. My girlfriend is German so I was thinking of trying for a residency permit there next year. You mentioned the government wasn't supportive; do you have any anecdotes on the difficulty (or otherwise) of getting a short-term German residency permit?
Thanks for the link. I'm not trying to start a business though, I've happily self-employed with my own website for a few years now. (Though not earning the 60,000 euros suggested by that link.) I'm mainly just looking for a residency permit... i.e., I'm not going to work in Germany, I just don't want immigration getting angry when I try to leave ~12 months later.
The netherlands and america have a treaty called the Ducth American Friendship Treaty. Under it, you can get residency in the Netherlands by putting something like 10-12k Euros into a bank (or starting a business with that much value, you'd need a lawyer to navigate the details.) At any rate, as an american citizen you have a sort of inroads to getting residency in the Netherlands. Under this treaty, so long as you maintain that business in the netherlands you can be a resident (and you can work towards citizenship if you were so inclined.)
As a resident of the netherlands, you can live and work in germany visa free because it is part of the free trade zone. I am pretty sure this is the case, but again, I'm not a lawyer and haven't run this idea by a lawyer.
But that's one option that might work for you.
If you'd like to keep in contact with me, I'm interested in corresponding with people doing these kinds of global startup adventures because there's always tips we can share with each other. (Email and twitter in my profile.)
It made sense for entrepreneurs to leave the U.S. since 2003 (when I moved my family of 5 to Vienna Austria), so it's already too late (not so easy to renounce US Citizenship now, new draconian financial reporting laws for expats and new laws which prevent taking assets out of the country kick in 2013).
In 2013 I will renounce my US Citizenship to gain Austrian Citizenship. I have thought long and hard about this. I am proud of the principles the US was founded on, which are trampled on each and every day in Congress, by the President, and in the Supreme Court. I am proud of those who sacrificed for the good of our country, who sacrificed to preserve those rights and to bestow them on me upon my birth. Those sacrifices are dishonored and spit upon daily by our politicians, and their kleptocrat corporate owners.
I will always love the United States, and the majority of it's honorable, kind, and caring people. However I have no love of this totalitarian nightmare which is our government.
Our government is illegitimate, despicable, and dishonorable.
"But when a long train of abuses and usurpations, pursuing invariably the same object, evinces a design to reduce them under absolute despotism, it is their right, it is their duty to throw off such government and provide new guards for their future security."
People don't talk that way anymore.
Beautiful, huh?
- No idea what you said. - It means, if there's something wrong, those who have the ability to take action have the responsibility to take action. "
National Treasure - 2004
"Because you are the president of USA, sir. Whether it is to your character ... Of the oath that you have taken To the Constitution to protect. Of the weight of history That rests on your shoulders. I believe you Are an honorable man, sir.
Gates, that sort of thing People do not believe anymore.
They want to believe in it."
National Treasure Book of Secrets - 2007
Getting a VISA in Austria is straightforward, and Vienna is the best city in the world for quality of life (Mercer 2009, 2010, 2011).
It made sense for Entrepreneurial US Citizens to leave the U.S. since 2003 (when I moved my family of 5 to Vienna Austria), so it's already too late (not so easy to renounce US Citizenship now, new draconian financial reporting laws for expats and new laws which prevent taking assets out of the country kick in 2013).
In 2013 I will renounce my US Citizenship to gain Austrian Citizenship. I have thought long and hard about this. I am proud of the principles the US was founded on, which are trampled on each and every day in Congress, by the President, and in the Supreme Court. I am proud of those who sacrificed for the good of our country, who sacrificed to preserve those rights and to bestow them on me upon my birth. Those sacrifices are dishonored and spit upon daily by our politicians, and their kleptocrat corporate owners.
I will always love the United States, and the majority of it's honorable, kind, and caring people. However I have no love of this totalitarian nightmare which is our government.
Our government is illegitimate, despicable, and dishonorable.
"But when a long train of abuses and usurpations, pursuing invariably the same object, evinces a design to reduce them under absolute despotism, it is their right, it is their duty to throw off such government and provide new guards for their future security."
People don't talk that way anymore.
Beautiful, huh?
- No idea what you said. - It means, if there's something wrong, those who have the ability to take action have the responsibility to take action. "
National Treasure - 2004
"Because you are the president of USA, sir. Whether it is to your character ... Of the oath that you have taken To the Constitution to protect. Of the weight of history That rests on your shoulders. I believe you Are an honorable man, sir.
Gates, that sort of thing People do not believe anymore.
They want to believe in it."
National Treasure Book of Secrets - 2007
Getting a VISA in Austria is straightforward, and Vienna is the best city in the world for quality of life (Mercer 2009, 2010, 2011).
"Also, I've studied economics and been watching the economic situation. I've come to understand the real nature of the federal reserve and the fiat currency of the USA. The USA benefited greatly from Bretton Woods alls these decades, but a side effect of that is that the inflation that has existed in the dollar supply has been exported to other countries, giving americans an artificially better standard of living. This in itself is not bad, but it and our debtor economy are dependent on that money being kept out of the system by being locked up in vaults and pocketbooks and accounts of foreigners who want it because they think the dollar is a strong currency. Given the fact that our economy is faltering, but more importantly our government is spending like crazy (obama is worse than bush who was worse than clinton who was worse than bush who was worse than the very bad reagan who was worse than carter, it just goes on...) eventually they are going to be inflating so fast that the dollar loses its reserve status, and at that point, it won't matter that the US government is inflating because people will start dumping their dollars. We'll start seeing the effect of all those previous years inflation that was exported realized in the dollars in a rather short time. This is not a black swan event, it happens regularly, just not often enough that people remember its possible. But because of bretton woods, it will be much worse for the usa than, say, argentina."
This entire paragraph is horseshit and is what happens when your knowledge of economics comes from reading random shit on the internet. I'd start to tell you why you are wrong but it's so far from the truth it's "not even wrong."
Sorry kevinqualters but it sounds like you need to spend some time researching what he brought up before you call it horseshit. You had no specific examples why it's wrong because, well, obviously you don't know what actually is right.
But trust me, like you, I sure would prefer he were wrong...
That sure looks like a straight forward question, but it actually isn't. Business is an abstraction. We do the work we need to do wherever we are, but the business lives elsewhere, while our primary market is global, such that one of the countries with our largest sales (prior to recent pivot) is a country we've never visited.
I guess : The company pays tax wherever it is domiciled - and that's a matter of corporate tax rates, money transfer restrictions, and other red tape.
On a personal basis, it makes a huge difference whether one is a US citizen (where you have to pay the USA on the first $80k of your worldwide income, whether you are in the US or elsewhere) or not (most countries only tax you when you are tax resident).
For those not caught in the worldwide income trap, most countries only clock you in as a tax resident if you're there for more than 180 days in a year. If one can happily move on every 5 months (eg: Summer in France, 'Winter' in Chile, plus a couple of spare month's vacation) - then one can live tax-free legally...
Edit: Same reporter! This is hilarious.
http://www.inc.com/magazine/201106/doing-business-in-argenti...