Traditionally Austria has many problems with founding of startups. In particular the culture does not embrace failure, the social security net is ridiculously tight and rewards people who do not work a bit too much, the taxes are high and the rules and regulations are strict. None of that is new however.
What is new is that for the first time in a long time this has been acknowledged as a problem and it would appear that the ones in charge are genuine about wanting to change this.
Taxation wise I think it would be nice to improve things a bit but if you do the math a fully insured person in California will have to deliver a similar percentage of their income to the state so I think this is mostly a marketing problem than an actual issue.
We will see how this goes. In the last few years many of my friends and collegues when to the states and I really wish that some of that talent will eventually come back. There is a lot that is wrong in Austria but the quality of living is great and at one point in life this matters a lot.
Why would this be a problem for startups? Demand for low-wage labor (i.e. people for whom the social safety net yields similar quality of life to the jobs they can access) is certainly a hallmark of traditional small businesses but does not seem particularly common among startups.
Apart from missing venture capital, the biggest hurdle for a flurishing startup ecosystem is of a cultural nature. Failure is still somewhat of a taboo in Austria. Risk aversity is taught from an early age on in most households.
That being said, things are starting to move a little. Small hubs develop around universities in Vienna/Graz/Linz, with regular meetups for networking. Much of it is in its infancy, and attending those events sometimes feels like being in a badly acted version of Silicon Valley. But it's still better than not having them.
I live in Austria, founded (and sold) a company years ago and have invested in 2 startups (6 figure each) - and I believe this is a misleading PR article. Austria has lackluster, under-funded universities, unattractive tax rules for companies and higher-paid employees and the country is dropping in most competitiveness, growth rankings that matter for startups. Infrastructure is good, but hiring good developers e.g. is very difficult because salaries are both low and burdened with high taxation, so they look elsewhere.
Personally, I wouldn't found another company in Austria. There are many better places in the EU, Ireland is probably the best option right now.
> Austria has lackluster, under-funded universities, unattractive tax rules for companies and higher-paid employees and the country is dropping in most competitiveness, growth rankings that matter for startups.
Correct. However I think the hope of many here is that it's going to change now.
True. Here is the thing that works well in Austria: the ramen stage. The standard of living you can have on little income is phenomenal. Hardly a country like it. The trick is to keep all the capital in the company, pay the 25% corporate income tax, and only cash out once you made it. Total taxes will still be in the 50% range but if you fail you will still have had a nice ride.
Hiring people in Austria is another issue. Part of the high standard of living is all the employee protections. E.g. by US standards there is an ungodly amount of holidays. If you are a core team of founders or hire people remotely this can be mitigated.
Actually counter intuitive why Austrians tend to be more risk adverse. It's really a mental block rather than a systemic issue.
If you live in Vienna you do however get to enjoy the highest quality of life in the world [1]. And not just this year either. Vienna has kept the title as the best city to live in for several years. Also, you don't have to pay hundreds of thousands of $ to send your kids to college.
Speak for yourself. Some people are happy to pay high income taxes in return for stability, good schools and health care and a (more) equitable society.
Taxes aren't as bad as you make them out to be (the system is progressive), and I believe the benefits far outweigh the costs. Free higher education (university) for example, or excellent healthcare.
Vienna! ha ha ha. You better have some VC if you want to afford that kaffe. I was there for a few days earlier this year & felt like I was getting fleeced at every turn.
What is the point? About 30 minutes drive you come to Bratislava. They have the Euro, they have the more affordable everything.. including old slavic roots who kick some serious butt at everything programming & math related.
Was it just garden-variety tourist fleecing, or did you head outside the city centre? Vienna's definitely pricier than Bratislava and Brno, but I've never found it to be outrageous. Also since both of those cities are so close I don't think it's out of the question to be based in either and seek funding/investment in Vienna is it?
I can't remember who said it, but I remember someone saying there was one question you should ask yourself when reading any news story... Why am I reading about this now? In other words, for what purposes is this story being shared right now?
I'm not suggesting there's a conspiracy behind every story, and there are often benign explanations that can coexist with dramatic ones. What I am suggesting is that question is a vital one for seeing through media spin, regardless of whether it's intentional or unintentional.
[+] [-] the_mitsuhiko|9 years ago|reply
What is new is that for the first time in a long time this has been acknowledged as a problem and it would appear that the ones in charge are genuine about wanting to change this.
Taxation wise I think it would be nice to improve things a bit but if you do the math a fully insured person in California will have to deliver a similar percentage of their income to the state so I think this is mostly a marketing problem than an actual issue.
We will see how this goes. In the last few years many of my friends and collegues when to the states and I really wish that some of that talent will eventually come back. There is a lot that is wrong in Austria but the quality of living is great and at one point in life this matters a lot.
[+] [-] curiouslurker|9 years ago|reply
Arnold's 6 Rules for Success: https://www.youtube.com/watch?v=2RQO_OoNASU
Surely it can't have been too bad for him!
[+] [-] superuser2|9 years ago|reply
Why would this be a problem for startups? Demand for low-wage labor (i.e. people for whom the social safety net yields similar quality of life to the jobs they can access) is certainly a hallmark of traditional small businesses but does not seem particularly common among startups.
[+] [-] badlogic|9 years ago|reply
That being said, things are starting to move a little. Small hubs develop around universities in Vienna/Graz/Linz, with regular meetups for networking. Much of it is in its infancy, and attending those events sometimes feels like being in a badly acted version of Silicon Valley. But it's still better than not having them.
[+] [-] lazyjones|9 years ago|reply
Personally, I wouldn't found another company in Austria. There are many better places in the EU, Ireland is probably the best option right now.
[+] [-] the_mitsuhiko|9 years ago|reply
Correct. However I think the hope of many here is that it's going to change now.
[+] [-] geff82|9 years ago|reply
[+] [-] stefanix|9 years ago|reply
Hiring people in Austria is another issue. Part of the high standard of living is all the employee protections. E.g. by US standards there is an ungodly amount of holidays. If you are a core team of founders or hire people remotely this can be mitigated.
Actually counter intuitive why Austrians tend to be more risk adverse. It's really a mental block rather than a systemic issue.
[+] [-] mherrmann|9 years ago|reply
1: https://www.theguardian.com/business/2016/feb/23/vienna-name...
[+] [-] loevborg|9 years ago|reply
[+] [-] ckastner|9 years ago|reply
[+] [-] geff82|9 years ago|reply
[+] [-] codecamper|9 years ago|reply
What is the point? About 30 minutes drive you come to Bratislava. They have the Euro, they have the more affordable everything.. including old slavic roots who kick some serious butt at everything programming & math related.
Nice parks though.
[+] [-] smcl|9 years ago|reply
[+] [-] the_mitsuhiko|9 years ago|reply
On what? I never noticed Vienna as an expensive place for anything other than maybe housing.
[+] [-] kbody|9 years ago|reply
[+] [-] ZenoArrow|9 years ago|reply
I'm not suggesting there's a conspiracy behind every story, and there are often benign explanations that can coexist with dramatic ones. What I am suggesting is that question is a vital one for seeing through media spin, regardless of whether it's intentional or unintentional.
[+] [-] jkot|9 years ago|reply
[+] [-] atmosx|9 years ago|reply
I studied in Brno and I have friends working at AT&T and IBM. They even have a ruby group meetup.. But a startup hub??? No.
[+] [-] codecamper|9 years ago|reply