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Entrepreneurship

Are European startups solving real problems?

Startup investment in Europe is still under the spell of the US logic. What if startups were not about online pizza deliveries or throw-away scooters clogging our street?

Cover is a startup I’ve been following for quite a while. It’s based in Los Angeles and its job is straightforward:

We design, permit, manufacture, and install beautiful backyard homes in Los Angeles. Completely custom to your property, no subcontractors to deal with, and with a fixed price contract. 

cover.build

A few years we would have probably labeled them Real-Estate 2.0, which would have entirely missed the point because they’re not a tech company.

You might be fooled because they’ve developed an online geo-zoning diagnostics platform, have a 3D construction simulator, and automated permitting with city officials. They seem to have drawn a line at 3D-printing their modular construction. For now.

But it doesn’t matter.

It doesn’t because they are doing something way more exciting than being online and dealing within cumbersome processes with common sense.

They solve a fucking problem.

Now ask yourself: where are the other startups that are solving real problems? Where are the startups NOT involved in pizza deliveries, online baby shower parties, or getting a weekly freshly ground coffee subscription? Where are the investors not myopically focused on MRR and leveraging every bit of lame network effect? How many startups are fighting debt and impoverishment, decent housing, obesity epidemics, or workplace discriminations?

And make no mistake, this question is not about private investment, but public innovation money and our vision about the roles of startups. And there are two camps facing off on that matter:

  • The US vision where startups are speculative endeavors that will possibly create jobs as a net social positive.
  • The European vision where startups…

Wait, there’s no real vision in Europe right? Well, of course we say AI and deep tech now, but we’re not talking problems are we? Just tech.

If in doubt, take any potential real problem to solve, like urbanism. Well, the Uber & Lyft of the world are still spoon feeding us “microbility” while we forget that we have several regional markets that have cracked 30 years ago how city can get reorganized for better living.

This is called buses and bikes. You’re welcome.

Europe know how to crack real problems, where are the startups leveraging these know-hows Internationally?

So, what do we do about this in 2020? How do we go back to real (hard) problems and invest public money accordingly? We know that “just” training elite AI engineers that will get eventually poached by Google or Palantir is not an option.

Do we?

By Philippe Méda

Philippe has been training about 200 startups a year since 2007, consulted for dozens of multinationals on rupture innovation or corporate incubation. He also teaches innovation in key MBA programs in Paris and Shanghai.