It’s all about Talent, Talent, Talent
Next to markets and capital, talent has always been one of the top three things entrepreneurs need to thrive. With more capital available and markets slowly uniting, access to talent is becoming the biggest bottleneck to scaling up in the EU. We suggest three building blocks to policy makers: Train more talent, enable startups to hire the talent they need and allow founders to reward talent properly. Here’s what it exactly means, how it accelerates Europe’s growth and why now is the right time.
Not one “Talent Button”
Startup leaders have repeatedly told policy makers: Talent is the biggest bottleneck. But what can governments do to turn the call into reality? Enabling talent isn’t solved with one single solution. Rather, an interplay of multiple measures is needed. We suggest to look at three stages or avenues that policy makers can pursue to boost startup success.
Training: Much talent is lost simply because it never got a proper chance to participate. Digital literacy for the current and next generation is the basis for a strong pool of talent in the EU. One way is to teach coding in primary schools, to refugees or everyone. It shows. Estonia is a powerful example. Training talent doesn’t stop with coding. STEM disciplines are important and complex problem solving more generally. Growth, sales, multitasking and getting s***t done are high up right with data science and developing. For many of the jobs we need today there are no curricula and certificates so openness towards for non-formal and informal education is needed.
Access: If talent isn’t available where the startup is, mobility becomes key. The time and administrative effort it takes to hire talent from abroad can become a competitive disadvantage for growing companies. While a visa for founders and early employees alone will not make startups succeed, the will allow them to grow at the ideal speed where they want to be. There are many examples within the EU. For instance, the French Tech Visa let’s users compete among themselves in making processes simpler and faster. But we’re still lacking a unified European Startup Visa.
Attraction & Retention: The war for talent is real and even more so for young startups with unproven business models. Without tons of cash established brands and livelong perks, employee stock options are one of the main ways for startups to compete in the war for talent. However, rules on stock options are nightmarish and punitive across Europe and hence need a overhaul. Not Optional, a campaign driven by leading entrepreneurs in Europe, makes the case emphatically.
Haven’t we heard this before?
Yes we did, often enough. Access to talent is a top priority for Allied for Startups since inception. In 2016 we pitched the European startup visa, outlining how it would help turn the brain drain into a brain-gain. The Scaleup Manifesto dedicated a whole chapter to talent — as did many manifestos. We’ve reiterated our call to the European Commission earlier this year.
Why are 30+ of Europe’s most successful entrepreneurs right to ask for it again? Why should we look at this now? Primarily because it hasn’t been solved. The fact that over a dozen EU countries have their own version of a startup visa and rules on stock options are “archaic and highly ineffective” shows that something needs to be done.
Secondly, it’s urgent! Startups plan to create over 100,000 jobs next year, and talent is scarce. As Europe’s startup ecosystem matures and more capital is available, we’ve never been more successful in building world class tech companies. While talent has always been a top priority, it now risks becoming a dangerous bottleneck for growth and success. Without the right talent, companies are forces to offshore, outsource and eventually move.
Thirdly, ahead of the 2019 EU elections ideas on developing Europe’s success are welcome. Again, none of these ideas are new, but many stars have to be aligned for the political sausage-making to produce results.
Global competitiveness is relevant too. As Europe hasn’t quite found it’s spot between massive investments, government intervention or a regulatory wild west in other regions, betting on being the best place for tech talent could also become part of the Union’s unique DNA for tech.
In absence of one single EU-wide entity, politician or legislation to address this, we believe it is the right time to build a consensus across Member States to drive these points home. Let 2019 be the year of talent!