Historically, extraordinary talent gravitates toward extraordinary talent.
At the very beginning of the 15th century, an extraordinary group of young artists and intellectuals, formed under the patronage of the Medici family, flocked to Florence. Thus began the Renaissance, which later spread to Rome, Venice and the rest of the country.
During the early 1900s, Paris became a literary mecca. Its Quartier Latin on the 5eme Arrondisement became the adopted home of America’s postwar Lost Generation – the group of literary expatriates hosted by Gertrude Stein that included, among others, Ernest Hemingway, F. Scott Fitzgerald and T. S. Eliot.
Now, entrepreneurs gravitate toward other entrepreneurs.
Our tech Mecca in the West has always been and, to a degree, still is Silicon Valley. But thanks to the astronomical cost of living, an impenetrable immigration process and the rise of other tech hubs, the Valley is slowly losing its mojo.
I believe Europe is perfectly positioned to take on the Valley and should create a continent-wide European Tech visa for startup founders and employees to capitalize on these historical forces.
Why the European Tech Visa should exist
1) Tech entrepreneurship has an outsized impact, enough to drive entire economies.
Of the currently public U.S. companies founded between 1979 and 2013, 43%, are VC-backed tech companies. These companies comprise 57% of the market cap, 82% of the total R&D expenditure and 38% of the employees of all public companies founded after 1979.
There are thousands of entrepreneurs looking for a politically stable climate and a favorable economic environment to set up their company.
High-skilled immigrants are a net positive for any economy, and as countries like Argentina and Turkey are actively driving out their best people, the best are looking for a place to call home.
2) Local European companies are struggling to hire talent.
"There are two dimensions to that. There’s the economic supply-demand part — all the high-growth startups we interviewed pretty unanimously said that hiring was their number one priority and that they were looking for profiles that weren’t readily available in France."
A Tech Visa for Talent will give local companies access to a pool of talent that was previously impossible to tap.
3) Gresham’s Law applied to Talent Markets makes it so that you are either growing (and attracting talent) or decaying (and pushing talent out).
In time, if Good Talent is hoarded somewhere else, Bad Talent will be given more movement and circulation within the Talent Market. As more and more Bad Talent starts to circulate within a market, companies will start hiring that Bad Talent, mostly because this is the only currency being traded.
If Bad Talent is rewarded with a job and power, word will go out and Good Talent will move while Bad Talent will notify gravitates towards whatever they can get.
Enabling talent to gravitate to Europe will create a positive Talent growth loop on the continent, or at least facilitate and maximize positive growth loops on a select number of tech hubs where all talent will flock to.
Why Europe should do it (and not someone else)
1) European Tech is growing at an insane rate.
Total investment in 2018 was €26 billion, comfortably exceeding the €19.6 billion invested in 2017 and now 4.4x up compared to the levels of investment from 2013.
Money is pouring from China and the US, with record-level investments of €14bn this year, up from €8bn last year.
2) Europe is not scary, while China is.
The Asian powerhouse is a capital and talent magnet in the East, but there is a huge cultural barrier that makes it unattractive to people in the West. I'm sure there are South African founders whose dream is to make it Shanghai, but there aren't many.
On the other hand, Europe's familiarity and cultural diversity make it attractive enough to most of the world population. There's something for everyone.
3) Europe is the biggest market with access to the global economy, and a functioning political and economic union that can make this happen.
A few countries like France – La French Tech, Station F, and more – and Estonia know it and make it incredibly easy to immigrate. But that is not enough. And tech won't wait for the rest of the continent to catch up, one country at a time.
The European Union is the only body that can regulate on a regional level with enough speed to make an impact.
The economic and social benefits of becoming a global tech hub are obvious:
- Tech entrepreneurship has an outsized impact on economies
- Local European companies are struggling to hire talent
- Talent follows talent, so you are either growing (and attracting entrepreneurs) or dying (and driving them out)But more importantly, Europe is the only region that can make it happen on a big enough scale because:
- It's already growing like crazy,
- Is attractive for the West,
- And can be regulated on a continent level.