🚀 Why Europe’s VC Mindset Is Holding Startups Back
75% of VCs don’t return a profit. Here’s how training, mindset shifts, and founder bravery can change that — for good.
✨ Why This Matters
Imagine launching a killer startup in Europe—solid product, hungry team, early traction. But once you reach Series A, the air thins. Local funds get cautious. Growth slows. You either raise from abroad or stall.
That’s not a founder failure. That’s a VC failure. And it’s systemic.
This post dives into why most European venture capital (VC) firms still struggle to scale startups, what the U.S. gets right, and how one model—investor education at scale—could fix it.
🚀 75% of VC Funds Don’t Deliver Returns
According to Andy Goldstein, Managing Director Europe at VU Venture Partners, a staggering 75% of VC funds never generate a carry. That means no real return for investors, no scaling capital for startups, and no second chances.
Why? Most VCs are trained on the job. With LP money. And without guardrails.
VU Venture Partners is flipping that. Their "Investor Accelerator" program trains 40–60 new investors per quarter. Each fellow:
Reviews 100+ deals
Attends every partner and investment committee meeting
Gains exposure to 20,000+ opportunities annually
And yes, they actually invest.
🌐 Europe vs. U.S.: Why Founders Feel the Drag
Goldstein’s blunt insight? "Europe still has a stage problem."
U.S. investors are increasingly stage-agnostic. They write checks when they see potential—not just when a startup fits a checklist. In Europe, investors stick rigidly to rounds. "Too early." "Too late."
But startups don’t grow in neat stage boxes.
This lack of flexibility delays funding. It also discourages bold moves—like early international expansion or aggressive hiring. And that leads us to a bigger pattern.
🚀 This episode is brought to you by Tide.co
Managing finances as a freelancer or small business owner can be overwhelming – but it doesn’t have to be.
With Tide’s free business account, you get everything you need in one place: send invoices, track expenses, and handle taxes with smart tools built to save you time and stress. Plus, when you sign up with the code STARTUPRADIO, you’ll get €200 cashback after spending €500 as a sole trader, or €400 after €1,000 as a registered business.
Don’t miss out – sign up now at tide.co/Podcastsde – use code STARTUPRADIO
🚤 German Startups: Big Market, Small Mindset
Why do Israeli startups go global from Day 1, while German ones wait?
Necessity. Israel’s market is tiny. Germany’s isn’t.
But that strength becomes a trap. German founders can build sustainable businesses locally. But if they delay going global, they risk:
Missing first-mover advantages
Losing category leadership
Becoming too customized for one geography
The solution? Adopt a "born global" mindset early — like the one encouraged in the German Accelerator, which Andy co-founded.
🤖 AI Can Help Founders Sell (and Scale)
Sales remains a blind spot in the DACH startup ecosystem. Cultural discomfort, perfectionism, and engineering bias get in the way.
Goldstein offers a fix: leverage AI for sales focus. Use tools that:
Score and prioritize leads
Automate follow-ups
Flag buyers vs. browsers
Founders need to stop seeing sales as sleazy. It’s just storytelling—done with conviction.
📊 What Makes the Top 1% of Founders Different?
Andy highlights three traits that separate the great from the good:
A drastically better solution — not incremental, but transformative.
Massive addressable market — big enough to absorb mistakes.
Simplicity in messaging — like Venmo’s pitch: "Send money with a phone number."
Great founders are obsessed, focused, and bold. They don’t wait for permission.
📍 Where This All Comes Together
If Europe wants to scale startups globally, it needs:
Trained investors, not just operators
VCs who think in returns, not checklists
Founders who embrace discomfort
Government and ecosystem programs that encourage early internationalization
This isn’t theory. It’s what VU Venture Partners and the German Accelerator are already doing.
🔊 The Video Podcast
Will go live on Thursday, May 22nd 2025. Available earlier for channel members.
🎧 The Audio Podcast
You can subscribe to our podcasts here. Find our podcast on your favorite podcasting app or platform. Here are some of the links to subscribe.
📄 Further Reading
Supplementary: Startup Investor Education in Europe [coming soon]
Supplementary: Scaling a B2B SaaS Startup in Europe [coming soon]
🛎️ Let’s Talk
What’s the one thing you think is missing in Europe’s startup investment ecosystem?
Comment below or reply to this email. We’ll feature top insights in our next issue.
Want more insights like this? Subscribe, share, and forward this to one smart founder in your network.