The plane was in that tense state just before the captain starts taxiing. I gripped my seat – I knew that most plane crashes happen on take-off or on landing. Then there was that bump, and the plane started moving down the runway. First gently, then it roared to life and raced down the runway. I held on the seat tighter, watching the airport buildings jump past. Little men in bright green mechanic suits moved briskly about, efficiently making sure that nothing went wrong at this airport.
I was leaving all this behind – this engineering efficiency, this orderliness, this sanity. As the plane jumped into the air, my heart dropped and my eyes struggled to hold on to some part of this place. Then the wing came between me and the ground and that quick silence fell over the plane – the silence that means you are no longer leaving, you have now left.
Hong Kong would be the next stop.
I was sitting in the Airbus A380. The largest airplane in the world, built in Europe by european engineers. A technical marvel that could have been built almost nowhere in the world apart from Europe or the U.S. Why would I leave the place with such a high engineering standard for a place that is still the wild west of engineering?
Because life in China is like living in a startup and life in Europe is like being in a big company.
Europe, and in particular Germany is a very controlled place. There is a ministry that is responsible for everything – from registering your company through declaring your profits, there are a large number of rules and regulations that you need to know about, and they will come down hard on you if you get them wrong.
These rules are also very difficult to discover and very difficult to implement correctly. From the situation with healthcare for your employees through to filing your taxes correctly, the amount of paperwork is insane and complex.
There are so many little ‘unfreedoms’ in europe that seems insignificant, but together they add up to a society that advocates safety over freedom. All these rules and regulations are there to protect people from harming themselves, but the end result is a nice, peaceful society in which you have several well regulated ways to bore yourself.
For example, a friend of mine was hired in a company to do some advertisment work. It was manual labour – just stand at the side of the road and hand out flyers to people. The problem was that the person running the company was constantly contacting her privately, calling her at night, and then when she was done, he delayed her payment for weeks.
She waited for a long time, and when she finally got her money, she went online to some review forum for such services and wrote a long and scathing review about the company. A few days later, she received a letter from a lawyer informing her she was being sued for defamation, and she should delete her review and pay the lawyer costs, which came to 600€. She had to.
That’s the effect of all these regulations – they prevent you from stepping out of line. If you stick to simply working in a company and doing things the regulated way, you’ll be fine, but once you start trying to go a different way, you’ll discover that there are a very wide array of rules that come together to discourage this.
But I don’t want to focus on the negative, rather, I’d like to speak about how china offers a completely different and more free experience compared to europe.
Starting up in china
- Programmers: This is the number one concern. In europe, programmers are very expensive. A good programmer will expect to receive at least what he would receive in a big company, or he would want a chunk of your company. That’s 5000€ in costs a month for a single programmer. Additionally, you cannot fire him. The programmers in europe are also interested in staying for years with companies – when your company is in its starting stage and you don’t even know it will be existing in a few months, it’s difficult to attract good talent.
In china, you can pay a programmer 600€ a month, you can fire him with one months notice, and you have a wide pool of qualified people leaving university which you can always pick from. The chinese university system means that people who complete such a degree are intelligent and hardworking. The work ethic is high – a 6 day work-week is not unusual.
Also, in china people are more willing to travel around to find an appropriate job than in Europe. So you can source from a huge population of programmers all over the country.
Quite apart from the chinese programmers, it’s also easier to get foreign programmers to work for you in china than in europe. It’s easy to get a chinese visa for a skilled indian programmer – but try doing so in europe. It’s very, very difficult as a small startup, and when the programmers arrive, there are a huge number of secondary costs.
And also, foreign programmers have a tendency not to stay in germany – whereas in china and other parts of south east asia people are generally friendly towards foreigners, in Germany and many parts of central europe there is a generally negative attitude towards people who don’t speak the language and are there to work.
It’s even easier to get American programmers in china than in europe, because many american programmers come to china for the adventure, but would not do the same to europe.
- Costs: Starting up in shenzhen is not the cheapest place to startup in. But it’s still way, way cheaper than in europe. Your daily food expenses are way lower, travel is way lower, and most importantly, the cost of staff is much, much lower. Rent is not significantly lower, both for private apartments and for the office.
Important is that there are very low additional costs paid to the government. In Europe, you could pay 1/3 – 1/2 of your profits as a small company just servicing the goverment, China does not require this.
- Comfort and fun. China is much more comfortable than Europe if you have money. You can get a nicer apartment, travel better, and in the evenings you can eat in nicer places. You can also go for massages, pay less for your gym.
If you want to go on holiday, you can travel cheaply to nearby exotic places like bali, thailand, mongolia, japan or russia. The standard europe travel destinations are less dramatically interesting than those places.
Renting and living is easy in china – it’s easy to find a place to stay in. In big european cities, you need to prove income and there is a lot of competition for the nice places. And depending on if you look respectable or not (don’t be a 24 year old grubby male), it can be quite hard.
- Expanding and growing business. In china, particularly south china, there is a lot of opportunity. All the hardware manufacturers are there, and you can easily source all the hardware you need. Chinese people are interested in doing business, and in expanding their social contacts. European business people are more aloof.
And the other way round – if you need to shut down your company, you can simply fire everyone without ending up with a bunch of lawsuits.
That’s basically why I’m giving up on Europe and choosing china to grow my business. Europe is regulated, controlling, and boring, where china is dynamic, fun, flexible and cheap.
If you're interested in technology & startups, then follow me on my low volume twitter account
China and Europe sound like two polar extremes. Where does the US fit in there?
It's interesting that nowhere in your article have you talked about the downsides of being fired with little warning.
I’d love to hear some about the impacts of the language barrier.
Good luck with your startup!
By the way, what's with government regulations and censorship?
If you pay peanuts, you get monkeys.
Yeah, hope you don't need a surgery in China plus I am glad you are happy to finance a communist regime
.
Sounds great, but what about the chicks?
Hi,
nice article, let me say! How's it w/ retention in China? Could you (or anyone else) compare to India? Thanks.
You know – I'm a liberal, I'm a freelancer, I despise the nanny state and German conservatism. I should be on your side.
But I'm not.
All I read from your self-congratulatory positing is this: "Why stay in a boring democratic country? In Cina, I can get CODING SLAVES! I can fire them whenever I chose! And the living is cheap! Here, I'm a GOD! And now, let's get a massage for five bucks, and fire that lazy coder tomorrow morning!"
I don't know how old you are. 25? If so: At your age, I would have applauded and possibly followed you.
But there are a few details missing here.
The German nanny state, with all its boring attention to details, protects employers and employees. It wants no bribes. It ensures that if you run your business properly, it can operate safely and effectively. It ensures that if your business partners f*ck you, you can go to court. Your taxes (which, of course, are way too high, but they always are) give you access to an excellent infrastructure. Most of the time (of course, not always), intellectual property is appreciated and protected. You get to enjoy freedom of speech, online and offline.
None of this may be important to you if your only concern is getting a company off the ground. In that case, having access to hundreds of thousands of people who have no choice but do what you and other business men want has to be like a real-world God Game, with you at the joystick day and night.
If that's your thing, and if you don't mind being secretly laughed at both by Europeans the Chinese – go ahead. Have fun. Become rich, or die trying.
Just don't portrait yourself as a daring, curious explorer going into the wilderness.
You are just a Manchester style capitalist setting up shop at the most reactionary place in the world, where human beings are just a commodity; like electric power or water. Good for you.
Also, I just read your posting on Nick Vujicic ("If a man without arms or legs could make a million bucks, why can’t you?"), and it makes me want to vomit. You see a man in a terrible situation, with a great, motivational story to tell, and all you see is A MILLION BUCKS.
Look at yourself in the mirror. Look at that piece you wrote, especially the headline.
How can you live with yourself?
Well – I guess in China it doesn't make that much of a difference.
Petko, you didn't mention another important benefit of Bulgaria. Your girls are just awesome!
yeah, this adds up!
)
Good luck with that freedom in China…
“Chinese people are interested in doing business, and in expanding their social contacts.”
Interesting. What sort of business are we talking?
Programmers, its hard to find good ones. With a lot of intelligent and hard working people, a ton of the opposite comes with them.
600€ per month? It looks like Portugal is Europe's China
+1
Have you considered Singapore, Max?
How easy/difficult is it to get a visa/work permit for Shenzhen for an European?
Awesome comment!
Best comment EVERRRR!
你在深圳？我想跟你聊聊
I don't agree with a single word you said in this article, but I wish you good luck nonetheless.
Interesting post. Recently I've been pondering opening a company in the British Virgin Islands just to get rid of the bureaucratic burden of paying an accountant several hundred euros per month just to process a couple of invoices.
I agree with David_Winter, and from my own experience (I'm from Germany, living in Guangzhou for 6 yrs, having had a software dev team in GZ for few years): you can tell from the article that it's written by a startup guy doing small scale business and not yet having had the break through, no offense intended, but it really reads like that. I agree with some of your points of view (esp. about Germany – I also have no intention to ever go back to Europe), however, the benefits of the Chinese work force is exaggerated. Chinese graduates might be trying hard to get the work done, but they really remain *trying*, ad compare that to a German graduate, also compare the quality. Speed, accuracy and quality differ immensely. And if you're doing a lot of oversea projects (English required verbally and in writing), it's hard to find developers who are able to communicate well (without you needing to be in the middle and playing the interpreter all the time) and are also good in coding at the same time. So far, all graduates I've seen, have almost no practical experience in coding, never done any side jobs beside their studies. Of course you will find good developers in China, but on the other hand, at least from my experience, most developers are looking to work in a large company, not in a small startup. If they do, they only plan to stay for a short term in order to being able to claim that they have worked for a foreign company, not bad for their CV
What you described is therefore actually a disadvantage, you want people to stay long-term, not those who are job-hopping on a regular basis. Otherwise your initial attitude towards your own startup really seems as if you're over-cautious and anxious that it might fail already.