Great point - Unfortunately, it's endemic in European society that bankruptcy should be labelled as a permanent branding of failure for an entrepreneur. Until this year in Ireland, an adjudicated bankrupt could not apply for €630 credit without disclosing his status as a bankrupt (which could last for up to 12 years!)
I'd bet that the countries with the lowest barriers to exiting bankruptcy (eg 6 months in the US) also have the highest start-up success rates.
Bankruptcy laws are inversely proportionate to an innovative start-up ecosystem.
Getting rid of the '040' label is definitely a step in the right direction and I'm delighted to see that Hollande recognizes how important it is to remove this stigma.
On a side note, Liam Boogar, the editor of the Rude Baguette (source of this article) is an absolute gentleman who works tirelessly to better the fate of French start-ups. Keep up the great work!
I'd bet that the countries with the lowest barriers to exiting bankruptcy (eg 6 months in the US) also have the highest start-up success rates.
Perhaps, but someone is still footing the bill for those failures that were able to write off debts they couldn't afford, so I wouldn't be too quick to assume a very liberal culture with regard to bankruptcy is always better.
Remember, bankruptcy doesn't just mean a company failed to make money, it implies that the company ran out of money without even paying its debts. In this context, that usually means taking on a bigger loan than it could afford to repay.
If banks are going to lend more money to businesses run by people who make that mistake, they're probably going to be putting up interest rates on loans across the board to pay for it. That's going to hit other businesses that are borderline successful in their early days instead, possibly even killing them off before they become established and sustainable.
I know it's popular around places like SV and around HN to talk up failure like it's a badge of honour and guarantees you'll have valuable experience to learn from for next time, but a failure is still a failure. Even if most one-time failures shouldn't merit the end of someone's entrepreneurial career, banks should lend responsibly and be hesitant about lending to someone with track record of not repaying their debts.
The flipside of that in anecdotally I've heard that companies that really /should/ die limp along from a long time and get more funding in the US. Is this true or just a myth?
The "zombie company" thing used to happen (in the late 90s), not so much anymore.
Now it seems we have gone to the other extreme, "fail fast" is the slogan of the day. Sometimes companies fail so fast they never get a chance to grow into a success or pivot.
> The flipside of that in anecdotally I've heard that companies that really /should/ die limp along from a long time and get more funding in the US. Is this true or just a myth?
Banks that get bailed out are companies that should have died.
Ford (cars), Disney (media), Lincoln (president), Heinz (condiments), Hershey (candy), Twain (author), Fox (media) -- tons of others...