EU regulations backfire and push fledgling tech startups across the Atlantic

Why is this Startup meme funny?

Level 1: Strict Teacher, Empty Class

Imagine a teacher who makes a lot of strict rules for the classroom. They say, “No talking at all, difficult homework every night, and heavy fines (or extra chores) for any small mistake.” The teacher thinks these rules will create a perfect class. But what happens? All the kids decide, “We don’t want to be in this class anymore,” and they transfer to another teacher’s class where the rules are kinder and they can actually have some fun while learning. Suddenly, that first teacher looks up and the classroom is empty — all the students moved next door! This meme is just like that story. The EU is the strict teacher making tough rules and high “taxes” (like giving a lot of homework or fines). The startups are the students who decide to leave because it’s easier to learn and play in the other class (the US class with a friendlier teacher). It’s funny in a way because the teacher’s big plan completely backfired — they wanted a well-behaved class, but ended up with no class at all. The feeling behind the joke is a mix of “Oh no, that didn’t go as planned!” and a laugh at how sometimes making things too strict just makes everyone run away.

Level 2: Startup Exodus

At its core, this meme contrasts two different environments for startups: Europe (EU) versus the United States (US). In the first two panels, the European Union is making big rules. “Regulate tech and innovation” means the EU creates laws about how tech companies must behave — for example, laws about user privacy, data handling, or how companies can use AI. These rules are often strict to protect people’s rights. Next, “Heavily tax SMB and complicate fundraising” refers to how small and medium-sized businesses (SMBs) in Europe face high taxes and complex processes when they try to get money from investors. Fundraising is how startups get cash to grow (often from venture capital funding or angel investors). In some parts of Europe, if a startup wants to raise money or give shares to new investors, there are lots of forms, regulations, and sometimes limitations on how it can be done. It can be complicated, especially compared to the US, where the process is generally more straightforward and there’s a larger pool of venture capital willing to invest in risky new ideas.

Because of these challenges, the next panels show the result: “Startups move to the US.” This means many European startup founders decide to relocate their company to the United States. Why the US? The US is famous for Silicon Valley (in California) and other tech-friendly regions where investment money is plentiful, regulations for new businesses are lighter, and taxes (especially in certain states) can be lower. The term startup exodus is often used to describe this phenomenon of companies leaving one place for another en masse (exodus means a mass departure). In real life, it’s common to see a promising startup from, say, France or Germany incorporate as a US company or attend an American accelerator program to more easily access funding and partnerships. This is sometimes jokingly called “geographic arbitrage” — basically, choosing the location that gives your business the best advantages.

The meme uses the Gru board presentation format, which is a popular meme template from the movie Despicable Me. In that scene, a character named Gru shows a series of slides. Meme creators use it to set up a plan that goes horribly wrong by the last slide. Here, the EU (represented by Gru with an EU flag pasted on him) proudly presents their plan on the flip chart. But by the third panel, when the policy leads to “Startups move to the US,” Gru is slouching, and by the fourth panel he’s completely defeated realizing he’s just repeated the unwanted outcome. It’s a visual way to say, “the plan backfired.” For a junior developer or someone new to the tech industry, the message is that rules and taxes can shape where companies choose to build their dreams. A place with too many rules (even if meant to do good) might scare away the very innovators you want to keep. This is a frequent talking point in StartupCulture and among entrepreneurs: Where should we base our startup for the best chance of success? The meme humorously sums up one answer to that — if Europe makes it too hard, startups pack their bags for America.

To put it in simpler terms: imagine the EU is trying to guide and control the tech space carefully, but doing so without realizing it might be pushing the brilliant new companies right out the door. The humor comes from that irony and from recognizing a real-world trend portrayed in a silly cartoon format that tech folks share for a laugh (and a bit of a sigh).

Level 3: The Regulatory Boomerang

Europe’s well-intentioned tech regulations and tax policies can sometimes act like a boomerang — they come right back around with unintended consequences. The meme nails this irony: the EU (portrayed by Gru) proudly unveils a plan to “Regulate tech and innovation” and “Heavily tax SMB and complicate fundraising,” expecting to shape a fair, controlled tech industry. However, in the very next panel, the plan backfires spectacularly: startups flee to the US in search of a friendlier ecosystem. This Gru presentation format (a classic Despicable Me meme framework) often highlights plans that self-sabotage, and here it perfectly captures a recurring pattern in the startup world.

Seasoned founders and venture capital veterans recognize this scenario as a commentary on regulatory burden. Europe’s strict laws — from comprehensive data protection rules like GDPR to strong labor regulations — are meant to protect citizens, but they also increase compliance overhead for young companies. A fledgling startup with 5 employees might suddenly need a legal team to navigate EU directives or devote precious time to paperwork instead of coding their product. Likewise, “Heavily tax SMB” refers to high taxes and limited incentives for small-to-medium businesses. Many European countries impose robust corporate taxes and stringent rules even at low revenue, which cut into the runway of a startup. When early-stage companies are burning cash to find product-market fit, every extra expense or delay counts.

Fundraising complications add more fuel to this fire. European startups often report that raising capital can be more complex due to fragmented markets and conservative investment climates. For example, granting employee stock options — a key tool to attract top tech talent — can be tax inefficient or legally convoluted under some EU jurisdictions. And many EU-based venture funds prefer startups to incorporate abroad for simpler exit strategies. As a result, ambitious entrepreneurs practice geographic arbitrage: they register their companies in places like Delaware (a US state famous for business-friendly laws) or physically move to Silicon Valley or other US tech hubs. This transatlantic migration is essentially a startup exodus, a direct consequence of the very policies meant to rein in tech power.

The humor here is that the EU’s “master plan” slideshow ends up advertising the opposite of its intent — it’s as if an attempt to tame innovation ends with “Go West, young startup!” written on the board. Experienced folks in startup culture chuckle (perhaps a bit ruefully) because they’ve seen this movie before: stricter rules often spur the most driven innovators to seek freedom elsewhere. It’s a classic tale of policy impact gone awry. Gru’s stunned, defeated posture in the final panel is basically the EU realizing, “Oops, we just nudged our brightest innovators across the ocean.” In the world of TechIndustryHumor, this meme hits home: the path to StartupLife is already hard, and piling on red tape can inadvertently create a one-way ticket to America. The emotional subtext is both funny and frustrating — funny as a comic exaggeration of bureaucrats outsmarting themselves, and frustrating because it reflects a real hurdle for international entrepreneurs.

Description

Four-panel Gru presentation meme from “Despicable Me.” Panel 1: Gru, overlaid with an EU flag and the caption “EU,” proudly points at a flip-chart reading “Regulate tech and innovation.” Panel 2: Gru, looking downward, gestures to a second slide that says “Heavily tax SMB and complicate fundraising.” Panel 3: Gru slouches while the board now states “Startups move to the US.” Panel 4: Gru, head hanging in defeat, reveals the same slide again: “Startups move to the US.” The visual gag illustrates unintended consequences of stringent European regulation and taxation: early-stage companies relocate to the United States where fundraising and regulatory environments are perceived as friendlier, a frequent discussion point among founders, VCs, and senior engineers weighing jurisdictional trade-offs for scaling tech ventures

Common Tags

StartupCulture StartupLife Startup VentureCapitalFunding TechIndustryHumor TechHumor DeveloperMemes

Comments

100

Anonymous ★ Top Pick Every time Brussels drops another 200-page directive, our founders treat Delaware like we treat us-east-1: not ideal, but all the docs assume you’re there

Anonymous ★ Top Pick

Every time Brussels drops another 200-page directive, our founders treat Delaware like we treat us-east-1: not ideal, but all the docs assume you’re there
Anonymous

The EU's tech strategy is like implementing strict typing in production without a migration plan - sure, it catches errors, but your entire engineering team just migrated to a company that still lets them ship fast and break things
Anonymous

The EU's master plan: regulate innovation so thoroughly that startups optimize their jurisdiction selection algorithm and discover O(1) relocation to the US beats O(n²) compliance overhead. Turns out the real 'exit strategy' wasn't an IPO - it was literally exiting the regulatory jurisdiction. Who knew that when you make the cost function of doing business asymptotically approach infinity, rational actors would simply change their deployment region?
Anonymous

EU regs: the compliance layer that balloons your tech debt faster than any monolith migration
Anonymous

EU keeps adding middleware (GDPR, DSA/DMA, AI Act) and wonders why the workload gets migrated to us-east-1 - just regulatory latency optimization via a Delaware C-corp
Anonymous

Schrems II made data transfers hard; turns out the only export the EU streamlined is our cap table - straight to Delaware via a SAFE and one DocuSign
@Box_of_the_Fox 2y

This also happened before regulations
@Box_of_the_Fox 2y

EU would give money for researchers. Researchers would come up with stuff. US companies would buy researched stuff
@waifu_anton 2y

To be fair, regulations are not always bad. Hello USB-C on iPhone
1. @DavidGarciaCat 2y
  
  Apple has kept its lightning connector for years (no need for a change). This move is only to fuck up Apple and force them to use the same approach as other manufacturers with no real benefits for the user.
  
  @deerspangle 2y
  
  Plenty of benefits to a unified standard, and it forces apple to crack their monopoly. Apple thrives on trying to lock people into the apple ecosystem
  
  @DavidGarciaCat 2y
  
  Apple’s presence in the EU is around 10%. And it's called “ecosystem” for a reason. Ocean mammals can't live outside seawater, but the EU doesn't set a law to rule them out of the water.
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Hell no
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  It’s definitely more
  
  @DavidGarciaCat 2y
  
  It is in the UK, but the EU has a much larger chunk of any Android manufacturer
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Sure there is german and what not android makers but I can assure you in schools and when I go shopping for groceries its like 40-50% iphones
  
  @DavidGarciaCat 2y
  
  🤷‍♂️ maybe that's the exception that confirms the rule?
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  My question is who the source is. Because its way off to my personal “statistics”
  
  dev_meme 2y
  
  33% on phone market, 13% on laptop market, so generally it’s not much - 22-23% maybe
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Okay fair ig there is like only 3 people in my class owning macbooks and one of them even uses a windows machine most of the time. But afaik apple makes most profit on phones
2. dev_meme 2y
  
  Fuck typec, lightning was better all around, that’s a shame that apple missed the opportunity to make lightning open and kill typec nonsense
  
  @callofvoid0 2y
  
  why?
  
  dev_meme 2y
  
  Very bad specs, for example some typec to 3.5mm jack converters would work with this but not with another phone - already found that kind of converter - it’s not even charging! And it works on 1 out of 3 androids, NOICE
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  But thats not even comparable. Usbc is open. Shitty manufacturers will make shitty adapters. Buy the one from Samsung it’s very good. But keep in mind some devices get confused by 320kHz and will default to the lowest bs. Which sounds like radio lol
  
  dev_meme 2y
  
  It’s the shit show from people who make this as standard - they did not think of that kind of application, that’s a FLAW
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Bruh thats a flaw in the OS you are using…
  
  dev_meme 2y
  
  Bruh, that’s a shitty standard if it’s so promiscuous
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  I told you. That’s not the standard’s issue… Its the issue of the OS.
  
  dev_meme 2y
  
  You are talking like a hardware engineer rn
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  This got fixed on that OS in a later update. This bug was due to windows using a driver that is ancient. Do you know how old the USB2.0-Audio driver is?
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Not to mention I think with apple you must use their dac. Where in USB-C you can use Alt mode that routes analog signal from the phone to the port, or you can use any USB-Audio compliant dac.
  
  dev_meme 2y
  
  That’s a DAC and I used third party Lighting DAC no issues, not to mention other DACs
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Yeah but I am just saying if you must use MFI Dac then whats the point?
  
  dev_meme 2y
  
  The point is that if standard is not providing clear solutions, then we have problems
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  How does a standard not provide good instructions if the windows driver was not made for anything better than 92kHz? And due to this it would use the first entry of supported mode. What does this have to do with standards? Its clearly a driver issue. Hence it got fixed in like 2 weeks when I reported it
  
  dev_meme 2y
  
  Scroll up - shit’s working randomly even on androids, why should I care and choose stuff or test stuff if it should just work? Why do you speaking about windows where it can be fixed relatively easy compared to any mobile device?
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Okay again. You must go through MFI certification in order to make an apple headset (unless you are in china ig). You have how many devices to test this on? Have you seen how many devices android runs on or windows runs on? Did you see the USB device descriptor for USB audio? That shit exists before type c was a thing. Now again. The OS you are using is not an idiot. There are limits. For many reasons. Hardware limitation. Do you know what that is? Do you prefer some kind of funny device that pretends to be something with impossible specs and cause some bugs or do you prefer a driver that is smart enough to prevent devices from faking shit? Did you hear of the PS3 or 4 I forgot which one’s USB exploit? Do you also make your software adaptive without a single thought of “well I can’t imagine any device having so many whatevers” and do you not place a limit on it? If something is super large its a pretty good sign somebody is trying to do something funny. Are you really this inexperienced?
  
  dev_meme 2y
  
  Blah blah blah, too hard for us to do so we won’t bother at all and let the manufacturers decide their own shit! 10/10 man, 10/10 I’m ready for your explanation why USB, card readers, Ethernet, PD and HDMI works every time but not the 3.5mm, oh man I’m so ready!
  
  @qtsmolcat 2y
  
  Because apple is a giant pita and doesn't like to follow standards
  
  dev_meme 2y
  
  Tell me you can’t read without telling me
  
  @qtsmolcat 2y
  
  Tell me you're just another troll without telling me you're a troll
  
  dev_meme 2y
  
  Read the whole thing - converter doesn’t work on every android phone, so I guess you is a troll now
  
  @ZhongXenon 2y
  
  “But I connected 3 wires, it no work”
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Jokes asside one is purpose built for 1 task, the other is built to support a lot of crap with different modes. And he is mad at the standard that the software vendors made a realistic limitation back then to not make their OS absolutely exploitable
  
  dev_meme 2y
  
  this u: 🤡
  
  @ZhongXenon 2y
  
  Lmao
  
  dev_meme 2y
  
  You made good contributions to discussion, there’s no need for personal attacks like this. I mean, you def better than those who typically do it 😉
  
  @ZhongXenon 2y
  
  Tbf I am not offended. Idc at all, I would wish people would be less “I know it better”
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  But I know it better/s
  
  @ZhongXenon 2y
  
  Lmao
  
  dev_meme 2y
  
  I just read through good discussion I heard similar feedback about pros of lighting against many usbc standards. Btw Apple solely holds TONS of patents, including many of those which lies in foundation of common things used daily. They always had top notch hardware research team What I want to say is that such point of view is surely may exist and many of provided arguments were good. As long as discussion is maintained in good faith it will make all participants and readers smarter. What else might be better for a meme channel chat? 👀
  
  @ZhongXenon 2y
  
  You might want to check this out tho🤣
  
  dev_meme 2y
  
  I understand that there is some work needs to be done to make it work without all that bullshit, but it is not THAT substantial compared to packing everything else in one protocol, and I'm amazed how badly this functionality is broken
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  💀💀💀💀💀💀 yeah those purpose built connectors are way more complicated another connector that has “universal” in it’s name🤣 useless to explain it to you
  
  dev_meme 2y
  
  yeeaahhh, add a goddamn header for DAC audio and leave conversion to manufacturer - it is a loooot harder than making everything else work on the same connector, even USB headphones work
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  I love it 😂😂😂! Have you ever seen just the windows dialog/properties box for an audio device? Please I am begging you check it out. Did you see the effects page? That only shows up for some devices? Hmmm 🤔 I wonder why that could be🙀? Or the page to change the sample rate and sample resolution? I wonder what those settings do in the background! How interesting! Or what are those toggles for “allow apps to take exclusive control over this devices” could do… Hmmmm… And very interesting! Did you know back in the 90’s/00’s you had audio comming out of your video card? 🙀🙀 holly moly why could that be ever a thing?💀💀💀
  
  @ZhongXenon 2y
  
  Smells like legacy
  
  dev_meme 2y
  
  yeah, I reversed a few USB protocols, so what? USB lacks version negotiation? add this header or flag or whatever to latest USB v3.1415926535897932384 and just not use it if the version is lower
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  X
  
  dev_meme 2y
  
  Z
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  You know the meme, “Press X to doubt”?
  
  dev_meme 2y
  
  Did not parse it sorry, now it's good lmao
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  The clue should have been the graphics card part but whatever.
  
  dev_meme 2y
  
  I'm by no means USB spec expert and not a really typec hater (it's surely convenient to charge everything with everything), but the whole situation with typec-3.5mm looks too stupid for any explanation provided - that's not some very rare thing to include in "standard instead of all standards", and I fully understand that something like GPU adapter for laptop can lack full P&P support without drivers
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  That’s because audio tech in general stopped innovating. I used since like a decade 192kHz cards. And the only time I ever saw anything higher was this 3.5mm dongle. Everything built into laptops is like crap at best. 48kHz💀💀😂😂 so the driver just never got an update and its not like the driver needed any real fix. It just needed 1 value to accept more modes in its buffer (probably, I don’t have source code). Because the issue was this dongle even supports radio quality 💀💀💀💀
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Also this bug is purely just the USB2.0 Audio drivers fault. Like these drivers work in a chain and the actual audio device driver did support higher resolutions but only through the USB driver it will truncate the list I think on builds before 17XXX
  
  dev_meme 2y
  
  Yeah, it's legacy for sure but it's a lot of wired hp and general sound systems still in use - I prefer wired headphones for every application except sport and maybe car audio, and I'm not audiophile - give me my 192kHz and I will be happy forever but instead I got 1G Ethernet link to my iPhone, very "useful", probably 10G will work too, just the right adapter required not to mention implementing old standard that won't get any updates in a billion years seems even easier
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  @everyone this is what too many layers of abstraction causes…
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Lightning is flawed. Sure its way better than MicroUSB but it doesn’t come very close to USB-C
  
  dev_meme 2y
  
  Name the flaws, I’m curious
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  The fact that the contacts are on the outside causes lot of oxidizing and even if you are one of the people who can be careful with the cable not breaking the connector will break after that one pin degrades to dust
  
  dev_meme 2y
  
  I saw only one oxidized lightning cable - it was drowned in the salt water while still being powered on for quite some time, that’s it - probably 50-60 cables that are still alive after 3-4 years of use and abuse, and couple broken ones - all user error. Same oxidation flaw applies to every cable, but on lightning it’s visible at least
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Idk my sweat is salty then👀. But thats not an excuse why I can’t put my cable in my pocket
@Ben_404 2y

I'd bet that of the startups that move to the US many are either dating apps or other "service as a product" style businesses who rely on data acquisition.
@AmindaEU 2y

Mood although I have no idea what is SMB in this context https://github.com/liberapay/liberapay.org/issues/30
@DavidGarciaCat 2y

This new law only benefits non-Apple customers: any Apple customer now needs to buy a new cable because I won't be able to use the one I have from my device
1. @nightingazer 2y
  
  ah, yeah, those famous apple cables, that live not months, but even a couple of generations of iPhone
@DavidGarciaCat 2y

And probably a new charger because it might not be the same
@DavidGarciaCat 2y

The EU might be good for some things but if they want to rule private companies then they should guarantee utilities don't get overpriced, or broadband providers don't suck customers blood
@DavidGarciaCat 2y

Mate, this is as simple as “use the right tool for the job”. If USB-C was not even considered for years, then there must be a reason that neither regulators nor customers understand because none of them know the tech requirements their devices have. Only because someone says “I have an Android and when I go to visit my friend I find myself unable to use their charger” - Wake-up! That's the same than petrol and diesel! Or when someone has a food allergy and they can't eat something (like additives) but it's everywhere because someone decided it must be. I experienced this crap first hand!
dev_meme 2y

It’s not applicable for USB connection for example, HDMI and Ethernet works fine
@DavidGarciaCat 2y

Want a standard? Manufacturers must provide the necessary cables. Don't force them to use “your” design. That's not an open market if someone imposes rules!
1. @callofvoid0 2y
  
  i like to send videos with my custom made format good luck opening it
2. @callofvoid0 2y
  
  standards are made for communicating between products of different manufacturers
dev_meme 2y

Or even worse - author of usb and typec standard
1. @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  You mean apple? And intel? And Microsoft? And the other software companies behind it?
  
  dev_meme 2y
  
  Yes, they sucked quite good on this standard
@DavidGarciaCat 2y

Then use an adapter - Apple provided it but not Android. So fuck Apple? That's not a standard, it's a way to force Apple to operate against their own product
@DavidGarciaCat 2y

Options are there - imposition is the problem.
dev_meme 2y

That’s why I’m sure that lightning was superior
@RiedleroD 2y

that's bs. I can
1. @RiedleroD 2y
  
  MOST humans can only hear to around 17-18kHz, young people often hear up to 20kHz, and freak accidents like me can hear up 21kHz-22kHz
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  Lol 22?
  
  @RiedleroD 2y
  
  barely. I haven't taken a hearing test in ages, but that's my guess, based on when my peers stop hearing the frequencies.
  
  @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  I found one on YouTube and it was like 16k and then I couldn’t hear anything. I was like “this doesn’t seem right” funny thing was that the audio was lost in compression above 16k💀💀💀😂😂
@RiedleroD 2y

you need double the sample rate to accurately convey a signal. 44.1kHz is a bit too close to the hearing range limit, so I prefer 48kHz. 192kHz is overkill though, yeah.
1. @ZgGPuo8dZef58K6hxxGVj3Z2 2y
  
  I can’t agree with you here twice the hearing range is still not the limit.
@ZgGPuo8dZef58K6hxxGVj3Z2 2y

Ok I can barely can hear that, but you need to consider harmonics and if you are near the sample rate the waves start sounding like sawtoots
@ZgGPuo8dZef58K6hxxGVj3Z2 2y

Harmonics and waveforms are still there
@waifu_anton 2y

Damn, so much arguing about a simple cable and a simple standard

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EU regulations backfire and push fledgling tech startups across the Atlantic

Why is this Startup meme funny?

Level 1: Strict Teacher, Empty Class

Level 2: Startup Exodus

Level 3: The Regulatory Boomerang

Description

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Common Tags

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