

German government puts up $165 million to start Google competitor - jcwentz
http://www.techcrunch.com/2007/07/20/eu-google-competitor-gets-165million-cash-injection/

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pg
This and Quaero will serve as valuable lessons for the governments that
sponsored them. You can compete with Boeing this way, but not with startups.

I admit I'm kind of surprised they still need this lesson. You'd think they'd
have already learned this from the British government's attempt to set up ICL
as a competitor to the Google of its era, IBM, in 1968. Never heard of ICL?
Exactly.

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PindaxDotCom
Um, you can't even compete with Boeing this way.

When will other countries understand that: the best role of government is to
ensure the rights of businesses and people. If you get that right, the rest
will follow. They shouldn't be using tax dollars as venture seed money. They'd
be better off refunding it to the taxpayers!

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Tichy
100% agree - I never saw the rationale for the government making risky
investments, just because purportedly nobody else does. Imagine your bank
adviser telling you they are going to put your money into high risk
investments because nobody else does. Yet if the government spends our money
like that, few people seem to realize that it is basically the same thing
happening.

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dpapathanasiou
_I never saw the rationale for the government making risky investments, just
because purportedly because nobody else does._

Risk is important because it offers incentives to the marketplace, and
prevents economic systems falling into stagnation (local optima), as Aaron
Brown describes in this interview:
[http://marketplacemoney.publicradio.org/display/web/2006/05/...](http://marketplacemoney.publicradio.org/display/web/2006/05/19/poker_face_of_wall_street/)

But I agree with you that it is not the government which should be taking
those risks, since (as others have pointed out in this thread), governments
really don't know what they're doing in that regard.

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staunch
Sad really that so much money will go to waste. There are some amazing hacker
entrepreneurs in Germany -- many of them move to the US. Giving 165 teams $1m
would have resulted in at least one billion dollar company (and probably more
like 20) even with incompetent decision-making.

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pg
The money will not merely go to waste. It will actually harm German startups.
A lot of smart hackers who might otherwise have started or worked for startups
will get drawn into this doomed project instead.

~~~
staunch
That makes a lot of sense. I was just accusing Google of doing the same thing
world wide. Do you think there's any difference between them hiring 5k
developers they can't really make use of and what Germany is doing here?

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ivankirigin
This is perhaps the exact opposite of barebones seed funding.

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pg
Yes, I was thinking that too. This is as far from traditional VC as Y
Combinator is, but in the opposite direction. Which seems a further predictor
of doom, because the trend in venture funding lately has been a shift toward
the low end.

~~~
ivankirigin
Indeed. Also, didn't France already try to make a google killer? That I
haven't heard much lately implies the fate of this program.

~~~
ivankirigin
<http://www.infoworld.com/article/06/12/21/HNquaero_1.html> " The French and
German partners involved in a consortium developing future search
technologies, Quaero, went their separate ways because of differences over
technology, according to senior officials at the French agency funding the
research. "

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gibsonf1
Wow, this could be as successful as Airbus's biggest plane :)

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Tichy
News like that make me hate paying taxes so much :-(

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lkozma
This will give a new meaning to the expression "design by committee".

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adnam
A $165 million kiss of death

