The data isn’t just sobering; it’s a wake-up call for every policymaker from Prague to Brussels. In the Czech Republic alone, 7 out of the top 10 most successful startups have already abandoned their home jurisdiction to incorporate abroad. Currently, only about 10% of global venture capital flows into the EU, while a staggering 70% heads to the USA. We aren’t just losing companies; we are exporting our future tax base and the wealth of our innovation to North American pension funds.
But a ground-up movement is finally hitting the mainstream. Enter “EU Inc” – , the key part of the so-called 28th Regime. This isn’t a top-down bureaucratic mandate or a subsidy program; it’s a pragmatic shortcut. It is an optional, unified legal framework designed to give European entrepreneurs a home-field advantage by mimicking the simplicity, speed, and standard of a Delaware C-Corp.
At Czech Founders, our role is simple: bring the founders, investors and policy makers together and keep the conversation moving. And that’s exactly what this event was about. We had an incredible mix of voices in the room, including Vojtech Horna, Damian Boeselager, Jan Čurn, Katerina Havrlant, Ondřej Krutílek, and Vit Horky – and the discussion was honest, ambitious, and full of momentum.
Takeaway 1: The Magic Number is 85 (and 96)
There is rarely a consensus in the high-ego world of tech founders, but the EU Inc movement has hit a nerve. According to the latest findings from the Czech Founders community, the mandate for change is overwhelming: 96% of startup founders support the initiative, and 85% say they would likely use it as their primary legal form.
This isn’t just a preference; it’s a mandate for survival. The clock is ticking-the survey also reveals that 27% of founders are currently considering a move abroad, a number that continues to climb year-over-year. As Vít Horký, founder of Czech Founders, points out, this is about reclaiming “missed potential.”
"We set up in the UK and then Delaware because investors demanded it. When we sold my previous company, the Czech budget saw nothing. The tax potential of 150 sold Czech companies over the last 15 years has been poured into US and Canadian pension funds instead of benefiting European citizens."
Takeaway 2: Bureaucracy is the “Hidden Customs Duty”
The fragmentation of the European market isn’t just an administrative annoyance; it’s an economic drain. The IMF estimates that regulatory fragmentation acts as a de facto tariff. As Ondřej Krutílek, MEP for ODS/ECR, puts it: this friction hampers internal trade as effectively as if member states were still charging each other actual customs duties.
The pressure to relocate is systemic. Data shows that 59% of founders dealing with foreign investors have been explicitly asked to relocate their headquarters to a “readable” jurisdiction. Investors don’t necessarily want to leave Europe; they just want to avoid the legal labyrinth of 27 different sets of rules. By forcing founders into the UK or the US, the current system chooses the path of least resistance at the cost of European sovereignty.
Takeaway 3: A Company in 48 Hours-The “Delaware-Killer” Specs
The legislative proposal by the European Commission aims to strip away the hurdles that make European incorporation a nightmare. This “Minimum Viable Product” for company law includes features designed specifically to neutralize the Delaware appeal:
- Formation in under 48 hours: The ability to establish a company for less than 100 EUR.
- The “Once Only” Principle: Through EUDI Wallet integration, founders provide data once to a system that automatically communicates with all national registries.
- Digital-by-Default: No mandatory notary visits or physical presence requirements to open bank accounts or sign documents.
- Dual-Class Shares: A massive win for founder autonomy. This allows founders to issue shares with multiple voting rights, protecting them from unfriendly takeovers while they raise capital.
- Harmonized ESOP Framework: A unified Employee Stock Option Plan structure with “no tax before cash” deferral, ensuring talent is rewarded without being hit by a tax bill before they actually see a cent.
Takeaway 4: Standardization is the Real Innovation Flywheel
As Jan Čurn, founder of Apify, argues, the value of EU Inc isn’t just in the legal text-it’s in the standard. Using his “electric socket” analogy, a standard only works if everyone can plug into it.
The goal is to create a “European alternative to Delaware” that investors can trust without a 27-state due diligence process. By creating a unified standard, we trigger a flywheel effect: as more companies adopt the form, a pan-European ecosystem of digital tools, HR systems, and legal templates (like SAFE or KISS instruments) will naturally evolve around it. Standardization isn’t just about rules; it’s about reducing the cost of doing business to nearly zero.
Takeaway 5: The “Weak Spot”-The Missing Court
Despite the momentum, a critical gap remains: the lack of a unified judicial solution. Founders and investors are wary that even with unified bylaws, disputes could still be handled by 27 different, and often slow, national court systems.
"If the speed and quality of courts vary, capital will still gravitate to one or two 'reliable' countries, leaving the rest of Europe on the sidelines."
Current negotiations are exploring a compromise: if a full European tribunal is a bridge too far for the current treaties, the creation of a “national specialized senate” in each member state could provide the fast, predictable, and expert judicial mechanism required to resolve complex venture capital disputes.
Conclusion: The Clock is Ticking
The roadmap for EU Inc is aggressive. With the Commission’s proposal on the table, the goal is to reach a political agreement by the end of 2026, with full implementation by 2027. This is a rare moment where progressives like Damian Boeselager (Volt/Greens) and conservatives like Ondřej Krutílek (ODS/ECR) are aligned: Europe needs a unified playground.
It is vital to remember that EU Inc is a voluntary choice. It is a pragmatic shortcut for those who want to build global giants from European soil without being penalized for their ambition. If we fail to implement this, we continue to be a “tributary” to the US legal system.
If the 28th Regime was available today, would you stay and build the next European giant, or would you still head for Delaware?
Note: The cited survey has not yet been published; the source will be added later. Additional context is available at the Czech Founders website.
A huge thank you to Mews, especially Richard Valtr and Jan Meissner, for hosting. MEWS is such a strong example of what a bold Czech company can become!
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This text was originally published at Czech Founders org website here.
