Setting up a business also involves compliance with every law related to your business, hiring employees, purchasing services for the business, etc etc. All of these things are more onerous, expensive and difficult here.

I've been involved with many startups on both sides of the ocean. In America (for better or worse) you get up and go. In Europe, simple things like creating a contract and paying someone are way more difficult and the barriers are much higher. Everything from the address you register your business at to protecting yourself legally is an issue.