It's a single market on paper as the eu only mandates a small subset of common rules and regulations such as removing tarrifs or freedom of movement, but have you ever tried in practice to launch your company from Belgium to France or from Netherlands to Belgium or from Austria to Germany, or from Romania to Italy?
It's much more difficult when the rubber hits the road as every country has various extra laws and protectionist measures in place to protect it's domestic players from outsiders even if they came from within the EU. And that's besides the language barrier which means added costs. This is much less efficient than the US market.
EU countries and voters still value their national sovereignty and culture (both with the upsides and downsides) above a united EU under the same laws and language for everyone, ruled from outside their country's borders. See what happened with Brexit and the constant internal squabbling and sabotaging over critical EU issues that affect us all like the war in Ukraine or illegal mass migration. An US style unification just won't work here since every little country wants to be it's own king while having its cake and eating it too.
California has more burdensome regulations and higher taxes than other states and yet it's home to silicon valley.
We're talking about scaling internal companies across EU, not about imports and exports. And scaling local start-up across the EU is a regulatory and legal nightmare for small companies.
Shipping and selling imports and exports of commodities are a solved problem for decades, but scaling a on-line notary service for instance, that works both in Germany and in Italy, isn't. The EU doesn't help much with that as they only say you should have no tariffs between each other, not that you shouldn't have various legal, cultural and bureaucratic protectionism idiosyncrasies in place. The EU won't and can't force countries to improve that to make doing business easier for cross-country start-ups.
EU countries have a lot more roadblocks between each others than US states do when ti comes to scaling businesses.
Obviously there is a lot to criticize about the EU and I can offer you a gigantic list there too. However, I do not see any clear failure of the EU’s approach as a single market so far. Additionally part of the philosophy was establishing peace in a region that was torn up by wars for a lot longer than Christianity exists. I would argue the EU was quite successful there too.
