Can European start-ups crack the code ?
- Roland Berger
- 29 oct. 2015
- 2 min de lecture
The European digital start-up landscape is now far more mature than ever before
USD 110 billion is the cumulative value of all large European start-ups
86% increase in finance achieved over the first six months of 2015 compared to the same period in 2014
Non-EU private equity managers invested EUR 6 billion in European businesses between 2010 and 2014
No better time for start-ups to break free from the US role model and establish themselves
Roland Berger vision draws on Europe's inherent strengths: industrial expertise, diversity and internationalization
Deconstructing the myths about European digital start-ups
As a starting point for our insights, we revisited certain myths about the European start-up landscape in order to map the current status. 1. Is the European market not attractive to start-up entrepreneurs? London, Paris and Berlin are all prime examples of ecosystems that for different reasons have proved very attractive. Most surprising perhaps is Berlin. Despite lacking both big industry and corporate DAX headquarters, the German capital has witnessed a creativity revolution. Paris, too, is home to over 12,000 start-ups with the French capital benefitting from an excellent talent base, especially in engineering. 400% more accelerators and incubators populate the European start-up ecosystem today than did so in 2007, thus making it much easier to launch a start-up business. 2. Do European start-ups lack capital? They are still not on a par with the US but are rapidly catching up. European digital groups completed 46 "large" fund-raising rounds (achieving USD 30 million or more) worth a combined total of USD 5.7 billion compared to a total of USD 2.9 billion in 2014. Offshore funding is also no longer uncharted territory for the Europeans. Between 2010 and 2014, non-EU private equity managers invested a total of EUR 6 billion in European businesses. Large European start-ups are currently worth a total of USD 110 billion and seven companies including Rocket Internet and Zalando in Germany completed successful IPOs in 2014. In 2015, the number of European IPOs increased by an impressive 30%. 3. Is attracting talent a problem? While the language barrier for highly qualified individuals remains a challenge, as do prohibitive work rules for example in Germany, there is good news in abundance. Europe is singularly well equipped with some of the finest business schools around. 4. Is the European business environment start-up friendly? Although Europe does not yet have a single European digital market, broadband penetration in the hubs is good and there is a high standard of data security. Europe continues to represent good value for money, with senior software engineers costing less than a quarter of their equivalent in Silicon Valley. Even the more costly European hubs such as Paris are up to 30% cheaper than San Francisco, for example, when it comes to renting prime office space. It is in the offline world, however, where European strengths really lie and the digital transformation is continuing unabated.
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