Anywhere you travel in Europe, you’re likely to visit a tech hub. In any capital you can easily find tech communities, hosting events every day of the week, or discover companies working on cutting-edge tech, from life-changing apps to unique emerging technologies. Every European city is becoming a tech city according to the latest edition of The State of European Tech report.
From Stockholm to Barcelona, many cities want to position themselves as the Silicon Valley of Europe. However, data shows the startup ecosystem is decentralized in Europe. There are already over 160 hubs in Europe, and this number has been steadily growing during the past few year. In each of those cities, over 50 tech-related events happen yearly.
Amongst other metrics, the report looks at investment, number of startups, tech-related happenings, and employees. The results indicate the European tech ecosystem can produce world-class innovation and $100bn companies. The future looks encouraging.
European tech investment
At $13.1bn, the total capital invested into European tech in 2017 has exceeded the record-breaking levels of 2016, with a focus on fintech, food, transportation and healthcare. All these industries have seen large capital investments in 2017.
Such investment is reflected in the employment data. Europe’s tech workforce is growing significantly faster than overall EU employment: 3x year-on-year growth in 2017, compared to just 0.8% growth in overall EU employment in 2017, according to the European Commission’s latest economic forecast for winter 2017.
Mobility is a defining characteristic of this workforce. The high founder mobility, particularly seen in Central and Eastern Europe, is a proof of the decentralized tech ecosystems in Europe. 21% of European founders moved to another country to start-up. The rise of the remoter is confirmed.
Europe bets on deep tech
Deep tech refers to advances and groundbreaking technology that has a profound impact on people’s lives. Rather than using technology that is commonly available, deep tech startups are businesses built around technological innovation. In this regard, European deep tech continues to attract large investment. Europe is on track for $3.5B to be invested into deep tech companies in 2017.
Artificial technology and cryptocurrencies are seen as major opportunities for European tech leadership on the global stage. European developers are hugely active in driving blockchain development. For example, there are 8,265 active blockchain projects in Europe, according to a recent Deloitte analysis of GitHub data. This compares well to the 9,565 blockchain projects in the US.
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Barriers to Europe tech innovation
While the state of European tech is rather positive, the report also identifies some challenges. Regulation is still considered the biggest barrier to scaling European tech. There is a lack of common rules around emerging technologies such as blockchain and cryptocurrencies.
Finally, gender imbalance in European tech is alarming. Only 9% of CxO positions of venture-backed European startups are held by women.