Europe’s top 10 most entrepreneurial regions
Spanning from the Mediterranean to the Arctic, the European Union tries to create equal conditions for all its member states and inhabitants. Venture capitalists have their own agenda as they ignore European Union boundaries and clearly target their own favorite hotspots. In fact, the geographical scope of VC investment in the EU remains heavily skewed to the northern parts – the invisible barrier stretching from Germany, France and the UK into Scandinavia.
Europe’s top 10 active regions based on the amount and size of actual closed vc deals(data from Tornado Insider):
1. London (9.4% of all deals in Europe since 2000)
2. Paris (5.4%)
3. Stockholm
4. Dublin (Ireland has dropped behind in 2006 with only 9 deals recorded so far)
5. Cambridge
6. Amsterdam
7. Munich
8. Copenhagen
9. Berlin
10. Helsinki.
VC investment typically plays to regional technology strengths. Whereas the usual city names pop up (London, Paris, Dublin, Munich, Amsterdam, Stockholm) as favored areas for Software investment, Biotechnology & Healthcare hotspots are located in Cambridge, Paris, Copenhagen, Martinsried, Berlin and Heidelberg. Cambridge also leads the Computers & Electronics category, with Bristol second, followed by Berlin and Glasgow. Most VC activity in the Communications sectors is in London, Stockholm, Paris, Cambidge, Helsinki and Espoo. The cities listed can boast renowned research centers, interest of industry giants, a history of entrepreneurship and long VC traditions. Having said that, the southern and especially eastern European regions house great technology talent and huge potential. Indeed a host of regional and international funds have increased their presence in Eastern European countries recently, so we expect to see more local entrepreneurship and startup funding in the coming years.
Emerging ecosystems for entrepreneurship in Europe (part II)
From my last post it should be clear not to solely focus on Europe’s capital cities for finding entrepreneurial ecosystems. They will rather be found somewhere around smaller regional cities in the proximity of universities and research institutes (eg. Leuven, Cambridge, Heidelberg, Tampere) and were baptized as clusters of innovation (or valleys). Real innovation clusters are mostly sector focused (Food Valley (NL), Medicon Valley (DK)) and linked up with big corporations from that industry.
Other elementary requirements to have healthy ecosystem besides these ‘clusters of innovation’ are seed money, venture support (high tech incubators) and most importantly real entrepreneurs.
Financing has always been an issue. The so called equity gap (raising venture finance between 200k euro – 1M euro) has always been a serious dumper to kick-off innovative start-ups in Europe and it still is (too a large extent). We don’t have such a lively Business Angel scene as in US, nor do we have a large pool of serial entrepreneurs. But also here things are changing. Eventually European entrepreneurs had to wait for government initiatives to help bridging this equity gap. A good example tackling this problem in the German market is the recently launched and very active High-Tech-GruenderFonds and we are now waiting for other EU countries to launch similar initiatives.
Emerging ecosystems for entrepreneurship in Europe (part I)
I got to this post when reading David Hornik blog on ‘Entrepreneurship in Europe’. To a large extent I understand his opinion and agree with most of what he is writing but there are some differences. A first difference is on the ecosystem for entrepreneurship.
There are several regional ecosystems for entrepreneurs emerging all over
Europe. You won’t just find them in Europe’s major cities like Amsterdam and
Paris and that is why they’re sometimes harder to find by non-Europeans. Todays emerging innovative regions can be found in the regions around Leuven (BE), Cambridge (UK), Heidelberg (DE), Nice (FR) or Tampere (FIN).
Europe, a continent of regions
Currently, Europe counts 25 member countries. The last 10 joined in May 2004 and another 2 will join next year in 2007. Among these countries there are a lot of differences, culturally and of course economically. When making a comparison between entrepreneurship in Europe, Asia and the US, one needs to be careful not to make judgments based on what is happening on a continental level. Entrepreneurial activity very much depends on the ecosystem the entrepreneur is living in and that is on a more local level and that is why the smaller region is very much important. If one starts to compare regions then you still need to know what can be compared because there still remain large differences. These difference are very much present in Europe, partly because the heterogeneity in culture (North Europe vis-à-vis South Europe) but also very much because of the different historical backgrounds of the different EU member countries (West Europe vis-à-vis East Europe). But these differences are changing (of which the economic difference quicker than the cultural one). The catch-up of Ireland, labeled ‘Celtic Tiger’, with the rest of West-Europe is a good example.
Regions of innovative clusters and entrepreneurial hotspots
Even within the innovative and emerging regions there are siginificant differences. As an example take the region I come from, the Flanders region (for a nice impression of the region visit www.flandersdc.be) in Belgium. Even within this relatively small region we have several smaller sector focused cluster networks which are part or act as a matrix of the larger innovative region and are located around cities, eg. the DSP Valley around Leuven, an I-City or multimedia cluster around Hasselt, a biotech cluster FlandersBio around Gent. Creating so many clusters is all very nice but one should be careful not to create empty boxes. Real value should be provided to the entrepreneurs.
Interregional growth triangles
On the other hand there is this ‘glocalisation’ meaning that the global ecosystom also very much matters. Even that some smaller regions such as the Cambridge region have little problems in marketing themselves internationally, other regions of similar size, breeding a similiar amount of entrepreneurial entrepreneurs and start-ups are confronted with limited global awareness. That is when some some smaller regions/clusters joined forces, even across national borders, partly to avoid competition among the different cities involved but in particular to better put themselves on the world map as a truly innovative and emerging regions. A good example is ELAT or Eindhoven(Netherlands)-Leuven(Belgium)-Aken(Germany) Triangle incorporating the region of Eindhoven or Brainport Eindhoven (birthplace of bluechip companies Philips and ASML, the region is the most innovative region of the Netherlands), the region Leuven and the region of Aken(DE)/Maastricht(NL)/Hasselt(BE).
For more info on all the European regions that are currently dealing with the implementation of innovation strategies go to Innovating Regions Europe (IRE); this network counts more then 235 regions from Europe + associated countries. To get some insight on what is happening in the US and Asia, one can go to the Stanford Project on Regions of Innovation and Entrepreneurship
Singapore, an entrepreneurial hotspot?
Before making my trip to Singapore last month I had a completely different perception from the island. I expected it to be an entrepreneurial hotspot, the Asian version of Silicon Valley.
Back in 2001 I made my first visit to the island. Then my purpose was to gather information for a case study about the Singapore-Johor-Riau growth triangle, a success story of a cross regional economic cluster and a recipe for growth to network other parts in South-East Asia. Back then I was amazed by the number of business schools, research parks, the amount of international companies, the big LCD screens on the street broadcasting the 9/11 catastrophe, the public transportation, the many local food outlets, and of course the neatness. Singapore is a very clean island. Everything in the city is carefully planned. However, last month I had to assess that nothing much changed since my last visit.
Why arguing it to be an entrepreneurial hotspot?
From the information I got via the internet, Singapore from the perspective of the Singaporean government is doing a great job. Via business portals such as EnterpriseOne, International Enterprise Singapore and Spring they’re successful in promoting themselves, thus marketing is not the issue.
At the same time the Economic Development Board (EDB) is very active in setting up and promoting the many incentives for young start-ups, eg. seed financing scheme SEEDS. For young companies is it easy to attract public funding. The most important element for securing financing from the many public fund is not the groundbreaking conceptual idea, an investor ready business plan or a even a prototype of an innovative product but rather having a third party investor, which can be a relative or business angel.
Compared to other parts in the world, a lot of courses are being lectured on entrepreneurship, venture capital and innovation. Personally, I also participated in a course on the mechanics and intrigues of venture capital. This course explained me a lot, gave me good insight in the VC scene in Singapore and got me to conclude that the island is putting a lot of effort in making the island a true stepping stone for the many young ventures of tomorrow.
Finally, having exchange programmes for aspiring Singaporean young entrepreneurs to experience working for Silicon Valley based start-ups. What more can you do to breed the entrepreneurial spirit? Go to http://www.nusea.org/ to read more.
When having all these arguments, one might argue that this place is a perfect breeding soil for young innovative ventures. Still, investors are complaining about the limited dealflow and in particular the qualitative dealflow. After all Singapore remains a very small market. Check yourself the number of billion dollar companies spun out of Singapore.
to be continued …
the clock is ticking
Today was a busy day. Still a lot of work had to be done before I could get my focus on the trip. I just finished some reports for the Danish partners were teaming with in a EC project and I still need to re-inform those entrepreneurs to whom I am providing venture support about my scheduled trip.
Hello world!
First this blog was a 'between-the-lines' suggestion made in a conversation with my friend Filip. As a surprise he eventually made a registration at wordpress and forwarded me the necessary information to start blogging …. Now it is all in my hands! Let's see what comes out of it.
The purpose of having this blog is not to produce a lot of text but to centralise some thoughts, ideas an findings while traveling in two of Asia's most important living labs, namely Singapore and Shanghai. I am a young guy with an entrepreneurial mindset and sensitive for new trends which I hope to spot on my trip to the east. I will leave for Singapore next Saturday and still a lot of preparation work has to be done.
to be continued …
