The first ‘European Startup Monitor’ was published yesterday (3 March). Its aim is to better understand Europe’s contemporary ecosystem and founders as well as what challenges and opportunities are in the future. The study was initiated by the German Startups Association in cooperation with many partners, such as Telefonica Germany, Google or KPMG. For the study, more than 2,300 startups were surveyed, representing more than 31,000 employees across the 28-country block plus Israel and other countries.
The study divided the continent’s startups in three groups – those younger than 10 years, those focused on innovation and those that are growth-oriented and aim for a long-term growth in turnover and/or number of employees. European startups create on-average almost 13 jobs (including founders) after 2.5 years since their foundation and create another almost 7 jobs in the next 12 months. On average, a startup raises €2.5 million in external funding and plans to raise a further €3.3 million to scale. Most founders are between 25-34 years old and only 14.7 percent of startup founders were women. Almost 12 percent of the founders and more than 31 percent of startup’s employees come from countries other than where their companies are based.
When it comes to actual operations, most of the surveyed companies currently serve in other markets than their home market and plan to serve additional 8-10 markets in the future, planning to expand next year. More than 90 percent of the founders are actually satisfied with the current business environment and more than 70 percent expect positive business development in the near future. The most frequently cited challenges of the European startup ecosystem are raising capital, sales/customer acquisition and product development. Red tape and political regulations were also cited. However, most of these findings vary significantly from startup hub to startup hub, which suggest major regional differences in the startup culture across the continent.