Startup Genome and the Global Entrepreneurship Network announced on Thursday the launch of the 2023 Global Startup Ecosystem Report (GSER) at The Next Web Conference in Amsterdam.
The Global Startup Ecosystem Report 2023 (GSER 2023) is a comprehensive analysis of startup ecosystems worldwide.
Informed by data on 3.5 million startups across 290+ global ecosystems, the report provides compelling new insights and deep knowledge about startup trends globally, claims Startup Genome.
Global Startup Ecosystem Ranking
According to the report, the top three ecosystems — Silicon Valley at the top, followed by New York City and London tied at #2 have maintained their positions from 2020.
The top 20 global startup ecosystem rankings are:
#1 Silicon Valley
#2 (tied) New York City
#2 (tied) London
#4 Los Angeles
#5 Tel Aviv
#6 Boston
#7 Beijing
#8 Singapore
#9 Shanghai
#10 Seattle
#11 Washington, D.C.
#12 Seoul
#13 Berlin
#14 Amsterdam-Delta
#15 Tokyo
#16 San Diego
#17 Toronto-Waterloo
#18 Paris
#19 Chicago
#20 (tied) Sydney
Here’re some of the key findings in the global startup ecosystem
Boston, Beijing, and Singapore
Boston and Beijing have both slipped out of the top five, with Boston now at the sixth position and Beijing at the seventh position, losing two spots each.
Singapore has made an impressive jump, entering the top 10 for the first time and moving up ten places from #18 in the GSER 2022 to #8.
China and India
Major Chinese ecosystems, including Shenzhen, Beijing, and Shanghai, have dropped in the overall rankings.
Shenzhen moved down 12 places, Beijing moved down two places, and Shanghai moved down one place. They are now ranked at #35, #7, and #9, respectively.
Indian ecosystems, on the other hand, continue to rise in the rankings. Mumbai has moved up five places to tied #31, Bengaluru-Karnataka moved up two places to #20, and Delhi also moved up two places to #24.
In the top 20 global startup ecosystems, London, Berlin, Amsterdam-Delta, and Paris have secured their positions.
Key takeaways for Europe
Early-stage funding is down 15%
According to the report, early-stage funding in Europe was down 15 per cent in 2022.
However, the average early-stage deal amount was up 7 per cent due to a significant reduction in the number of deals, just 75 per cent of 2021’s number.
Series B+ deals fell 11%
For the same period, the number of Series B+ deals fell by 11 per cent and Series B+ funding amount fell by 29 per cent, from $67M in 2021 to $48M in 2022, says the report.
In the period 2018–2022, Europe experienced an 18 per cent increase in Series B+ deal count and 160 per cent increase in Series B+ amount.
As per the report, Europe also experienced a 56 per cent increase in early-stage deal amounts over the same period, highlighting the long-term growth in startup investment in the region.
Fintech – a major European sub-sector
Fintech has become a major European sub-sector as digital adoption after the financial crisis disrupted the financial services industry.
London’s Checkout.com and Revolut are two of the most valuable VC-backed companies in Europe.
“However, in 2022 the sub-sector trended downward, likely influenced by the prospect of regulations over data, security, and the financial services industry in combination with the general downturn,” says the report.
London, Berlin, and Paris
London stays #1 in Europe and has the most companies valued at over $1B in the region. The ecosystem’s 83 exits over $50M include Wise at $12.2B and Deliveroo at $10.5B.
Revolut, one of Europe’s largest Fintech unicorns, is valued at $33B.
Berlin moved up to #13 globally and #2 in Europe. The German capital minted five new unicorns in 2022, increasing the total count from 14 to 19.
Paris has dropped three places to #18 globally, yet remains a leading European ecosystem at #4 in the region. The French capital increased its number of unicorns from 14 to 30.
Zurich and Estonia
Zurich climbed up 10 places to #36, making it to the top 30 + runners-up for the first time. The growth was spurred by the number of exits over $50M increasing by 300 per cent from GSER 2022.
Estonia has moved up 28 positions since GSER 2022, reaching #10 in the Emerging Ecosystems ranking. It experienced an increase in early-stage funding rounds and a 100% increase in exits over $50M.
In the longer term, Estonia has experienced a massive 439 per cent increase in early-stage deal amount from 2018 to 2022 and a 50 per cent increase in early-stage deal count in the same period.
Top five ecosystem in Europe
#1 London
#2 Berlin
#3 Amsterdam-Delta
#4 Paris
#5 Stockholm
Amsterdam – Home to 4,000 startups
The Amsterdam region is home to approximately 4,000 startups that employ 196,000 people, and the last few years have seen an overflow of funding pouring into the ecosystem.
Myrthe van der Erve, CEO of The Next Web, says, “The Amsterdam ecosystem is thriving and has created an environment for talent and entrepreneurs to excel. I can see a new powerful growth spurt ahead if we continue to work together connecting all ecosystem players in the city and across the Netherlands.”
For example, H1 2022 saw VCs invest €2.8B into startups based in the city.
This figure came back down in H2 2022. However, with €698M invested, H1 2022 was still the second-highest amount of funding the region has ever received in a half-year period.
“In short, Amsterdam-based startups are a magnet for VC funding,” says StartupGenome. Here’re some of the key findings on Amsterdam-Delta on GSER 2023.
Popular VC-backed startups location
Amsterdam has become the most popular location for VC-backed startups in the Netherlands with 45 per cent of all Dutch-funded ventures having their HQ in the city.
Amsterdam’s homegrown startups employed 49,000 people in 2022, a 6 per cent increase year-on-year, and more than 260 foreign startups employed another 23,500 people.
International giants such as Tesla, Meta, IBM, and Google have offices in Amsterdam and the city’s ecosystem was valued the highest in the EU in H1 2022.
Around 90 per cent of VC funding flowing into Amsterdam comes from foreign investors. From 2018 to 2022, Amsterdam’s startup ecosystem raised $17B in VC funding.
Created ecosystem value of $82B
The GSER revealed that Amsterdam ranked #14 on the global scale and created a total ecosystem value of $82B between July 1, 2020, and December 31, 2022. This represents an increase of 36.6 percent compared with July 1, 2018, and December 31, 2020.
Ecosystem value is a measure of economic impact, calculated as the value of Exits and startup valuations, says the report.
Amsterdam is among the top 15 global ecosystems
Amsterdam also secured a position among the top 15 global ecosystems in terms of funding, indicating strong innovation and early-stage funding activities.
Furthermore, Amsterdam was featured among the top 20 global ecosystems in terms of talent and experience, demonstrating its ability to attract and retain skilled individuals over the long term.
Second largest European ecosystem in performance
According to the report, Amsterdam stands out as the second-largest European ecosystem and ranks among the top 20 global ecosystems in terms of performance.
This assessment is based on the accumulated value generated by tech startups through exits and funding. This indicates the ecosystem’s size and performance in the entrepreneurial domain.
Fintech – the driving force behind Amsterdam’s startup ecosystem
GSER shares that more than 20 per cent of startup jobs in the Amsterdam ecosystem are in Fintech, with 1,200 added in 2022.
Canadian cross-border payments network Buckzy and US banking startup Trovata are set to open offices in the area.
While the fintech sector is still the top performer, attracting €189M in funding from January to June 2022, other industries are catching up too, disclosed the report.
During the same period, startups in the health sector raised €161M, transportation €129M, and education €28M.
Other industries are also showing strong growth, with security and food being thriving areas of research, innovation, and investment.
#2 in the Global Green Finance Index
Amsterdam placed #2 in the 10th Global Green Finance Index.
The Netherlands’ capital city also took second place in the 2022–23 fDi Intelligence Global Cities of the Future rankings.
Top five ecosystems by VC funding per capita in Europe
#1 London
#2 Stockholm
#3 Zurich
#4 Munich
#5 Dublin
“We’re honored to work alongside TechLeap and continue to exchange policy and program best-practices on ecosystem development topics for Amsterdam,” shares Marc Penzel, Founder & President of Startup Genome.
“The startup ecosystem continues to punch above its weight, displaying strong performance as well as funding and cementing its position as a leading European ecosystem. Our partners continue to develop programs that foster a strong entrepreneurial culture and mindset right from the bottom up in this tight-knit, high-talent ecosystem,” adds Penzel.
Read the orginal article: https://siliconcanals.com/news/startups/london-berlin-amsterdam-are-top-3-startup-ecosystems-europe/
