SHM2019: Mobility & Interconnectivity

While location remains one of the most important success factors, founders are getting better in circumventing the challenges connected to a bad location. We see a steady increase of founders moving abroad as well as transnational setups of startups with employees, investors and branches in other countries.

Constant Increase of Mobility

Since 2016, we have seen that the rate of foreign-born founders in Europe has increased from 23% to 29% in 2019. Roughly 40% of these foreign-born founders are from outside the EU, showing the immense importance of immigration into the EU for the startup scene.

But also within the EU founders are moving, as depicted in the flow chart below:

The regions benefiting the most from founder migration are the UK & Ireland (+25%) as well as Benelux (+18%) and the Baltics (+16%). Only CEE and Southern Europe lose founders (-9% and -1% respectively). Interestingly, the Mediterranean Spain (+29%) and Portugal (+12%) are striving, while Italy (-20%) and Greece (-39%) are reason for worry.

Moving is not the only option...

Founders do not necessarily have to move to reap the benefits of other locations. In last year’s report we have shown that >60% had legal entities, employees or investors abroad. This year, the rate stands at 57% and confirms this trend.

55% of founders establish international locations within the first year of their startup. This rate is the highest in the Mediterranean region, CEE and the UK and Ireland.

It becomes clear that smaller countries like Belgium, Lithuania or Switzerland have the highest percentage of international startup setups. But also in large countries like Germany and the UK more than half of the startups are transnational. Interestingly enough, Italy and Romania have the least international startups despite a large founder diaspora after a period of emigration. In contrast Greece seems to make good use of their emigrant community in London and other hubs.

Having employees abroad is the most common factor for a transnational setup, which points to the assumption that many startups in Europe are working with remote teams to overcome shortages in the talent pool at home or simply tap into other sets of talents. The same is true for investors, as 27% of startups claim to have international investors onboard. Overall only 8% of startups have established their headquarters abroad. Interestingly this number remains quite low across all countries contradicting the impression of many practitioners that founders in Southern and Eastern Europe are often establishing remote companies in London or Estonia. This could be the fruit of efforts by countries like Hungary, Italy or Slovenia to make starting a company at home increasingly easy.
¬†Founders’ Responses


Some of our employees are based abroad


We have established our HQ abroad


We have established branches abroad


Some of our investors are based abroad


None of the above


It is exciting to see where startups have their international ties. In the interactive chart below you can explore startups from the regions on the left having international ties with the countries on the right.

The top 10 international destinations for European startups when it comes to setting up new locations are headed by the UK, almost on par with Germany and the US. Somehow surprisingly followed by Asia with 10%.

United Kingdom14.63%
United States12.64%