Startups and scaleups are key factors in local economies due to their potent growth capabilities. According to the OECD, startups see a growth rate of 20% per year in their first 3 years. Internationalization of businesses is a challenge for all economies and there are certain risks, strategies, and data that need to be studied. It is key for startups to internationalize and in fact many do. More than 50 percent of startups internationalize within the first year, and in the EU more than 86 percent internationalize in the first 3 years.
So when expanding internationally, where do these startups relocate?
According to the Startup Heatmap Europe Report 2021, approximately 37 percent of startups consider the EU as their most important target market, with respondents choosing at least one of the 27 EU countries as their preferred destination. This showcases an important problem of fragmentation of the EU market. Within the EU, the most important target markets are the UK (15%), Germany (13%), and Nordic countries (9%).
Another 30 percent of startups consider the United States as their most important target market, while 10 percent prioritize Asia.Ā