From Atomico:
Executive Summary
For the past four years, we’ve produced an exhaustive deep dive into the European tech ecosystem by analysing the rich insights of our data partners. Every year the data busts another myth about our ecosystem: from pointing out that Europe actually has more developers than the US, to quantifying European advances in deep tech....MUCH MORE
This year we’re at risk of sounding like a broken record about breaking records - but we can’t dispute the data. In another extraordinary year, investment in European tech reached a record $23 billion - up from $5 billion just five years ago. European founders created 17 billion-dollar companies. And in 2018, Europe produced three of the ten biggest venture backed public listings.
At a macro-level, Europe’s technology sector is booming as the wider economy is stuck in the doldrums. As of Q3 2018, European growth was flatlining at 0.2%, the lowest rate for four years. Europe’s software industry is now growing at least five times faster than the rest of the European economy. This year’s report suggests that for a number of reasons, this motor will only become more powerful. The importance of the tech to the overall economy will only increase.
Last year we found that Europe was experiencing a ‘Battle Royale’ for talent. This year was the year Europe figured out how to effectively mobilise its deep pools of talent. The tech sector is attracting more participants - whether measured by the healthy increase in professional developers or the uptick in talented executives moving into tech from other sectors. The report shows dense areas of talent coalescing around universities, anchor tech companies, and innovation hubs, leading in turn to increases in investment, and growth in anchor tech companies. This all contributes to 'density' - which historically has been a crucial precondition for explosive growth. Europe is certainly achieving density, but it’s doing it its own way. What is interesting is that the developer pool is growing fastest outside those countries that have historically attracted the most investment: Turkey, Spain and Russia’s pool of developers have been deepening the most rapidly. All this will lead to a massive potential upside for the wider European economy as capital eventually flows into these new communities.
This year’s report also shows that we are only scratching the surface of the potential of Europe’s research community, and not fully harnessing our own cutting-edge science. An analysis by CERN, one of this community’s most influential members, demonstrates that as science and tech converge further, there is huge scope to strengthen the link between European STEM and startups. Europe has a research community larger than U.S. and China - we need to make sure this becomes the hugely powerful differentiator it should be....
