Startup (or start-up) means an emerging, new or recently listed company.
It must be said, however, that the meaning changes depending on the context in which it is used. Mainly the startup is a temporary organization, in fact it represents the first phase of a company’s life cycle, the start-up phase. It focuses on innovation and is designed to create a repeatable and scalable business model.
In 2023, the global startup ecosystem faced an evolving landscape. Silicon Valley maintains its dominant position, Europe and Italy show distinctive signs in their development. The decrease in investments in Italy has highlighted the resilience of the sector, while the economic and geopolitical context has influenced the strategy of investors, with a general decline but particular attention to new initiatives.
The Economist recently told how at Slush, a prestigious annual technology event that ended on December 1st in Helsinki, the atmosphere among founders and financiers was euphoric, almost comparable to the peak of the dot-com bubble in 1999. With the record attendance of over 13,000 people, including 5,000 entrepreneurs and 3,000 investors, the event transformed into a lively trade fair.
Participants had the opportunity to attend presentations, discussion panels and laser shows, in an atmosphere of celebration and optimism.
Despite this, however, European startups, like those in the rest of the world, are facing challenges due to rising interest rates, which make their future profit prospects less attractive.
According to the “State of European Tech” report by Atomico, a venture capital firm based in London and presented during Slush, it is estimated that European startups will attract only $45 billion in investments this year. This represents a decline of 38% compared to the previous year and 55% compared to the fervent 2021.
The median valuation of the most mature European startups, in the “growth phase”, is now lower than the average of the last five years. While Europe saw the birth of 107 “unicorns” (unlisted companies valued at at least $1 billion) in 2021 and another 48 last year, only seven were added in 2023.
Additionally, many startups previously valued as unicorns have seen their value decline, with 50 cases in 2023 and 58 in 2022, as highlighted by Atomico.
The panorama of European startups demonstrates resilience and growth trends, with a long-term perspective, signs of surprising resilience emerge, with performances in some cases superior to those of the more consolidated US ecosystem.
Although investment in European startups has contracted over the past two years, it still shows 18% growth compared to 2020, despite a 2% decline in the UK.
Europe, including Great Britain, has surpassed the United States in the creation of new startups: around 14,000 compared to the 13,000 Americans recorded from January to September. In total, the continent has over 41,000 emerging and around 3,900 more mature tech startups, employing around 2.3 million people.