This article is part of Sifted’s Scale Up Europe, an initiative with 150+ innovators brainstorming how Europe can propel its startups to the next level. To frame the debates, Sifted is exploring the region’s most pressing and strategic questions in a series of stories.
It’s no secret that Europe has steadily fallen behind the US and China during the past two decades in the race to generate global technology leaders.
The region is looking to fix part of the problem by spawning startups capable of becoming tomorrow’s champions, as well as generating the next wave of technological breakthroughs (for more on this theme, read the related article about Scale Up Europe’s deeptech discussions).
It has deployed significant effort to attract, sustain and distribute investment into its startups.
But it doesn’t make sense for Europe to lead a tech-only development strategy, nor does a startup-only focus fit. At some point, startups and corporates need to come together if Europe is to leverage its innovation for economic growth.
That’s due in large part to the fact that Europe is still heavily reliant on older industries. Oil companies, carmakers, banks, industrial conglomerates and food and drink still make up the bulk of the region’s economies.
Technology companies account for only about 6% of the CAC 40, France’s leading stock market index. That proportion has nearly doubled in recent years with the arrival of companies like call center management software provider Teleperformance and payments group Worldline, but it’s close to nothing compared to the weight technology companies have in US indices.
In comparison, about 27% of the S&P 500 is tech-related.
In past decades, European champions have gotten kicked off global podiums. Companies like mobile phone pioneer Nokia and national telecoms brands from Orange to Deutsche Telekom have seen newcomers like Google and Facebook eat away at their value propositions and gnaw at their profits.
What is Scale Up Europe?
Scale-Up Europe gathers a select group of 150+ of Europe’s leading tech founders, investors, researchers, corporate CEOs and government officials around the same goal: accelerate the rise of global tech leaders born in Europe, in the service of both progress and technological sovereignty.
Read the full article on Sifted Source
