Europe’s startup and scaleup ecosystem has continued its steady expansion, according to the first European Startup and Scaleup Scoreboard (ESSS) released today by the
European Commission. The report points to a clear pattern: countries that have adopted pro-startup policies are seeing measurable gains in innovation, investment, and company growth.
Since 2020, the Scoreboard’s baseline year, 20 of the EU’s 27 Member States have improved their performance, suggesting that targeted policy measures are increasingly translating into stronger entrepreneurial ecosystems across the bloc.
Policy environment shaping startup success
The findings underline a strong correlation between innovation-friendly regulation, access to skilled talent, and the availability of venture capital, and the performance of national startup ecosystems.
A group of “front-runner” countries—Estonia, Sweden, Finland, the Netherlands, and Denmark—significantly outperform the EU average across 36 indicators, by between 40 and 60 percentage points. These countries illustrate how coordinated policy frameworks can accelerate startup growth and scaleup success.
Estonia stands out for its digital infrastructure and early-stage funding environment, hosting 615 venture capital-backed companies per million inhabitants—the highest figure in the EU. Sweden leads in talent availability and later-stage financing, and reports 409 unicorns per million inhabitants, the strongest performance in the Union. Finland shows a particularly strong balance between research and commercialisation, combining high R&D investment with robust patent activity.
Structural gaps in emerging ecosystems
While the overall picture is positive, the Scoreboard also highlights persistent disparities across the EU. Countries including Greece, Latvia, Bulgaria, Slovakia, and Romania lag behind the EU average by around 30 percentage points across the same indicators.
Three main structural challenges are identified: limited access to later-stage venture capital, regulatory fragmentation that slows company scaling, and persistent talent outflows toward more mature ecosystems.
These constraints, the report suggests, continue to limit the growth potential of high-potential startups in several Member States.
Policy response and future direction
The Commission says the findings will inform upcoming initiatives aimed at strengthening Europe’s innovation landscape, including the planned European Innovation Act.
A broader policy package is already in development, featuring proposals such as EU Inc., a unified corporate framework intended to simplify cross-border operations, and the European Business Wallet, designed to reduce administrative barriers for companies operating across multiple EU countries. The EU Visa Strategy is also part of the effort, aiming to improve talent attraction and mobility.
Background: measuring Europe’s startup landscape
The European Startup and Scaleup Scoreboard is a core deliverable of the EU Startup and Scaleup Strategy, “Choose Europe to Start and Scale,” launched a year ago to improve conditions for technology-driven companies.
The strategy outlines 26 measures targeting the full innovation lifecycle, from early-stage support to scaleup expansion. The Scoreboard tracks progress using 36 indicators across six pillars: regulation, financing, market access, talent, infrastructure, and broader economic impact.
The analysis draws on data from Eurostat, the Joint Research Centre, Dealroom, and the European Startup Nations Alliance, covering the period from 2020 to 2025, with datasets finalised in early 2026.
EU Member States are grouped into four performance tiers: front-runners (above 125% of the EU average), high-performing (100–125%), catching-up (70–100%), and rising (below 70%). Photo by Kippelboy, Wikimedia commons.