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Best European Cities for Start-ups    [Date Added : 02/05/2016 ]
Start-ups and entrepreneurship remain important features of today's digital economy, and supporting the development of start-ups has become an important part of the wider business environment.

Around the world, an increasing number of incubators are being set up with the goal of encouraging start-ups. These specific incubators are, however, only one part of the overall picture. The location, often large cities, in which entrepreneurs begin their projects, may also have an effect on the eventual success of those projects. To identify the most friendly cities of the globe for start-ups and scale-ups, Nesta, in association with the European Digital Forum, has developed the The European Digital City Index (EDCi). The aim of the analysis is to provide a "holistic and local view across Europe, describing what ecosystem factors are most conducive to encouraging digital start-ups (and scale-ups)."

The analysis is built from 38 metrics across 10 themes, which cover 28 countries including their capital cities, as well as various cities deemed to have a strong entrepreneurial profile. The theoretical framework was developed from wide-ranging interviews with 75 experts across the region as well as secondary academic literary analysis regarding the various cities. Further data selection and gathering relating to the metrics were collected, before being checked, processed and presented in a visual form.

The top-10 European cities for start-ups are:

1. London
2. Amsterdam
3. Stockholm
4. Helsinki
5. Copenhagen
6. Paris
7. Berlin
8. Dublin
9. Brussels
10. Munich

According to the analysis, London ranks as the number one city for start-ups in Europe. The city scores highly on access to capital, entrepreneurial spirit as well as knowledge spill-over. The high cost of living and the high cost of talent reduce its viability slightly however, putting its business environment (24).

Amsterdam comes in at number two. The city has strong access to capital (3), a robust business environment (4) and entrepreneurial culture (4). It also is considered a great place to live with a permissive and clean environment - although it is very expensive. The city performs less well on digital infrastructure (17) and market (19).

In third spot comes Stockholm, scoring strongly with its 8,000 start-ups with nearly 52,000 employees. In the previous decades, Stockholm's start-ups secured US $2.6 billion in investments.

The study highlights that most southern European capitals fare relatively poorly in the index. Lisbon is found at No. 17, Rome at No. 28, and Athens at No. 34 – Madrid (12) demonstrates a moderately strong performance on the back of its second place finish in business environment.

The top-10 European cities for scales-ups are:

1. London
2. Stockholm
3. Amsterdam
4. Helsinki
5. Copenhagen
6. Paris
7. Brussels
8. Dublin
9. Berlin
10. Munich

Moving a start-up to a world-class business requires a different environment than the start-up phase. The researchers also considered location in terms of their scale-up viability. London again comes in at number one, providing the best access to capital, entrepreneurial culture and knowledge spill-over - while access to skills remains a problem (33).

Stockholm comes in at number two, with strong scores in skills (4), entrepreneurial culture (2) and business environment (6). Amsterdam (3), too, scores well in the scale-up category on the back of access to capital, entrepreneurial culture (4) and non-digital infrastructure (2) - digital infrastructure (17) is lacking, however.
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