Today at the ICT 2015 event in Lisbon, Nesta and the European Digital Forum think tank – which I’m on the advisory board of, I should note – are launching the European Digital City Index, an attempt to measure capital (and a few other) EU cities against a number of criteria set by 90+ digital entrepreneurs, policy researchers and academics.

The index finds that London, perhaps unsurprisingly, provides the best support for both startups and scale-ups. For both categories, cities like Stockholm, Amsterdam and Helsinki also understandably receive top marks. That said, the ranking does have a couple of surprises in store – take a look:

 

european digital city index

First of all, it’s important to note that the index is meant to serve as a guide to the strengths and weaknesses of local ecosystems, by benchmarking a number of criteria in each hub.

It’s far from the only index attempting to rank cities and regions based on their performance when it comes to digital entrepreneurship – Nesta in fact provides helpful links to other available resources in its blog post and on the website.

The European Digital City Index covers all capital cities in the European Union, with an additional seven non-capital cities in the EU that are considered to be important hubs of digital entrepreneurship, such as Barcelona, Cambridge and Munich.

List of EU CapitalsThe Index is composed of ten ‘themes’:

1) Access to Capital
2) Entrepreneurial Culture
3) Mentoring & Managerial Assistance
4) Skills
5) Business Environment
6) Digital Infrastructure
7) Knowledge Spillovers
8) Market
9) Lifestyle
10) Non-digital Infrastructure

With that in mind, it’s not hard to see why London, Amsterdam and Nordic cities score so highly. Still, it seems odd that cities like Berlin and Paris don’t even make it to the top 5 for either startups or scale-ups, while cities like Barcelona, Lisbon and Madrid aren’t even in the top 10 for either category (yet Brussels is, for both).

european digital city index

 

London is also the only UK city to make the top 10 list, although we should note that Cambridge and Oxford appear 11th and 13th, respectively, for startups and scale-ups. London, by the way, scored poorly when it comes to labour cost, cost of office space and the cost of living, which is admittedly true for any mature ecosystem.

You can check out the European Digital City Index website to get an answer to questions you may have, but here’s an example of how Berlin’s relatively low ranking (and Brussels’ high ranking) is explained by Nesta and the European Digital Forum:

“Berlin, which has produced a number of billion dollar startups, including online fashion shop Zalando and restaurant delivery service Delivery Hero, is only ranked 7th for these businesses. This is because of its expensive and relatively sluggish digital infrastructure and high cost associated with employing staff. Brussels scores higher for scale-ups because of its greater access to capital.”

In 2016, the Index will be updated and expanded to include more EU cities.

Paris european digital city index

Chris Haley, Head of Startups and New Technology Research at Nesta, comments:

“Entrepreneurship, particularly digital entrepreneurship, is vitally important for innovation and growth but not all cities provide equally fertile ground for these businesses.

Our research indicates that location does matter, and illustrates the ways in which top cities create a supportive environment and where lessons can be learnt.”

If you’d like to learn more about how the index was put together, you can request a download of the raw data and a PDF with the research methodology right here.

Also read:

A look at Europe’s top startup countries: the good, the bad and the ugly

How digital is Europe? New EU Commission index ranks countries based on ‘digital performance’

Your local European tech hub probably won’t be The Next Silicon Valley – and why that’s okay

Featured image credit: George Papapostolou / Shutterstock

  • Wow, looking at the methodology I doubt this is a representative index! Availability to crowdfunding – most of the Bulgarian startups are listed as UK businesses on Kickstarter to be able to fundraise at all, not to mention that lots is going on on IndieGoGo as well. Online collaboration – number of GitHub users, seriously!? Networking and mentoring events – number of Meetup.com events!? Nobody uses Meetup.com as it’s payed service and all networking happens via Facebook events/groups. Just to mention few. This can’t be serious index!

    • Chris, exactly what I’ve noticed when going through the variables for Riga.. It’s a pity that such numbers don’t reflect the actual situation.

      But the initiative is applaudable! :) Hopefully, Nesta and them can use the feedback and work to make the next year Index more trustworthy.

      • Keep the feedback coming, but note that research is always best countered with better research rather than ‘anecdotal’ evidence. You may know your ecosystem well, but comparing / benchmarking 35 in one go means compromise.

        • none of my comments are anecdotal. Not a specialist on research sources but it’s obvious the methodology is not precise and thought over to cover all parties included in the research. Mentioned just the obvious once, but I am working with couple of people from Bulgaria on a blog post to challenge the data for Bulgaria.

  • Raoul

    Surprised Barcelona is not higher. It certainly ranks high in my books for skills, lifestyle and is improving all the time for mentoring and access to capital with success stories like Wallapop, Scytl and Kantox. In good time :)

  • Jo Diercks

    Sorry, but you forgot Hamburg! Hamburg headquarters companies such as Google, Facebook, XING, Parship, Tipp24 or OTTO as well as many succesful “startups” of all sizes (Jimdo, Goodgamestudios, Innogames etc.). That should suffice for a rank ahead of Valletta oder Sofia… Did you even take Hamburg into your study?

    • Perhaps best to ask the people who actually did the study?

    • shhared

      We have asked the same question. Where do you feel Hamburg should sit in this table Jo?

  • Very interesting stats.. as I can see now.. the collaboration of barcelona, madrid and lisbon in the nearest future might rank this region higher in the nearest future! Cheers from Ireland, Swav @PaintingsbySwav

  • Joseph Alexander

    Not a specialist on research sources but it’s obvious the methodology is not precise and thought over to cover all parties included in the research.Lakers Snapback Caps