Not a month goes by without a fresh article being published, raving about Portugal as the best holiday destination, the safest city in Europe, and the latest real estate eldorado with the best return rates. Just as spectacular is the exponential growth of the city’s tech ecosystem, and its ramping densification. Talent and venture capital money are pouring into the country — both national and international.
Money is pouring in from VCs and tech conference organizers
Last year alone, Portugal’s rapidly growing tech industry raised $350 million in venture capital. Private equity investments in Portugal have more than tripled to €7 billion in the past three years, according to recent industry data, as investors flock to a rebounding economy hungry for capital.
Technology conferences are setting up shop in Lisbon. Most prominently, after a three-year trial, Web Summit has chosen to extend its stay for another 10 years, attracting 80,000 tech professionals to the city’s Altice Arena and expected to generate $3.5 billion in revenue for the country in the next decade. The Lisbon Investment Summit, held every June, is an opportunity for homegrown startups to pitch international venture firms and has significantly contributed to putting Lisbon on the European tech map. Dig publishing, Go Youth, Singularity University have all chosen Lisbon as an HQ or chapter in recent years.
Lisbon’s talent pool is global and abundant
The education system in Portugal is fueling the country’s tech scene with young highly qualified talent. Portugal’s universities have a particularly strong focus on high tech skills. The country’s major university cities each include a technical university and for a country of just over 10 million inhabitants, it’s producing a remarkably high number of engineers per capita; qualified entry-level professionals graduate in the thousands each year from the Politecnico Institute in Braganca, UpTec in Porto, Tecnico and Instituto Politecnico in Lisbon and now the Nova School of Business and Economics’ new Carcavelos campus in the outskirts of the capital. Unsurprisingly, with Lisbon’s economic boom, more qualified Portuguese youths are choosing to stay in Portugal as fresh graduates, rather than hunting for their first job abroad in cities like London or Paris.
On top of that, Portugal and Lisbon in particular, have seen an increasing number of qualified international professional relocate to Portugal – from entry level youths to more visible C-level executives such as Felix Petersen at Faber Ventures, Simon Schaefer at Startup Portugal and Rohan Silva who moved from London a few years ago to launch Second Home’s Lisbon offices.
Setting up in Lisbon is easy and more people are choosing Lisbon
The city’s ability to absorb and accelerate new businesses continues to expand, making it faster and easier to open a startup in Lisbon compared with many other European tech hubs. Beta-i, one of Lisbon’s historical co-working spaces and accelerators has tripled in size to around seventy employees in the last 12 to 18 months and is driving much of this boost. Dozens of new workspaces have opened in the last year, such as Heden, IDEIA, and Cowork Lisboa, to name a few. Exclusive members club Soho House recently announced that it will open a house in Lisbon by 2020. Last but not least, the city announced the launch of Beato Creative Hub, a 35,000 m² mega campus scheduled to open before the end of 2018, comparable to Paris’ Station F, and creating an estimated 3000 jobs.
It’s never been easier to find a place to accelerate a business or start a freelance activity in the thick of Lisbon’s bustling tech scene. Dozens of international startups are opting for Lisbon as their headquarters. Companies like Linkilaw, JungleAi, and Yoochai, all run by international founders, either decided to launch here or move to Lisbon early on. New York-based James AI opened an office here, and so did Veniam after a $26.9M fundraise earlier this year.
Even corporate giants are choosing the city as a viable base for additional growth. Daimler will soon be opening up a major tech hub, and Google announced the launch of an engineering hub in Oeiras steps away from Lisbon’s breathtaking beachline, opening up 500 tech jobs in the coming months.
Above average success rate of the first generation startups
Lisbon truly earned its success. The first generation of startups appeared five to ten years ago, before anyone believed in Portugal’s potential as a high-tech pod, amidst a tough recession, salary crunches and a grim economic outlook for the country. They toiled away under the radar, bootstrapping and quietly perfecting their product and proof of concept in one of the toughest markets and worst recessions in the country’s contemporary history. In order to grow, they also had to think international from day one and overcome the hurdles that come with international expansion in Europe: linguistic, legal, and cultural specificities.
An incredibly impressive number of the pioneers of Portugal’s tech scene have reached international success. It’s the case of big names such as TalkDesk, Uniplaces, Unbabel, Codacy, Farfetch, or Hole19 . Amongst them, a handful are well on their way to unicorn status, such as Outsystems that raised $360 million from Goldman Sachs and KKR earlier this year at a $1 billion valuation.
Amidst the thrill of cash and attention rolling in, one of Lisbon’s most valuable asset rests in the in the first wave of startups that have successfully scaled. Just as quietly as these first movers grew into internationally renowned companies with operations in cities like London, New York (Codacy), or San Francisco (Unbabel), Lisbon’s most established tech companies are providing the knowledge sharing and best practices so essential to the success and viability of a technology hub.