Europe’s Scaleup Geography – Concertation or Convergence? The role of technological specialisation in the entrepreneurial ecosystem

While the concept of the ecosystem for entrepreneurs and startups dominates the discourse on promoting innovation, the territorial pattern of cities with startups remained largely uncharted territory. Therefore, this paper aims to fill this gap and raises the main question of how concentration and convergence processes are shaping the European landscape in this regard.

The main source of information is the Dealroom.co, from which we retrieved 12,500 scaleups (startups that raised more than 1 million euros in funding) with a total funding of 235bn euros and matched them to OECD-EU functional urban areas classification. Based on performance variables such as number and total funding of scaleups, we performed a cluster analysis that resulted in six clusters including 166 cities with significant performance.

Our analysis of the European scaleup landscape reveals a strong West-East and North-South divide and the dominant role of a handful of scaleup cities. However, when looking at the technological specialisation of scaleup cities and investigating the scaleups in Industry 4.0 technologies, the territorial patterns are markedly different. The calculation of location quotients underlines that the territorial pattern of scaleups in Industry 4.0 is more diverse, and particularly the university towns and smaller cities specialising in these technologies are showing some sign of convergence.