Methodology

For this report, we define scaleups as startups that are valued as equal to or more than $50 million. Our insights are based on longitudinal analysis of founders and leaders of young startups (<=4 years old) who responded to our surveys in 2015, 2017, 2018, and 2019.

• 8,040 startups from 40+ countries were surveyed.
• 60+ objective metrics including funding, Local and Global Connectedness, founder DNA, and percentage of paying customers outside of the founding continent were considered.
• We identified 370 startups that scaled to a valuation of over $50 million.
• We analyzed the statistical differences between these 370 scaleups.

Key Definitions

Ecosystem: We define a startup ecosystem as a shared pool of resources, generally located within a 60-mile (100-kilometer) radius around a center point in a given region, with a few exceptions based on local reality. Resources typically include policymakers, accelerators, incubators, coworking spaces, educational institutions, and funding groups.

Exit: An exit, in the context of startups, refers to an event in which the founders, investors, or employees of a startup realize a return on their investment by selling their ownership stake in the company. Exits include IPOs, M&A, buyouts, and reverse mergers. Starting from this year’s ranking, we are including buyouts and reverse mergers as valid exit types. We only include the first exit as relevant.

H1/H2: Fiscal periods of half a year, in which January–June is H1 and July–December is H2. Similarly, Q1, Q2, etc. refers to the four fiscal quarters of a year (January–March, April–June, etc.).

Startup: We define a startup as an innovative or technology-driven company that was founded within the last 10 years and that has technology and/or scalability at the core of its business model. In addition to software, this includes startups active in Deep Tech, such as Robotics, Life Sciences, and more.

Unicorn: A startup that meets our definition and has been valued at more than $1 billion and has not exited.

Ecosystem Phases

We divide ecosystems into four phases of maturity:

Activation

An Activation-phase ecosystem is characterized by limited startup experience and low startup output (<1,000 startups), where the main focus is to grow startup output (or the number of startups locally), early-stage funding (seed and Series A rounds) and a more connected local community. It is the leading ecosystem in the nation and sometimes, in the region. The main challenge of Activation-phase ecosystems is that they experience resource leakages (startups, talent, capital) to later-phase ecosystems nationally and globally. This makes it very challenging to grow the ecosystem to the Globalization phase without important investments by local governments and community leaders. Startups in ecosystems that are different from or geographically distant to innovation markets (i.e. those in the U.S., Western Europe, and parts of Southeast Asia) often experience accelerated growth by solving local problems and adapting global innovations to the local reality.

Globalization

A Globalization-phase ecosystem is characterized by an output of more than 1,000 startups, increased startup experience in the ecosystem, and a series of exits that trigger national resource attraction. These ecosystems are national leaders, or sometimes regional leaders.

Triggers to this phase include increased Startup Experience (the accumulation of knowledge and resources), leading to the production of a series of regionally impressive exits, usually greater than $100 million.

Attraction

An Attraction-phase ecosystem is characterized by usually more than 3,000 startups, where the main objective is to drive global resource attraction to significantly expand the size of the ecosystem and address resource gaps. Ecosystems in this phase are usually regional leaders (or nationally leading if they’re in the United States). Examples include Singapore, Amsterdam, Berlin, and Chicago. Triggers to this phase include a series of globally impressive events such as the creation of unicorns and $1 billion+ exits.

Integration

An Integration-phase ecosystem is characterized by more than 5,000 startups, with the ecosystem integrating into the global fabric of knowledge, producing global business models, and achieving higher global market reach. Ecosystems in this phase are globally leading and are considered one of the leading sectors of value creation for the local economy. Integration Phase ecosystems should prioritize deeper alignment with the economic, social, and regulatory fabric of the economy to support large-scale innovation and equitable outcomes. Triggers to this ecosystem phase include self-sustainable Global Connectedness levels and extremely high global resource attraction.

Global Scaleup Mapping

For the purposes of this article, a scaleup is a startup that has received more than $50 million of disclosed VC investment. This data builds on a total number of more than 300,000 global funded companies on Dealroom.co, including a current pool of over 150,000 active VC-backed startups. Disclosed VC investment refers to any funding round tracked by Dealroom in which at least one VC investor participated, as well as any funding round labeled as VC rounds following the Dealroom definition. Learn more about Dealroom's definitions here and proprietary tech taxonomy here.

A Deep Dive into Deep Tech Scaleups in Europe

The analysis in this article is based on a subsample of 725 hypergrowers derived from the European Scaleup Monitor 2023’s primary data source, Orbis, matched with Dealroom using company name and location indicators. The statements made in this article do not represent the full European population of Deep Tech scaleups, but rather a subsample of scaleups merged with Dealroom’s “Deep Tech” tag. Read more details about the research methods by the European Scaleup Institute on page 30 of the European Scaleup Monitor 2023 and refer to Dealroom’s Taxonomy & Definitions here for more information about the data represented in this article.