Barcelona’s startup ecosystem

This article was written in cooperation with Catalonia Trade & Investment in preparation of Startup Ecosystem Ranking Report 2019 that ranked Barcelona in spot 27 out of 1,000 cities.
Click here to view Barcelona’s Startup Map

Barcelona is at the top of startups hubs in Spain due to a strong commitment to research and innovation for many years already which is adding to a resolute and obstinate entrepreneurial attitude and a lot of individual and collective teamwork. All these attributes have brought Barcelona and Catalonia to this leading position in startup ecosystems.

Barcelona is Southern Europe’s most dynamic startup ecosystem. It is home to over 1,300 startups according to the Barcelona & Catalonia Startup Hub. The startup economy in Catalonia employs 13,820 people. The international feel of the city translates into the figures: 26% of all employees are from abroad, mainly from Western Europe (46%) followed by South America, Eastern Europe, Asia, Africa, and North America. In addition, 15% of startup founders are international. Working in the field of technology is what mostly attracts foreign talent. In fact, 27% of international employees develop their activity in this area, followed by sales (22%), management (20%) and operations (17%).

20% of startup founders would choose Barcelona. Where would you set up your startup if you were to establish one again? When asked this question, 20% of European startup founders choose Barcelona. Making it the third favorite hub after London and Berlin, according to Startup Heatmap Europe 2018. This also means more investment received from foreign-based investors. Foreign investors are involved in 74% of the highest rounds, as in the cases of startups Let Go, Glovo or TravelPerk. The sectors that attracted higher investments (in series A+B+C) are Medtech, Fintech, and Biotech.

Barcelona is No. 4 in capital investments in Europe. Financing is key for startup success and Barcelona keeps claiming its spot in the international sphere. Nowadays Barcelona lies 4th in the ranking of European cities by volume of investment received. The city raised €722M in 2017 and stands only behind London, Berlin, and Paris. 3 out of 4 Catalan startups have obtained financing from investors in 2017. It is noteworthy to say that 21% of all 1,300 startups have secured rounds of investment of over 1 million euros.

Strengths of Barcelona for Startups

Barcelona is one of the cities with the most trade fairs, congresses and conventions in the world. It is 4th in the International Congress and Convention Association (ICCA) rankings and 6th in the ranking of the Union of International Associations (UIA). Most worldwide renowned fairs: Mobile World Congress, 4YFN Connecting Startups, Smart City Expo World Congress, IoT Solutions World Congress, Advanced Factories Congress, Sònar, Women4Tech, and Big Data Congress among others. The city holds networking events day.

In addition, the city counts with numerous coding bootcamps to get job-ready professionals. For lower tuition costs and comparably faster, one can gain the necessary skills and knowledge to seek a career in the tech field. Some of the bootcamps include Data Science Dojo, SkyLab Coders Academy, World Tech Makers, Harbour Space, Epitech, Code Works, Ubiqum Code Academy, It Academy Cibernàrium (Barcelona Activa) and Le Wagon Barcelona, among others. Recently the initiative Barcelona Digital Talent has arisen. It aims to develop digital skills, attract international talent, adapt the training programs to the demand of the companies and boost the training of the new generations.

Startups and entrepreneurs can also benefit from a substantial list of various business angels, crowdfunding platforms, venture capital funds, investment forums and financial assessment expertise both local (ESADEBAN, Crowdcube, The Crowd Angel,  Kibo Ventures, Cabiedes Partners, Inveready, Caixa Capital Risc, Sabadell, Nekko Capital, K Fund, Nauta Capital Ysios Capital and Alta Life Sciences, among many others) and foreign-based (Insight Venture Partners, Index Ventures, Balderton Capital, Kennet, Idinvest Partners, Highland Europe, Howzat Partners, Eight Roads, Kurma Partners, Accel, Northzone, Mangrove Capital Partners, e.ventures, Spark Capital, Gilde Healthcare, Target Global and Naspers among many others.

On top of that, Barcelona has built a powerful co-working network that amounts to over 200 shared offices, including the world’s most famous shared offices at WeWork, Spaces, and OneCoWork. Other than that, the city has the most competitive costs for office space of all the 9 similar cities (Berlin, Madrid, Amsterdam, Milan, San Francisco, Dublin, Paris, and London).

Barcelona Uniqueness: the Mediterranean Culture and Nordic Execution

“We stand out because we are adventurous and we are clearly committed to technology and innovation”, says Jordi Aguasca, manager of Startup Catalonia, the program for startups by the Catalan Government. He says that the city has a “Mediterranean culture but Nordic execution”.

Following characteristics briefly present how Barcelona sticks out from other locations:

  • European scientific and technological powerhouse: world-class scientific infrastructures and technological centers inside or around Barcelona.
  • Unparalleled distribution capacity. Catalonia’s excellent geostrategic position and full-modal integration transport system allow for efficient connections to Europe, Asia, and the Americas. The logistics network can reach 400M consumers in Europe and the Mediterranean/Africa in less than 48 hours.
  • Entrepreneurial spirit: around 20% of new businesses created every year in Spain are based in Catalonia; most of them inside or around Barcelona.
  • Business Friendly: pro-business and pro-growth environment, open to foreign investment. Lower corporate tax rate than neighboring countries, efficient tax deduction schemes for R&D activities, the flat tax rate to expats coming to work in Catalonia, the optimal location for international holding companies, competitive and skilled workforce and employment incentives programs (Visas and residence permits fast-track process).
  • A major pool of local and international talent. The Catalan university system stands out for its ability to attract talent from all over the world. Source: Catalan University Department.
  • The first-rate spot for business and executive studies. ESADE and IESE business schools are recognized with the Triple Crown accreditation by the three most influential business school accreditation associations (AACSB, AMBA, and EQUIS). That makes Barcelona the only European city with two top-ranked business schools.

The Biggest Players in Barcelona’s Ecosystem

This enchanting seaside city counts with hundreds of co-working spaces, accelerators, venture builders and fab labs that all together position the city at the top level. Some of the technological hubs it allocates, where a huge part of the technology is produced and concentrated are:

  • BARCELONA SCIENTIFIC PARK (PCB). It houses Catalonia Bio and Biocat, associations of companies of this sector.
  • BARCELONA HEALTH HUB. It promotes innovation in digital health and its transfer to the sector.
  • UPC NORTH CAMPUS (POLYTECHNIC UNIVERSITY OF CATALONIA). It houses the building K2M (Knowledge to Market) and also some services of the BSC (Barcelona Supercomputing Center).
  • UAB PARK (BARCELONA AUTONOMOUS UNIVERSITY). It houses research institutes and centers which generate spinoffs.
  • UPC RDIT BUILDING (POLYTECHNIC UNIVERSITY OF CATALONIA). It houses the European Space Agency Incubator (ESA BIC Barcelona).
  • INSTITUTE OF PHOTONIC SCIENCES (ICFO). It houses the LEICA Nanoscopy Imaging Center of the NIKON Center of Excellence In Storm.
  • TELECOMMUNICATIONS TECHNOLOGICAL CENTER OF CATALONIA (CTTI)
  • TECNOCAMPUS IN MATARO. Education, research and technological transfer.
    • PIER01, promoted by Barcelona Tech City (association of digital companies). It houses initiatives like The Collider and Digital Talent by MWC Foundation as well as several accelerators, venture builders and corporate venturing programs like the Payment Innovation Hub (Caixabank, Global Payments Inc., Samsung, VISA and Arval) and Seat Metropolis Lab.
    • WEWORK (international coworking spaces)
    • SPACES (international coworking spaces)
    • ONECOWORK (coworking space born in Barcelona)

Incubators, Accelerators and Venture Builders:

  • BARCELONA ACTIVA. It houses many initiatives as the business incubator Glòries, the North Barcelona Technology Park, the incubator MediaTIC, and the Almogàvers Business Factory.
  • ESADE CREAPOLIS. From ESADE Business School, ranked at the top Business Schools in Europe, is an innovation hub including programs like the Fusion Point, the Decision Lab, the Fab Lab, the EGarage and the EWorks.
  • LA SALLE TECHNOVA BARCELONA.
  • CANÒDROM. It drives several corporate incubators as well as the accelerator Península.
  • PROTEUM X (Blockchain Accelerator)
  • CINC. It houses the business association 22@Network BCN with initiatives like 22@Breakfast, Àgora 22@Network, and 22@Afterwork.
  • BARCELONA FAB CITY. Barcelona is a key player in the development of the Maker movement and the Fab Lab Network worldwide.
  • THE THINX 5G BARCELONA. Telefónica and 5GBarcelona have promoted this space so that startups and other companies can work in an environment equipped with 5G technology.
  • USER EXPERIENCE LAB (UXLAB). Barcelona Activa has opened a laboratory where startups can test products and services, both physical and digital.

Biggest Startup Success Stories

A city with so many resources for startups to flourish, Barcelona has several success stories that are known as a real source of pride for the local ecosystem. According to the list of Investments in Catalan Startups by Barcelona & Catalonia Startup Hub, the startups that received the biggest investments in 2018 & 2017 are Glovo, Travelperk, Badi, Holaluz, Letgo, Wallapop, Minoryx, Red Points, Typeform, Herta, and 21Buttons. While among the largest valued exists there are Privalia, Social Point, Stat Dx, Captio, Trip4real, edreams, infojobs, milanuncios.com, Zhilabs, MyTwinPlace, Smadex, Letsbonus, and Doctoralia. In addition to that, Barcelona & Catalonia Startup Hub identified that three strongest sub-sectors for startups are Industry 4.0 (Artificial Intelligence, Big Data, Internet of Things, 3D Printing), Life sciences and Mobile & Software.

Startup Ecosystem Weaknesses

Notwithstanding that Barcelona’s startup ecosystem stands relatively high (Startup Ecosystem Rankings Report by StartupBlink ranked it 27th globally) and boasts with prosperous initiatives and lucrative exits, it is pivotal to identify the weaknesses for it to continue growing.

  • Barcelona needs to raise the number of startups.
  • R&D needs to be even faster transferred to the market.
  • Higher amounts of capital to Series B and C rounds.

Sources:

Pere Condom-Vilà  http://www.perecondom.com/2019/03/04/hubs-tecnologics-barcelona/

Catalonia Trade & Investment http://catalonia.com/startups-in-catalonia/

Fira de Barcelona and Barcinno www.barcinno.com/