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Startup hotspot Austria continues to gain momentum

"Every year Pioneers attracts more than 1,100 international founders to Vienna. They are not randomly selected but chosen within the context of an elaborate application process", said Oliver Csendes, CEO of Pioneers, in opening the Pioneers Festival. The event was given the Best Event Award (Bea) for being the world's "Best Conference 2017". As a joint venture between Pioneers and startup300, the Pioneers Festival offers an outstanding network to startups. Under the motto "Walk the Talks", this year's event focused on the issue of how "deep tech" will influence every phase of our lives in the future. Larry Sanger, Wikipedia co-founder, Geoffrey Prentice co-founder of Oriente and Skype, NASA space researcher Kerry McGuire, racing driver and entrepreneur Collete Davis, Davide Dattoli, co-founder and CEO of Talent Garden and the Austria geneticist Markus Hengstschläger were just a few of the international speakers dealing with this topic.

Talks, pitches and announcements

A large number of lectures, talks and pitches not only comprised the perfect context for personal discussions and business transactions but also served as a platform for presenting innovations and making announcements. The Viennese Fintech startup Bitpanda took advantage of the opportunity to report that gold and silver would also be traded on the former crypto exchange. Margarete Schramböck, Federal Minister for Digital and Economic Affairs, seized upon the occasion to present the "Open Data Initiative" as an important measure to promote startups. It comprises a data platform to which startups will also have access. Shortly beforehand, Ms. Schramböck introduced a new startup package to the Council of Ministers which includes a digitalisation and growth fund. Under the auspices of Austria Wirtschaftsservice (aws), a public private partnership (PPP) model will be created to which the Federal Ministry for Digital and Economic Affairs and the business community will each contribute 50% of the funds. The total volume could even be raised to EUR 600 million thanks to the additional participation of business angels and investors. This fund, which continues the successful work of the aws Founders Fund and aws SME Fund, targets companies in the founding and initial growth phases. Startup300 AG announced the setting up of a new fund for early phase investments to operate under the name Pioneers Ventures III. It is already planned to invest at least EUR 10 million in very young companies in Austria and abroad starting in the fall of 2019.

The Austrian startup scene

The fact that Austria's commitment to a dynamic startup scene has borne fruit is proven last but not least by numerous exits spawned by the Alpine Republic in recent years. The founders of mySugr, TourRadar and Shpock discussed their experiences within the context of the second day of the Pioneers Festival focusing on the domestic startup scene. They emphasized the importance of public sector funding, which represents a special feature of the Austrian startup ecosystem. There was also speculation about the future of the Austrian startup scene. The exciting question at the moment is which company will become Austria's first unicorn startup with a market value of more than USD 1 billion. According to Oliver Holle of the venture capital provider Speedinvest, the top candidates at present are Bitmovin and Tourradar.

Annual results for 2018

Flo Kandler, an expert on the startup landscape, once again summarised what happened in his annual Startup Report Austria which was published in March 2019 for the fourth time. He noticed two main trends. For one thing, startups in Austria are become more sophisticated and globalised. The top eleven startups listed in 2018 attracted more funding than all 66 startups combined in the previous year. A total of EUR 238 million was invested in Austrian startups in 2018, a rise of EUR 100 million from the prior-year figure. Major rounds of funding topping EUR 2 million grew by 66 percent, significantly faster than smaller funding rounds (54 percent growth). This underlines the further development of startups. Kandler also noticed another significant development, namely the increasing internationality of the Austrian startup scene. An increasing number of founders from abroad set up their startups in Austria. This underlines the attractiveness of Austria's ambitious startup promotion system.

Do you have a startup and are interested in Austria as a business location? Please do not hesitate to contact me for an initial consultation without any obligation on your part.

Philip Juranich, MA

+43-1-588 58-13
startup@aba.gv.at

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