2022 Global Startup Ecosystem Report published by Startup Genome

Ecosystem

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The 2022 Global Startup Ecosystem Report (GSER), the most extensive global data-driven research on startups by Startup Genome, a world-leading innovation policy advisory and research firm, was published at London Tech Week. Among other things, Budapest has been ranked a Top 35 European Ecosystem in Affordable Talent.

The study, analyzing 280+ entrepreneurial innovation ecosystems and three million startups, ranks the leading 140 startup ecosystems, shares global startup trends and continental insights, and includes close-ups of crucial ecosystem players.

Startup Genome has partnered with Hungary’s National Research, Development and Innovation Office and the Ministry of Innovation and Technology, responsible for creating the country’s national RDI strategy, to showcase Budapest in the GSER. The partnership entails working closely to collect and review data and also highlighting the major movements in the ecosystem. The government does financially support the project and plays a large role in sharing success stories locally, but does not influence the outcomes of the project, Startup Genome noted. 

“We strongly believe that the abundance of local talent combined with a vibrant startup ecosystem will significantly contribute to innovation in Hungary,” said Tibor Gulyás, deputy state secretary at the Ministry for Innovation and Technology. “We have to continue funding the investment activities of the best private technological incubators,” he added.

Budapest is home to a growing startup ecosystem, with more than 900 startups, more than 50 investors, and an expanding array of support organizations. Hiventures, one of the largest government-funded VCs in Europe, manages a startup fund of some USD 220 million with more than 400 investments.

“Startup Genome is thrilled to see such incredible growth in the Budapest startup community coming out of the COVID-19 pandemic,” shares Marc Penzel, founder and president of Startup Genome.

Budapest’s entrepreneurial ecosystem created USD 1.6 billion in ecosystem value from July 1, 2019, to Dec. 31, 2021. It was ranked a Top 25 European Emerging Ecosystem in Funding, which measures innovation through early-stage funding and investor activity, and a Top 35 European Ecosystem in Affordable Talent, which measures the ability to hire tech talent.

The report highlights artificial intelligence as a sub-sector strength, as the Continental Artificial Intelligence Development Center, an active player in Hungary’s AI ecosystem, houses more than 1,000 people working in R&D-related activities. The value of fintech is underlined, with around 24% of Hungarian fintech companies operating in financial software development and system integration, 21% being involved in payment services, and 20% in data analysis and business intelligence services.

A highly skilled workforce, low cost of living, and startup-friendly policies are cited as reasons for a startup to move to Budapest, with the 9% corporate tax rate the lowest in the European Union.

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