3 Best Countries in Europe for Startups and Founders (And Why?)

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The best countries in Europe for startups and why

If you are looking for the best country to start a business as a foreigner in Europe then you are on the right platform. You will learn about the best countries in Europe for startups and founders and why these EU countries are preferred options.

Location plays a key role when it comes determining how successful your mind-blowing business idea will eventually become.

As an entrepreneur, it is your utmost responsibility to carefully select the best country with the most startups per capita. Your choice is not going to be based on sentiments but raw facts that have been proven over and over again.

Whether you are looking for the best country to incorporate an online business or you are looking for an European country with moderate tax laws, we will help you get the answer in this guide.

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Some of the criteria we used in ranking the best countries in Europe for startups and founders include but not limited to the following: 

  • Cost of doing business rank (ease of doing business from the World Bank)
  • Economic health rank
  • Labour force quality rank
  • Business climate rank

Studies show that countries in Europe that performed really well in each of these rankings attracted more startups and founders. 

Why? Entrepreneurs will always gravitate towards an environment that gives their business room for growth.

Overall Ranking for Best European Countries for Startups

1. Germany as the No. 1 Best Country in Europe for Startups

Why Germany is the number one best country in Europe for startups and founders - European Best Destinations
Source: European Best Destinations

Germany is as it is today the best European country for startups and founders according to a 2020 report. With a GDP of $3.85 trillion, a healthy business climate and super-easy access to venture capital, foreign entrepreneurs seeking to launch their startups in Germany will get a good chance to thrive. 

Only after Switzerland does Germany rank second in terms of being less burdensome to small businesses in the areas of issuing business permits and regulations. With a highly educated workforce and corporate tax of 15.8%, growing a highly successful new business in Germany as a foreigner will be a lot easier.

2. United Kingdom

The best countries in Europe for startups and new entrepreneurs - UK

Why is the UK the second best European country to start a new business? The ease of doing business, easier access to venture capital and a thriving healthy economy automatically placed the UK as the second best country in Europe for startups and founders.

Despite the snail growth rate of the UK GDP sitting at $2.8 trillion, the United Kingdom is still the second-best European country to start a new business. With a corporate tax rate of 19%, ease of finding skilled employees and a ton of organisations ready to support startups with the best advice, setting up a new business as a foreigner will be a lot easier.

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It doesn’t matter whether you are starting a digital marketing agency in the UK, the best plumbing company or a sophisticated artificial intelligence startup from your family garage, the United Kingdom has got a viable business climate to allow you to thrive.

If you launch a cloud-based accounting software or any other type of tech company in the UK, you are sure of thriving because there are support organisations willing to help you grow.

3. Switzerland as the 3rd Best Country in Europe for Startups

Why Switzerland is the 3rd best country in Europe for startups and founders

Why is Switzerland the 3rd best country in Europe for startups?

Switzerland became the third-best EU country for startups as a result of her amazing business climate and labour force quality. That goes to show that you will be setting your business up for failure if you fail to take care of your employees. Here is a detailed article that explained why you need to take care of your employees.

Switzerland, known for having trains that can access all parts of the country snapped up the third position because they have the least issue with the regulatory burden compared to other parts of Europe.

The ease of doing business is also high. Almost everyone is permitted to start a new business if you meet the legal requirement.

If your goal is to register a new company in Switzerland please ensure you seek legal counsel. Aside from the privilege of enjoying a liberal tax system and politically stable economy, opening a new small business in Switzerland is easy.

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In a previous article, we took the time to explain other interesting benefits of starting a business in Switzerland. Read it here.

Although Azerbaijan is among the fastest-growing economies in Europe, partly due to the country’s growing energy sector, it didn’t still make it to the top 3 countries in Europe for startups and founders.

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