Barcelona's ambition is to be a hub for Scale-Ups
A study by Barcelona Global in collaboration with CaixaBank DayOne and Barcelona Tech City identifies the profile of Barcelona's scale-ups and determines which elements can be improved to position the city in the first league of cities of successful scale-ups.
The first edition of the Scale-Up Monitor reaffirms the potential of Barcelona's entrepreneurial ecosystem: high quality of life, security, good geographical connectivity and cultural offerings.
In order to carry out the study, twenty specialists and more than 50 scale-ups of the city were contacted.
Barcelona Global has presented this Tuesday December 4, 2018 the Scale Up Monitor, a study that analyzes the ecosystem of Barcelona scale-ups, understood as those start-ups that have shown high growth in recent years and have reached a stage of consolidation. The presentation was attended by the president of Barcelona Global, Pau Guardans i Cambó; the general manager of CaixaBank, Juan Antonio Alcarazy and the Board Member of Barcelona Tech City, Miguel Valls.
The study identifies those elements of the city most valued and especially in which areas Barcelona must improve so that scale-ups can consolidate and become poles that generate employment, wealth and international projection. All this, with the aim of drawing up a series of recommendations that will shape an agenda of concrete actions to be carried out.
The Scale-Up Monitor:
Report made by the DYM Institute from:
20 personal interviews with founders, specialists and investors of scale-ups, carried out between April and June 2018.
A quantitative questionnaire of 61 questions to 52 scale-ups, carried out between June and July 2018.
Profile of the scale-ups:
A scale-up is a start-up that has shown sustained growth in recent years and where the figure of the entrepreneur also becomes an entrepreneur.
The selection criteria for the universe studied has focused on those technology-based scale-ups that have raised one million euros in the last 5 years and whose headquarters are in Barcelona or surrounding areas.
Young companies with a clear specialization towards the digital sector (52% of the companies surveyed).
Founded by 2 or 3 entrepreneurs, mainly men (75%) between 35 and 49 years old and repeat offenders (54% have founded 2 to 4 projects).
Managed outside the traditional areas of start-ups.
Provident financing mainly of business angels venture capital nacional (73% of the companies surveyed).
Most companies still do not generate profits (62%), but virtually all have plans for operational growth, hiring employees and raise funding rounds in the next 18 months.
With multicultural templates.
Starting point - advantages and disadvantages:
According to the results of the surveys, the main factors that motivate global entrepreneurs to promote new initiatives in Barcelona are the high quality of life (6.7/7), the security of the city (6.2/7) and the good geographical connectivity (5.9/7) together with the high cultural offer (6.1/7). These strengths also contribute to the attraction of international talent.
Despite this favorable climate and a successful track record in the world of scale-ups, in general, "there is a culture of fear of failure and a lack of more global vision". The study identifies some key aspects that entrepreneurs consider should be improved for the development of business zones, starting with the local funds that support this type of organizations. "There is a variety and quality of funds for initial phases, but there is a lack of growth funds, after the consolidation stage, to boost the trajectory of global companies (3.9/7)".
On the other hand, the survey shows that local talent, both at a high level and with specific programming and development profiles, is scarce within the sector and ends up being supplied by hiring international talent (88%). In this case, it is when it is verified that there is room for improvement in terms of taxation and processing of impatriates. Taxation is not a competitive factor (2.6/7) either from the point of view of personal or corporate taxation, and some of the factors that do not contribute to being fiscally competitive are high taxation, Stock Options taxation, Phantom Shares and Exit Tax.
Other city factors that the Scale-Up Monitor has identified as potential elements for improvement are: housing (4,1/7) and public sector support for business development (4/7).
Finally, an assessment has also been made in relation to the space of the scale-upsy the common point is that they "need flexible space to grow". "The main European cities (London, Berlin, Amsterdam...) are at 10% in coworking use. Barcelona is at 1% but with the forecast to equal this 10 soon; it is necessary to professionalize the operators of office rentals, lack of lobby.
Call to action:
This first approach to the scale-up ecosystem proposes a series of proposals for improvement:
More competitive taxation is needed to foster the growth of the entrepreneurial sector.
Promote the creation of venture capital funds aimed at investing in the growth segment.
Improve international contracting procedures.
Greater efforts in the training of talent and profiles demanded by the sector.
More attractive and flexible space for entrepreneurship.
There is a difficult road to travel, but Barcelona, being one of the best cities in the world for talent and economic activity, has a good base to arrive with effort and dedication to the objectives proposed in this first edition of the Scale-Up Monitor.
1]Rating of respondents on a scale from 1 to 7, in which 1 is a negative rating and 7 is a positive rating.