The Austrian start-up ecosystem will develop further, and the venture capital market maturity level will rise.
This is a short version of the article ”5 predictions for the Austrian financial services market and its CEE footprint in light of the global Covid-19 pandemic” and focus on the 4th of 5 predictions “The Austrian start-up ecosystem will develop further, and the venture capital market maturity level will rise.”
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2020 was a rollercoaster for all of us, but “Life is a rollercoaster, you just gotta ride it!” Therefore I would like to invite you to have a look into the crystal ball, as it is important to position for the post-covid period.
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The entire article “5 predictions for the Austrian financial services market and its CEE footprint in light of the global Covid-19 pandemic” is available here.
Let’s have a look into the crystal ball
What will the Austrian financial services market look like in the next couple of years? And will today’s major Austrian financial players remain prominent in the future?
So far, the outbreak of Covid-19 truly showed that we are living in a volatile, uncertain, complex and ambiguous (VUCA) world.
What is known is that the global pandemic is acting as an accelerator for global trends:
- Demographic change: population growth, young vs. old countries, old vs. young generations, migration, urbanization, war for talent, etc.
- Digital transformation: data and analytics, automation, connectivity, omnichannel approaches, user and customer experience, accessibility anywhere / anytime, etc.
- Technology and innovation: exponential growth and agility of tech, artificial intelligence, security, adoption in ‘social service’ models, evolution of communication channels, blockchain, Open Banking, etc.
- Sustainability: scarcity of resources, ownership of responsibility, climate change, etc.
Beyond this, we know that it creates opportunities as well as disruptions.
Based on recent market developments and global trends, below are five predictions for how the Austrian financial services market will evolve over the next four to five years[1] and how those predictions are impacted by the global pandemic.
4th of 5 predictions
The Austrian start-up ecosystem will develop further, and the venture capital market maturity level will rise.
- Austria’s start-up ecosystem and its international ties to cities known for their entrepreneurial culture have developed steadily over the past few years.
- However, based on various start-up hub rankings[2] as well as statistics,[3] Austria and its capital Vienna rank midfield compared to other countries and cities. According to WEF, the following two factors influence the rankings: attitudes towards entrepreneurial risk and administrative requirements such as the cost or time of starting a business.
- The latest governmental program, presented in January 2020, aims to follow a best-of-vision for Austria’s start-up ecosystem and catch up with the more advanced start-up hubs.[4]
- In particular, the adoption of legal frameworks and initiatives related to providing risk capital will support the Austrian start-up landscape evolution.
- In addition, initiatives such as Moonshot Pirates will continue to encourage young minds to dream big and adopt entrepreneurial thinking (see also Impact report 2020).
How is the prediction impacted by the global pandemic?
Although the capital Vienna was able to climb seven leather steps within the 2020 startupblink ranking, Austria and its capital Vienna continue to rank midfield to comparable other countries and cities. However, Austria is able to attract. And with Plug&Play and TSH collab two well-known international players have opened their doors in Vienna during pandemic.
Unfortunately, the discussions to update the legal frameworks related to start-ups have not been finalized during 2020. Tangible and concrete results for the so called “Austria limited” will hopefully follow during 2021.
In September the Austrian ministry of finance invited several experts to a round table in order to kick-off a nation-wide initiative to enhance financial literacy competence across Austria for all ages. Specialized start-ups like SAVEE are happy to support with their mission to enable a positive relationship to money, wealth and risk taking.
For the first time the Spin off Austria conference took place in November, in order to promote that entrepreneurship must be a third mission for Austrian universities alongside research and teaching.
Well, from a global perspective, the venture capital maturity level of Austria is still a rising star. But recent activities and initiatives listed in the above section of this article “Market developments in 2020” are building confidence that the Austrian financial services ecosystem will keep its traction.
Entire article
The entire article “5 predictions for the Austrian financial services market and its CEE footprint in light of the global Covid-19 pandemic” is available here.
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About
This is an updated version of the article “Five predictions for the Austrian financial services market and its CEE footprint”, which was initially authored by Tobias Schaller and published with Capco in February 2020.
Since summer 2020, Tobias acts as an independent trusted advisor via his own consultancy mosaikProjects.
The update provides insides based on latest available data and recent market activities and reflects the five predictions in light with the global Covid-19 pandemic throughout 2020.
References
[1] The predictions were initially authored by Tobias Schaller and published with Capco February 2020.
[2] e.g. www.valuer.ai / www.startupblink.com
[3] World Economic Forum; 2019; The Global Competitiveness Index; sub-indices related to business dynamism
[4] derbrutkasten.com; January 2020
