November 15, 2019
European investment in Portugal’s digital sector can help address a shortfall in equity funding for start-ups and support an export-driving technology industry
A 30 million euro fund backed by the European Investment Fund (EIF), the Portuguese government and venture capital investors was announced at the Web Summit – Europe’s largest tech conference, held in Lisbon since 2016. The EIF’s investment is backed by the Juncker Plan’s European Fund for Strategic Investments. Faber Tech II will focus on investing in early-stage, data-centric start-ups in Iberia, primarily from Portugal, focused on artificial intelligence, machine learning and big data.
“The European Fund for Strategic Investments – the Juncker Plan – is once again demonstrating its European added value by supporting the Portuguese economy and its innovation ecosystem. Thus, Portugal remains one of the top five beneficiaries of the Juncker Plan, which dedicates more than 25% of its funds to research and innovation projects”, said Commissioner Carlos Moedas, responsible for Research, Innovation and Science.
Virtually non-existent 10 years ago, Portugal’s start-up sector attracted 485 million euros in foreign investment and contributed to 1.1% of GDP last year.
A qualified labor force, tax incentives, and a stable political environment are Portugal’s competitive advantages. It is important to to promote the infrastructure in place to support it and the traits of the country and people – why Portugal is the right place to start up and invest.
Subsidies and Summits
Recent years have seen the Government drive through numerous initiatives and incentives to boost the start-up ecosystem and promote sustainable economic growth, innovation and opportunities. From a €200m venture capital fund aimed at boosting foreign investment in start-ups, StartUp Portugal (with over 20 initiatives for attracting new investment, talent and innovation) to a StartUp Visa for foreign entrepreneurs and tax incentives for non or new residents.
The Web Summit has also been a boost to various aspects of this country’s economy, such as tourism, and also created a demand for supporting facilities including incubators and accelerators.
The Portuguese advantages
The digital economy requires people that are open and internationally-minded, free thinkers and flexible, who can move from idea to idea and adapt quickly and painlessly. Portugal benefits from having a very qualified and skilled work force of multi-lingual talent. Big businesses establishing bases in Lisbon for their European operations. Mercedes for example – and others who are especially taking advantage of Portugal’s young tech talent.
The country is also investing in infrastructure to support the start-up ecosystem with hubs opening across the country, such as the Beato Creative Hub, a large-scale incubator in the north of Lisbon for start-ups and other tech businesses, including the Daimler-Mercedes research centre.
Additionally, with political uncertainty prevailing around Europe – Brexit being a case in point, this is a definite concern for any potential investors or entrepreneurs. Portugal’s stable political climate without a doubt plays a part in amplifying its attractiveness.
Source: LEXOLOGY, REUTERS, PUBAFFAIRS BRUXELLES